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FRATEKNAL    SOCIETY 

LAW 


EMBRACING  THE  -_t,.,, 

STATU  T.E    L  A  W ■  "  fv^-    - 


And  a 


DIGEST  OF  THE  DECISIONS  OF  THE   COURT  OF  LAST  RESORT  OF 

THE  SEVERAL  STATES  CONCERNING  FRATERNAL 

BENEFICIARY  SOCIETIES 


CARLOS  S.  TIARDY,  D.  C.  L. 


Member  or   the   Chicago  Bar  ;  Lecturer  on   Law  of   Insurance,  Illinois  College 

OF  Law  :  Member  Board  of  Editors,  International  Encyclop.-edia  of  Insurance, 

Sihce  1901 ;  Secretary-Treasurer,  Law  Section.  National  Fraternal 

Congress;  andSince  1900General  Counsel  of  The  Supreme  Lodge 

Knights    of    Pythias    (Insurance     Department). 


EDITION    FOR    1907. 


COPYRIGHT,  1908, 

BY 

CARLOS    S.   HARDY 


T 


i9on 


t 

?1  ■  . 

INTRODUCTION. 

It  has  been  well  said  that  the  busy  lawyer  has  no  business  attempt- 
ing to  write  a  law  book.  Nevertheless  it  is  only  the  busy  lawyer 
who  fully  realizes  the  value  of  a  book  that  contains  the  statement 
of  the  law  of  his  ease. 

With  an  extensive  Fraternal  Society  practice  for  several  years 
and  covering  all  the  States  of  the  American  union,  I  have  experi- 
enced the  full  need  of  a  compilation  of  the  statute  law  of  the 
several  states  in  so  far  as  it  affects  Fraternal  Societies.  The  stat- 
ute law  alone  is  embraced  in  more  than  one  hundred  volumes. 
To  search  these  hundred  and  odd  volumes  in  order  to  know  the 
statute  law  is  a  herculean  task  and  one  that  but  few  lawyers  ever 
have  the  time  for  and  certainly  no  Fraternal  Society  manager  would 
ever  attempt  the  task.  I  have  brought  into  this  one  volume  this 
statute  law  of  the  country  affecting  Fraternal  Societies,  and  whether 
my  labor  in  accomplishing  this,  is  appreciated  or  not,  I  have  the  satis- 
faction of  knowing  that  I  have  thereby  lessened  the  labors  of  all  who 
would  have  had  to  search  the  many  volumes  of  the  statutes  for  the 
law  upon  the  sub.jects  herein  treated  of.  Some  half  dozen  years  ago 
I  began  collecting  decisions  of  courts  of  last  resort  upon  Fraternal 
Society  questions  and  briefly  digesting  them  on  a  card  sj'stem. 
This  system  of  cases  on  cards  has  grown  to  such  proportions  that 
I  have  come  to  rely  on  it  as  an  index  to  the  case  law  of  the  country, 
more  than  on  any  of  the  general  digests.  My  first  idea  was  to  pub- 
lish these  card  digests,  but  I  found  after  further  consideration,  that 
it  would  be  best  to  redigest  the  cases  collected,  and  so,  I  have  em- 
braced in  this  volume  a  digest  of  all  the  leading  cases  of  the  courts 
of  last  resort  of  the  several  States  that  have  been  handed  down 
during  the  period,  December,  1897,  to  December,  1907,  affecting 
Fraternal  BeneficiarA'  Societies.  I  have  grouped  these  cases  by 
states  rather  than  by  subject  matter  and  they  follow  the  statute 
law  in  the  chapters  devoted  to   the  respective  states.     There  are 


729S71 


6  INTRODUCTIOX 

but  tew  cases  back  oi  December.  1897,  not  herein  digested,  which 
are  of  value  to-day.  The  present  hiw  of  Fraternal  Societies  has  been 
made  almost  wholly  during  the  last  ten  years.  The  present  day 
Fraternal  Society  is  a  far  different  institution  from  that  of  fifteen 
or  twenty  years  ago.  As  they  have  evolved,  so  has  the  law  respect- 
ing them.  Quite  a  few  cases,  where  the  parties  were  not  Fraternal, 
are  digested  because  of  the  principles  announced,  which  are  deemed 
applicable  to  Fraternal  Societies. 

It  is  not  claimed  that  my  effort  has  resulted  in  the  making  of  a 
perfect  book.  But  it  is  claimed  that  there  is  no  single  volume  con- 
taining the  Fraternal  Society  law  embraced  herein,  nor  indeed  has 
the  attempt  before  been  made  to  publish  such  a  book.  Future  issues 
which  are  expected  to  be  annual,  in  order  to  keep  abreast  with  the 
legislatures  and  the  courts,  will,  it  is  to  be  expected,  be  great  im- 
provements over  this  effort.  The  start  has  been  made.  The  volume 
is  intended  for  the  use  of  the  Fraternal  Society  manager  and  the 
lawyer  interested  in  Fraternal  litigation,  which  is  now  of  great  con- 
sequence, and  it  is  my  wish  that  to  them  it  will  prove  helpful  and 
generally  satisfactory. 

CARLOS  S.  HARDY. 

Chicago,  January  23,  1908. 


FRATERNAL  SOCIETY  LAW. 


THE 

STATE  OF  ALABAMA. 

CHAPTER  1. 

There  is  no  statute  law  in  Alabama  relating  to  Fraternal  Benefit 
Societies,  as  such. 

Mutuality — Ultra  Vires  Contracts. 

A  mutual  benefit  association,  organized  under  the  Alabama  code, 
and  authorized  by  its  charter  to  pay  sick  and  death  benefits  to  its 
members  out  of  funds  accumulated  from  assessments  on  them,  is 
without  authority  to  contract  for  the  repayment  of  the  amount  paid 
in,  less  benefits  paid,  said  amount  to  be  payable  at  the  end  of  ten 
years  from  the  date  of  contracts.  Such  contracts  are  ultra  vires, 
as  being  destructive  of  the  principle  of  mutuality  upon  which  the 
association  is  founded.  Citing  with  approval,  Kennan  vs.  Rundle, 
81  Wis.  21-1;  51  N.  W.  426. 

Southern  Mut.  Aid  Ass'n  et  al.  vs.  Boyd  et  al.,  May  9th,  1906,  145 
Ala.   167;    41   So.   164. 

After  Enacted  Laws — Suicide. 

Where  a  benefit  certificate  provided  that  the  member  shall  be 
bound  by  the  laws  of  the  society  then  in  existence,  and  by  those 
that  may  thereafter  be  adopted,  the  members  are  bound  by  all  sub- 

(7) 


g  FRATERNAL    SOCIETY   LAW 

sequently  enacted  laws,  provided  that  such  laws  are  within  the 
charter  powers  of  the  association,  and  do  not  violate  the  laws  of 
the  state,  nor  impair  the  obligation  of  the  member's  contract.  Such 
subsequent  by-laws,  which  provide  that  in  case  of  death  by  suicide, 
that  the  society  shall  pay  only  one-third  of  the  amount  of  the  cer- 
tificate, is  held  to  be  reasonable  and  valid. 

Fraternal  Union  of  America  vs.  Ziegler,  Dec.  21st,  1905,  145  Ala.  287; 
39  So.  751. 

Members  Bound  By  After-Enacted  Laws — Suicide — Incontestability. 

"Where  a  benefit  certificate  provided  that  it  shoidd  be  incontesta- 
ble after  two  years,  and  also  contained  the  provision  that  the 
member  accepting  it  should  be  subject  not  only  to  existing  laws,  but 
to  all  by-laws  subsequently  adopted,  and  at  the  time  of  the  issuance 
of  the  certificate  the  by-laws  provided  that,  in  case  of  suicide  the 
member  forfeited  all  claims  to,  or  benefits  under  the  certificate,  but 
more  than  two  years  thereafter,  the  society  adopted  another  by-law 
providing,  that  in  ease  of  suicide,  the  society  should  pay  one-third 
of  members  certificates,  it  was  held  that  the  subsequently  enacted 
by-law  applied  to  the  certificate,  and  was  not  objectionable  as  im- 
pairing the  obligation  of  the  members  contracts. 

Fraternal  Union  of  America  vs.  Ziegler,  Dec.  21st,  1905,  145  Ala.  287; 
39  So.  751. 

Dependents — Who  Are. 

A  grown  married  man,  earning  a  good  salary,  and  saving  money, 
is  not  a  dependent  within  the  terms  of  the  by-laws  of  a  benefit 
society  permitting  dependents  to  become  beneficiaries  of  such  society. 

Morey  et  al.  vs.  Monk,  Feb.  6.  1906.  145  Ala.  301;   40  So.  411. 

Beneficiary — Stepson. 

A  member's  wife  was  named  as  beneficiary,  but  she,  deceased, 
leaving  a  son  bj'  a  former  husband;  the  member  having  no  children 
by  this  wife ;  and  subsequently  the  stepson  claimed  to  be  entitled  to 


THE    STATE    OF   ALABAMA  9 

take  the  benefit  under  the  American  Legion  of  Honor  by-law,  pro- 
viding for  dependents  and  relatives  of  members  to  be  named  as 
beneficiaries,  bnt  the  court  held  that  the  affinity  existing  between 
the  stepson  and  the  stepfather  was  dissolved  by  the  death  of  the 
mother  and  wife,  and  that  said  stepson  was  not  entitled  to  take 
the  benefit. 

Morey  et  al.  vs.  Monk,  Feb.  6th,  1906,  145  Ala.  301;  40  So.  411. 

State  Statute  Enlarges  Class  of  Beneficiaries. 

Under  the  Massachusetts  Acts  of  December  31st,  1901,  which 
authorized  the  substitution  of  persons  as  beneficiaries,  who  were 
not  eligible  on  the  death  of  the  named  beneficiary  "with  the  con- 
sent of  the  officers  and  under  the  rules  as  they  may  prescribe,"  one 
not  previously  eligible  as  beneficiary,  but  who  has  been  substituted 
on  tlie  death  of  the  beneficiary  named  in  the  certificate,  is  entitled 
to  the  benefits,  although  it  does  not  appear  that  the  society  has, 
adopted  rules  extending  the  class  of  beneficiaries. 

Morey  et  al.  vs.  Monk,  Feb.  6th,  1906,  145  Ala.  301;   40  So.  411. 

Courts  Not  Bound  by  Society's  Construction  of  Laws. 

The  construction  given  to  a  contract  in  a  fraternal  beneficiary 
society  by  the  officers  of  the  society,  is  not  binding  upon  the  courts, 
and  the  members  are  not  necessarily  bound  by  any  acts  which  may 
have  been  done  under  such  construction. 

Morey  vs.  Monk,  Nov.  19,  1904,  145  Ala.  301;  40  So.  411. 
Trustees — Surviving  Children. 

Where  in  a  life  insurance  contract,  insurance  is  made  payable 
to  certain  trustees,  named,  for  such  of  the  insured's  children  as 
may  survive  him,  it  is  held  that  the  beneficiaries  named  in  the  eon- 
tract  are  the  children  of  this  insured  as  a  class,  which  includes  those 
children  born  after  the  making  of  the  contract,  and  without  any 
distinction  between  such  after-born  children  and  those  born  pre- 


10  FRATERNAL    SOCIETY   LAW 

vionsly,  and  without  distinction  between  children  of  one  wife  and 
children  of  another  wife. 

Morey  et  al.  vs.  Monk,  Feb.  6,  1906,  145  Ala.  301;   40  So.  411. 

Death  by  Members  Own  Hand — Suicide. 

A  benefit  certificate  which  provides  against  death  by  the  mem- 
ber's own  hands,  is  to  be  interpreted  as  meaning  death  by  suicide. 

Fraternal  Union  of  America  vs.  Ziegler,  Dec.  21st,  1905,  145  Ala.  287; 
39  So.   751. 

After  Enacted  Laws — Suicide. 

One  of  the  best  considered  ewses  on  the  validity  and  binding  qual- 
ities of  after-enacted  by-laws,  is  that  of  The  Supreme  Commandery 
of  the  Knights  of  the  Golden  Rule  vs.  Ainsworth,  and  this  case  has 
been  the  very  foundation  stone  upon  which  most  of  the  decisions 
of  the  courts  of  last  resort  in  this  country,  upholding  after-enacted 
by-laws,  has  been  founded. 

The  Ainsworth  ease  discusses  a  number  of  questions  of  fraternal 
beneficiary  law.  such  as  whether  the  society  itself,  under  the  facts 
proven,  is  a  fraternal  beneficiary  society,  the  meaning  of  a  provision 
in  a  contract  against  a  member  taking  his  own  life,  etc. 

On  the  question  of  the  validity  and  binding  effect  of  after-enacted 
by-laws  of  fraternal  beneficiary  societies,  it  is  said  by  the  court : 

"It  is  not  claimed  that  there  is  an  inherent  power  in  the  asso- 
ciation, by  the  adoption  of  a  by-law,  to  work  such  radical  changes 
in  its  existing  contracts.  The  power  is  derived  from,  and  depends 
upon  the  stipulations  of  the  contract  at  the  time  it  was  made.  The 
stipulations  are  expressed  in  varying  terms,  and  several  of  them 
import  no  more  than  would  be  implied — the  observance  by  the  as- 
sured of  the  requirements  of  the  association,  such  requirements  as 
were  reasonable,  and  intended  to  promote  the  harmony  of  the  asso- 
ciation, and  the  purposes  and  objects  for  which  it  was  formed.  They 
import  also  obedience  to  the  by-laws,  so  far  as  reasonable,  consistent 
with  the  charter  and  law  of  the  land.  We  do  not  construe  them  as 
reserving,  or  as  intended  to  reserve  to  the  association  the  power 


THE    STATU    OF    ALABAMA  11 

to  change  or  avoid  its  contracts,  to  lessen  its  responsibilities,  or  to 
divest  its  members  of  rights.  This  is  not  the  proper  office  of  a 
by-law;  and  from  the  general  expressions  to  which  we  are  referring, 
it  cannot  be  fairly  presumed  or  intended  that  it  was  contemplated 
to  effect  the  members  by  other  than  such  by-laws,  as  it  was  within 
the  competency  of  the  association  to  enact.  But  in  addition 
to  these,  the  averment  of  the  plea  is,  that  the  certificate  was  accepted 
by  the  assured,  'subject  to  the  laws  of  the  order  now  in  force,  or 
which  may  be  hereafter  enacted  by  the  Supreme  Commandery.' 
These  are  words  of  large  signification,  and  clearly  express  that  the 
assured  consented  that  the  contract  should  be  subject  to  future,  as 
well  as  to  existing  b}--laws.  Pai-ties  may  contract  with  reference 
to  laws  of  future  enactment — may  agree  to  be  bound  and  effected 
by  them,  as  they  would  be  bound  and  effected  if  such  laws  wei-e  ex- 
isting. They  may  consent  that  such  laws  may  enter  into  and  form 
parts  of  their  contracts,  modifying  or  varying  them.  It  is  their 
voluntary  agreement  which  relieves  the  application  of  such  laws 
to  their  contracts  and  transactions  from  all  imputation  of  injus- 
tice." 

Supreme   Commandery  Knights  of  the   Golden  Rule  vs.   Ainsworth, 
December  Term,   18S2,  71  Ala.  436. 

"Void"  and  "Voidable"  Terms. 

Although  a  policy  of  insurance  stipulates  that  a  breach  of  its  con- 
ditions by  the  insured  shall  render  it  void,  this  word  "void"  is 
to  be  considered  used  in  the  sense  of  voidable,  as  any  conditions 
inserted  in  a  policy  which  are  for  the  benefit  of  the  insurer  maj'^  be 
waived  by  it. 

Georgia  Home  Insurance  Co.  vs.  Allen  (1898),  119  Ala.  436. 

Waivers  of  Statutes  of  Limitation  Void. 

Section  2802  Code  of  1896,  provides  that  any  agreement  or  stipu- 
lation whereby  the  time  of  bringing  of  any  action  is  limited  to  a 
time  less  than  that  prescribed  by  law  for  the  bringing  thereof,  is 
void,  and  it  was  held  that  though  an  insurance  ])olicy  contained  a 


12  FRATERNAL   SOCIETY   LAW 

clause  prohibited  by  this  ISectiou  wliich  was  valid  iu  the  State 
where  the  contract  was  made,  nevertheless  it  was  unenforeible  under 
the  laws  of  Alabama. 

Galliher  vs.   State  Mut.  Life   Ins.  Co.,   Supreme  Court  ot  Alabama, 
April,  1907.  43  So.  833. 

Prohibited  Occupations — Saloonkeepers — Who  are? 

A  certificate  issued  to  a  member  of  the  American  Guild  in  the 
amount  of  $5,000  provided  therein  that  if  the  member  at  the  time 
of  his  death  should  be  a  saloonkeeper  or  bartender  that  only  one- 
half  of  the  amount  of  the  certificate  should  be  paid.  The  evidence 
showed  without  conflict  that  at  the  time  of  the  death  of  the  member, 
he  was  the  manager  of  a  saloon  iu  which  intoxicants  were  sold,  that 
his  wife  was  the  owTier  of  the  saloon  but  that  she  took  no  part  in 
the  management  thereof,  which  was  managed  for  her  by  her  hus- 
band, the  member;  that  the  member  never  served  or  mixed  any 
drinks  at  the  bar  but  that  he  employed  the  help,  purchased  the 
stock,  deposited  the  receipts  and  generally  managed  the  business. 
The  sole  question  to  be  determined  by  the  court  was  whether  or  not 
the  member,  under  the  facts,  was  a  saloonkeeper  in  contemplation 
of  the  provision  iu  the  contract.  The  court  said,  citing  Webster  as 
authority  that  a  saloon  is  "popularly  a  piiblic  room  for  specific 
usage.  especi.ill>   l).ii- rroin  or  grog-shop,  as  a  drinking  saloon."  etc. 

"It  is  difficult  to  see  why  Mr.  Solomon  was  not  the  keeper  of  this 
saloon.  If  he  was  not,  no  one  was.  He  performed  all  the  duties  of 
a  saloonkeeper.  If  he  had  been  called  the  governor  or  superintend- 
ent of  the  saloon,  it  would  not  have  altered  his  relation  to  it.  He 
would  have  been  its  keeper,  as  much  so  as  if  he  had  been  called 
a  saloon  keeper.  It  would  have  been  the  same  thing  by  another 
nanu\  Such  a  keeper  does  not  necessarily  mix  and  serve  drinks 
over  the  counter,  but  may  and  well  might  attend  to  more  improtant 
matters  connected  with  the  keeping  of  the  establishment.  Saloon- 
keepers and  bartenders  where  intoxicants  are  sold,  and  hotel  keep- 
ers who  attend  their  own  bars,  were  among  those  excepted  from 
the  full  benefit  of  policies  in  the  Guild.    The  reason  for  such  excep- 


THE    STATE    OF   ALABAMA  13 

tion  was  such  risks  were  more  hazcnrdoiis  than  of  those  not  similarly 
employed. ' ' 

Solomon  vs.  American  Guild,  Supreme  Court  of  Alabama.  June,  1907, 
44  So.  387. 


14  FRATERNAL    SOCIETY   LAW 


THE 


DISTRICT  OF  ALASKA. 


CHAPTER  2. 

Fraternal  societies  are  by  law  exempt  from  the  operation  of  the  in- 
surance laws  of  the  District  of  Alaska,  such  exemption  being  pro- 
vided for  in  the  Civil  Code  approved  June  6,  1900.  Chapter  36  of 
said  Code  deals  with  insurance  and  is  here  reproduced. 

Section  360.  No  company,  corporation,  or  association,  or  firm, 
or  individual  shall  be  permitted  to  transact  a  life,  fire,  or  marine 
insurance  business  in  the  District  until  he  or  it  has  filed  in  the 
Office  of  the  Secretary  of  the  District  a  certificate  by  the  Secretary 
of  State  or  other  proper  officer  of  some  State  of  the  United  States, 
setting-  forth  that  the  said  company,  corporation,  association,  firm. 
or  individual  has  been  qualified  to  carry  on  the  business  of  insur- 
ance in  such  State  in  accordance  with  the  laws  thereof. 

Section  361.  No  insurance  company,  corporation,  association,  firm 
or  individual  shall  be  permitted  to  transact  a  life,  fire,  or  marine 
insurance  business  in  the  District  until  it  shall  have  filed  with  the 
Clerk  of  each  Division  of  the  District  Court  a  power  of  attorney 
which  shall  set  forth  that  such  company  is  a  corjwration  or  duly 
organized  insurer  (naming  the  principal  \)\;\co  of  business  of  the 
company  and  principal  place  of  business  for  the  Pacific  coast), 
which  power  of  attorney  shall  authorize  a  citizen  and  resident  of 
the  District  to  receive  and  accept  service  in  any  proceeding  in  a 
court  of  .iustice  of  the  District.  If  any  attorney  of  any  insurance 
company  appointed  under  the  provisions  of  this  section  shall  re- 
move from  the  district  or  become  disqualified  in  any  manner  from 
accepting  service,   and  if  any  citizen   or  resident  of  the  District 


THE    DISTRICT    OF    ALASKA  15 

shall  have  any  claim  by  virtue  of  auy  iusurance  policy  issued  by 
any  such  company  not  represented  by  attorney  in  the  district,  valid 
service  may  be  made  on  such  company  by  service  on  the  Clerk  of 
the  District  Court  or  any  division  thereof:  Provided,  In  such  case 
the  Clerk  of  the  District  Court  shall  immediately  notify  such  com- 
pany and  the  principal  agent  for  the  Pacific  Coast,  inclosing  a  copy 
of  the  service  by  mail,  postpaid :  And  provided  further,  In  such  case 
no  jiroceedings  shall  be  had  within  sixty  days  after  such  service 
on  the  clerk. 

Section  362.  All  orders  or  secret  societies,  such  as  Masons.  Odd 
Fellows,  Druids,  Knights  of  Pythias,  Ancient  Order  of  United  Work- 
men, Modern  Woodmen  of  America  and  other  benevolent,  fraternal, 
or  cooperative  societies  associated  or  incorporated  for  the  sole  pur- 
pose of  mutual  protection  and  relief  of  its  members  only,  and  for 
the  ])ayment  of  stipulated  sums  of  money  to  the  families  of  deceased 
members,  or  for  pro|)erty  of  its  members  only  destroyed  by  fire,  are 
hereby  declared  not  to  be  fire  or  insurance  companies  in  the  sense 
and  meaning  of  this  chapter,  and  they  are  exempt  from  the  provis- 
ions hereof. 

Section  363.  The  provisions  of  this  chapter,  under  either  term  or 
designation  of  company,  corporation,  association,  firm,  or  individual 
in  either  case,  where  either  term  or  designation  is  used,  shall  apply 
to  any  insurer,  company  or  corporation,  association,  firm,  or  indi- 
vidual, engaged  as  an  insurer  or  who  may  hereafter  engage  as  in- 
surers in  the  District,  or  who  may  engage  in  offering  or  affording 
indemnity  against  the  casualties  of  fire  or  life. 

Section  364.  Any  officer,  agent,  or  emplo,yee  of  anj^  insurance 
company  or  other  person  violating  any  of  the  provisions  of  this 
chapter  shall  be  fined  not  less  than  one  hundred  nor  more  than  five 
hundred  dollars,  and  in  default  of  payment  of  such  fine  shall  be 
imprisoned  not  less  than  ten  days  nor  more  than  six  months. 

Section  365.  The  Secretary  of  the  District  shall  collect  from  each 
company  or  person  for  the  service  provided  in  this  chapter  the 
following  fees:  For  filing  certificate  of  qualification,  five  dollars;  for 
filing  power  of  attorney,  five  dollars.  *  »  #  # 

No  cases  are  contained  in  the  Alaska  Reports  which  concern 
fraternal  societies. 


16  FRATERNAL   SOCIETY   LAW 


THE 

STATE   OF   ARKANSAS. 

CHAPTER  3. 

[The  Section  numbers  correspond  to  those  in  Kirby's  (1904)  Digest 
of  the  Statutes  of  Arkansas.] 

Section  4326.  There  is  established  a  bureau  in  the  office  of  the 
Auditor  of  State,  to  be  known  as  "The  Insurance  Bureau,"  which 
shall  be  charged  with  the  execution  of  the  laws  of  the  State  in  rela- 
tion to  insurance. 

Section  4327.  The  Auditor  of  State  is  empowered  to  appoint  and 
commission  actuaries  and  examiners  to  issue,  and,  upon  cause  shown, 
to  revoke,  licenses  or  permits  to  transact  business  of  insurance ;  and, 
when  legal  cause  exists,  to  suspend  the  business  of  any  company  of 
this  State  or  any  company  of  another  State  doing  business  in  this 
State;  to  require  free  access  to  books  and  papers  belonging  to  any 
such  company  or  companies;  to  summon  and  examine  persons 
relative  thereto,  and  generally  to  do  any  and  all  things  which  the 
Insurance  Commissioner  was  by  laAv  heretofore  empowered  and  re- 
quired to  do. 

Section  4329.  The  seal  of  the  Auditor's  office  shall  be  the  seal  of 
the  Insurance  Department. 

Section  4351.  Every  incorporated  association,  order  or  society, 
doing  business  in  this  State  on  the  lodge  system,  with  ritualistic 
form  of  work  and  representative  form  of  government,  for  the  pur- 
pose of  making  provision  for  the  payment  of  benefits  in  ease  of  death, 
sickness,  temporary  or  permanent  physical  disability,  either  as 
the  result  of  disease,  accident  or  old  age,  formed  and  organized 
for  the  benefit  of  its  members  and  their  beneficiaries  be,  and  the 
same  is  hereby,  declared  to  be  a  "fraternal  beneficiary  order,  society 


THE    STATE    OF    ARKANSAS  ■  17 

or  association,"  ;uid  such  order,  socit't\'  or  iissociutioii  payiiii:  death 
benefits  may  also  create,  maintain,  a])i)ly  or  disburse  among  its 
.  membershi])  a  reserve  or  emeri^enev  fund  as  may  be  jjrovided  in 
its  constitution  or  ])y-la\vs:  provided,  however,  that  no  profit  or 
gain  shall  Ite  added  to  tlie  payments  made  by  a  member. 

Section  4352.  The  funds  from  which  the  payment  of  benefits,  as 
provided  for  in  section  4351,  shall  be  made  and  the  fund  from 
vphich  the  expenses  of  said  association  shall  be  defrayed,  shall 
be  derived  from  assessments,  dues  or  other  payments  collected 
from  its  members.  Snch  orders,  societies  or  associations  shall  be 
governed  by  this  Act,  and  shall  be  exempt  from  the  provisions 
of  all  insurance  laws  of  this  State,  and  no  law  hereafter  passed 
shall  apply  to  said  societies,  orders  or  associations,  unless  it  be 
expressh'  designated  therein. 

Section  4353.  Such  society,  order  or  association  doiu^'  busines.^ 
in  this  State,  shall,  on  or  before  the  first  day  of  March  of  each 
year,  make  and  file  with  the  Auditor  of  this  State,  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  thirty-first  of 
December  immediately  preceding,  together  with  a  copy  of  its  con- 
stitution and  laws  then  in  force,  which  annual  report  shall  be 
in  lieu  of  all  other  reports  required  by  any  other  law ;  such  reports 
shall  be  on  blanks  provided  by  the  Auditor,  and  shall  be  verified 
under  oath  by  the  duly  authorized  officer  or  officers  of  such  society, 
order  or  association,  and  shall  contain  such  information  as  the  Audi- 
tor, in  his  .judgment,  may  deem  necessary  for  the  welfare  of  the 
people  of  the  State,  and  shall  be  published,  or  the  substance  thereof, 
in  the  annual  report  of  the  Auditor  under  a  separate  head,  entitled 
"Fraternal  Beneficiary  Societies,"  and  for  the  filing  of  said  report 
said  society,  order  or  association,  shall  pay  a  fee  of  ten  dollars  and 
cost  of  pu])licatiou. 

Section  4354.  Every  fraternal  order  doing  business  in  this  State, 
which  insures  the  lives  of  its  members  against  accident,  or  sick 
benefit,  or  in  any  other  way,  shall,  in  addition  to  filing  their  annual 
statement  of  financial  condition,  give  to  the  State  of  Arkansas 
a  bond  in  the  sum  of  ten  thousand  dollars,  the  said  bond  to  be 
filed  with  and  approved  by  the  Auditor  of  State,  and  conditioned 
for  the  prompt  payment  of  all  moneys  coming  into  the  hands  of 
2 


Ig  FRATERNAL    SOCIETY   LAW 

its  officers  to  which  beneficiaries  are  eDtitled.  Said  bond  shall  be 
signed  by  at  least  three  citizens  of  this  State,  when  made  by  indi- 
viduals, who  shall  state  under  oath  that  they  are  possessed  of  prop- 
erty, situated  in  this  State,  over  and  above  all  lawful  exemptions, 
which,  taken  together,  will  be  equal  to  the  sum  of  the  bond;  or 
said  bond  may  be  made  by  any  surety  company  authorized  to  do 
business  in  this  State,  and  such  bond  shall  be  filed  annually. 

Section  4355,  Every  person  acting  as  agent  or  solicitor  for 
any  fraternal  order,  or  be  engaged  in  issuing  any  certificate  or  pol- 
icy upon  which  dues,  assessments  or  premiums  are  charged  or  col- 
lected, which  said  order  has  not  first  complied  with  the  require- 
ments of  this  Act  in  relation  thereto,  shall  be  deemed  guilty  of 
a  misdemeanor,  and.  upon  conviction,  shall  be  fined  fifty  dollars  for 
each  offense. 

Section  4356.  Any  such  orders  or  societies  incorporated  and  or- 
ganized under  the  laws  of  this  State,  may  provide  for  the  meeting 
of  its  supreme  legislative  or  governing  body  in  any  other  State, 
Province  or  Territory,  wherein  said  society  shall  have  subordinate 
lodges,  and  all  business  that  has  been  heretofore  or  may  hereafter 
be  transacted  at  such  meetings,  shall  be  as  valid  in  all  respects  as 
if  such  meetings  were  held  within  this  State;  provided,  however, 
that  the  principal  business  office  of  such  order,  society  or  asso- 
ciation shall  always  be  kept  within  this  State,  and  never  removed 
therefrom. 

Section  4357,  Any  such  fraternal  beneficiary  order,  society  or 
association  as  is  defined  by  this  Act,  organized  and  doing  business 
under  the  laws  of  another  State,  District,  Province  or  Territory, 
shall  be  admitted  to  transact  business  in  this  State  upon  the  same 
conditions  as  are  prescribed  by  the  laws  of  such  State,  for  the 
admission  of  like  orders,  societies  or  associations  organized  under 
the  laws  of  this  State  to  do  business  in  such  State,  District,  Prov- 
ince or  Territory.  That  all  laws  or  parts  of  laws  in  conflict  with 
this  Act  are  hereby  repealed,  and  this  Act  to  be  in  force  and  effect 
from  and  after  its  passage. 

Section  4378.  "Whenever  any  action,  cither  at  law  or  in  equity, 
is  instituted  on  a  policy  or  certificate  of  insurance  on  the  life  of  a 
person  aszaiiist  any  fraternal  society,  such  as  the  Knights  of  Honor, 


THE    STATE    OF   ARKANSAS  19 

Knights  of  Pythias,  or  like  societies,  in  the  courts  of  this  State, 
service  of  process  on  the  chief  officer,  or  in  case  of  his  absence, 
the  secretary  of  the  subordinate  lodge  or  society  through  which 
the  policy  was  issued  or  obtained,  or  on  the  chief  officer,  or  in  case 
of  his  absence  on  the  secretary  of  any  subordinate  lodge  in  this 
State  of  such  fraternal  society,  shall  be  a  good  and  valid  service 
on  such  lodge,  society  or  institution  issuing  the  policy,  the  same 
as  if  service  had  been  on  the  supreme  officers  of  said  lodge,  society 
or  institution. 

Suicide — Presumptions— Burden  of  Proof. 

"When  suicide  is  relied  on  as  a  defense  the  burden  of  proving 
it  is  upon  the  society.  "There  is  a  presumption  against  suicide 
or  dea1:h  by  any  other  unlawful  act,  and  this  presumption  arises 
even  where  it  is  showm  by  proof  that  death  was  self  inflicted.  It 
is  presumed  to  have  been  accidental  until  the  contrarv  is  made 
to  appear." 

Grand  Lodge  A.  0.  U.  W.  vs.  Banister,  Oct.  1,  1906,  80  Ark.  190. 

Coroner's  Verdict — Admissibility — Competency  to  Prove  Cause  of 
Death. 

The  verdict  of  a  coroner's  jury  that  the  member  suicided  is  not 
necessarily  prima  facie  of  such  fact,  but.  at  most,  maj'  be  considered 
by  the  trial  jury  along  with  other  testimony  in  the  case.  As  to  the 
admissibility  of  the  coroner's  verdict  and  its  value  as  evidence  to 
establish  the  cause  of  death,  the  Court  cited  many  authorities  pro 
and  con,  but  refused  to  determine  the  question. 

Grand  Lodge  A.  0.  U.  W.  vs.  Banister,  Oct.  1,  1906.  SO  Ark.  190. 

Forfeiture — Burden  of  Proof — Reinstatement. 

One  suing  to  recover  on  a  certificate  held  by  a  member  who  had 
been  suspended  for  non-payment  of  dues  assumes  the  burden  of  prov- 
ing such  member  to  have  been  reinstated. 

Woodmen  of  the  World  vs.  .lackson,  Nov.  5.  1906.  80  Ark.  419. 


20  FRATERNAL   SOCIETY   LAW 

Reinstatement — Good  Health — Estoppel. 

"Where  the  by-laws  stipulate  that  an  attempted  reinstatement  of 
a  suspended  member  shall  not  be  operative  unless  the  member  is  in 
fact  m  good  health,  the  receipt  by  a  local  officer  of  a  suspended 
member's  arrearages  will  not  estop  the  society  from  showing  that 
the  member  was  not  in  good  health.  No  estoppel  is  worked  by  the 
receipt  of  money  imder  such  circumstances. 

Woodmen  of  the  World  vs.  Jackson.  Nov.  5,  1906,  80  Ark.  419. 

Suit  on  Bond — Limitations — Provisions. 

In  a  suit  on  a  bond  given  by  the  Society  to  the  State,  as  required 
by  the  statute,  a  plea  was  interposed  that  the  suit  had  not  been 
begun  within  the  year  in  accordance  with  the  provisions  in  the 
policy.  The  Court  held  that  liability  upon  the  bond  is  predicated 
upon  liability  on  the  policy,  and  if,  as  a  matter  of  fact  there  is  no 
liabilitj'  on  the  policy,  then  there  can  be  no  recovery  on  the  bond, 
and  that  the  legislature  did  not  intend  to  enlarge  the  liabilities 
of  insurance  companies  and  sureties  b.v  requiring  that  the  company 
should  furnish  the  bonds  to  the  State.  The  limitation  clause  in 
the  policy  was  upheld. 

McCulloch  vs.   Mutual   Reserve  Fund   Life  Ass'n,  Feb.   17,   1906,   78 
Ark.   32. 

Date  of  Beginning  of  Liability. 

Liability  under  the  bond  to  the  State  is  fixed  when  the  loss  under 
the  policy  occurs,  and  not  from  the  date  when  the  amount  becomes 
payable. 

U.  S.  Fidelity  &  Guaranty  Co.  vs.  Fultz,  July  29,  1905,  76  Ark.  410. 
Proof  of  Loss — Waiver  of. 
Proof  of  loss  is  waived  by  denial  of  liability. 

Phoenix  Insurance  Co.  vs.  Boyette.  Nov.  4,  1905,  77  Ark  41; 
Planters   Mutual    In.surance    Ass'n   vs.    Hamilton,    Nov.    4,    1905,    77 
Ark.  27. 


THE    STATE    OF    ARKANSAS  21 

Death  in  Violation  of  Law — Defense  of. 

A  death  received  while  i-etroiitiug  in  good  faith  from  a  personal 
difficulty,  and  such  retreat  not  being  for  the  purpose  of  gaining 
an  advantage  to  renew  the  fight, — although  the  deceased  began  the 
assault  with  a  weapon  capable  of  inflicting  great  bodily  harm, — 
was  not  death  occurring  in  violation  of  any  criminal  law  within 
the  terms  of  a  certificate  providing  that  if  death  shall  result  "at 
the  hands  of  justice  or  in  violation  of  or  attempt  to  violate  any 
criminal  law,  then  there  shall  be  paid  only  such  sum  in  proportion 
to  the  whole  amount  of  the  certificate  as  the  matured  life  expectancy 
at  the  time  of  such  death  is  to  the  entire  expectancy  at  the  date  of 
acceptance  of  the  application"  according  to  the  American  Experi- 
ence Table  of  Mortality. 

Supreme  Lodge  Knights   of  Pythias  vs.  Bradley,   Dec.   10,   1904,   73 
Ark.  274. 

Warranties — Breach  of. 

Where  the  applicant  warranted  his  answers  and  statements  to  be 
full,  complete  and  true,  failing  which  the  policy  was  to  be  void, 
and  where  he  failed,  in  response  to  questions  on  the  subject,  to 
disclose  that  he  had  had  a  serious  illness  and  to  mention  the  names 
of  attending  phj'sicians,  etc.,  the  concealment  was  calculated  to 
deceive  the  society  and  it  was  held  to  have  voided  the  policy. 

Mutual    Reserve    Fund   Life    Ass'n   vs.   Cotter,    Oct.    22nd,    1904,    72 
Ark.   620. 

Arkansas  Contract. 

The  contract  evidenced  by  the  policy  is  held  to  be  an  Arkansas 
contract,  notwithstanding  the  stipulation  in  the  policy  that  it  is 
to  be  deemed  to  have  been  made  in  New  York.  The  Court  said, 
"The  stipulation  that  it  shall  be  governed  by  and  construed  only 
according  to  the  laws  of  the  State  of  New  York  does  not  consti- 
tute the  statutes  of  that  state  the  laws  by  which  the  validity  and 
effect  of  the  policy  is  to  be  determined,  but  makes  them  only  a 


22  FRATERNAL    SOCIETY   LAW 

part  of  the  contract  to  be  construed  and  enforced  as  any  other 
condition  in  the  policy." 

Mutual   Reserve    Fund   Life  Ass'n   vs.    Minehart,   Oct.    29,    1904,   72 
Ark.  630. 

The  Contract  and  Not  the  Character  of  the  Company  Determines 
Rights. 

The  right  of  one  claiming  under  a  mutual  benefit  policy,  in  a 
society"  created  for  benevolent  purposes,  is  to  be  ascertained  by  the 
contract  itself  and  without  regard  to  the  character  of  the  company 
sought  to  be  made  liable. ' 

■    Block  vs.  VaVlley  Mutual  Ins.  Ass'n,  52  Ark.  201; 
Johnson  vs.  Knights  of  Honor,  53  Ark.  255. 

Proving  By-laws. 

A  bj--la\v  of  the  Supreme  Lodge  Knights  of  Pythias  affecting 
the  Endowment  Rank  is  not  sufSciently  proven  when  the  Secretary 
of  the  Endowment  Rank  while  testifying  states  its  terms  and  pro- 
duces a  pamphlet  which  he  states  is  the  official  publication  of  the 
Constitution  and  Laws  of  the  Endowment  Rank,  although  he  says 
he  is  the  custodian  of  the  books  of  such  rank.  "It  seems  to  be  a 
case  where  the  litigant  has  proved  all  round  tlie  necessary  fact,  but 
has  not  proved  the  fact  itself." 

Supreme   Lodge   Knights   of   Pythias   vs.   Robbins,   March   22,    1902, 
70  Ark.   364. 

Effect  of  Suspension  of  Lodge  on  Members  Certificates. 

A  certificate  was  issued  to  a  iiKunber  of  a  local  lodge  which  cer- 
tificate provided  for  the  payment  of  a  sum  of  money  on  condition 
that  the  member  should  comply  with  all  the  laws  of  the  Society  and 
maintain  his  membership  in  the  subordinate  lodge.  It  was  shown 
that  the  subordinate  lodge  became  suspended  for  non-payment  of 
dues  required  of  it.  linl   I  lie  society  was  held  liable  upon  the  cer- 


THE    STATE    OF    ARKANSAS  23 

tificate,  notwithstanding  such  suspension ;  the  member  having  com- 
plied with  all  requirements  \ipon  him  by  the  payment  of  all  dvies 
and  assessments. 

United  Brothers  of  Friendship  vs.  Haymon,  March  3,  1900,  67  Ark. 
506. 

Precedent  Conditions. 

"Where  a  contract  of  life  insurance  contained  a  condition  thai 
the  policy  should  not  take  effect  until  the  first  premium  is  paid 
while  the  applicant  is  in  good  health,  the  insurer  is  not  bound  under 
such  policy  unless  such  condition  is  complied  with. 

Mutual  Life  Insurance  Co.  vs.  Parrish,  June  10,  1899,  66  Ark.  612. 

Assessment— Amount  of  Benefit — Burden  of  Proof. 

Where  the  contract  is  to  pay  a  certain  sum  provided  the  amount 
realized  from  one  assessment  shall  equal  that  sum,  the  society  is 
bound  to  pay  the  maximum  amount  in  the  absence  of  a  showing 
that  the  assessment  could  not  produce  such  sum  and  the  burden 
of  making  such  a  showing  i.s  upon  the  society. 

Masons  Fraternal  Accident  Ass'n  vs.  Riley,  April  30,  1S9S,  65  Ark. 
261. 

Heirs  at  Law — Dower  and  Distribution. 

The  Knights  of  Honor  issued  a  benefit  certificate  to  one  of  its 
members  agreeing  to  pay  the  sum  of  .$2,000  on  his  death  "to  his 
heirs"  at  law.  At  the  tiim^  when  this  certificate  was  issued  the 
member  -was  unmarried,  and  the  laws  of  the  society  authorized  cer- 
tificates to  be  issued  payaable  on  the  death  of  the  member  to  his 
family  as  he  might  direct.  Subsequently  these  laws  were  changed 
so  as  to  authorize  the  issuing  of  a  certificate  to  a  member  payable 
to  "some  member  or  members  of  his  family  or  person  or  persons 
dependent  upon  him  as  he  may  direct  or  designate  by  name  to  be 
paid  as  provided  by  general  law."     Subsequent  to  the  passage  of 


24  FRATERNAL    SOCIETY    LAW 

this  last  law.  the  member  iu  question  married  and  a  child  was  born 
of  the  marriage,  but  died;  and  then  the  member  died,  leaving  his 
widow  and  certain  brothers  and  sisters  as  his  nearest  of  kin  sur- 
viving him.  The  benefit  certificate  was  never  changed  and  the 
society  paid  the  money  into  court.  After  discussing  at  considerable 
length  various  authorities,  and  construing  the  word  "heirs."  the 
court  said : 

"Suffice  it  to  say  that  the  weight  of  authority  holds  the  word 
'heirs'  when  used  in  any  instrument  to  designate  the  persons  to 
whom  the  person's  property  is  transferred,  given  or  bequeathed 
and  the  context  does  not  explain  it.  means  those  who  would  under 
the  statute  of  distribution  be  entitled  to  the  personal  estate  of  the 
persons  of  whom  they  are  mentioned  as  heirs,  in  the  event  of  death 
and  intestaej'." 

Many  authorities  are  cited  in  support  of  this  proposition. 

The  court  held  that  there  was  a  distinction  between  distribution 
and  dower,  that  dower  was  in  the  natTu-e  of  a  lien  created  by  law 
in  the  property  of  the  husband  at  the  time  of  marriage  which  neces- 
sarily takes  precedence  over  the  other  subsequently  accruing  rights 
and  attaches  to  certain  property  and  is  satisfied  out  6i  it,  while  dis- 
tribution occurs  after  administration  and  payment  of  debts;  and 
the  estate  is  then  divided  between  the  heirs  or  legatees,  and  that  the 
■nndow  was  not  entitled  to  any  portion  or  distributive  share,  after 
her  dower  had  been  allowed. 

Johnson  vs.  Knights  of  Honor.  May,  1890.  53  Ark.  255. 

Interpleader — Society  Alone  Can  Claim  its  Non-liability. 

A  society  deposited  in  court,  under  a  bill  of  interpleader,  the 
amount  of  the  certificate  which  was  payable  to  heirs  of  the  deceased 
member,  and  it  made  certain  brothers  and  sisters  and  half  brothers 
and  half  sisters  defendants  together  with  the  surviving  widow.  It 
was  thereafter  claimed  that  neither  the  widow  nor  any  of  the  other 
defendants  were  entitled  to  take  the  amount  of  the  benefit.  The 
court  said  that  this  was  a  question  thai  could  be  raised  by  no  one 
except  by  the  society  and  that  it  did  not  raise  it  because  it  had  paid 
the  money  into  court  which  was  in  tiu^  nature  of  an  expression  of  its 


THE    STATE    OF    ARKANSAS  25 

will  tliat  the  amount  of  the  money  should  be  paid  to  the  member's 
heirs. 

Johnson  vs.  Knights  of  Honor,  May,  1890,  53  Ark.  255. 

Fraternal  Societies  vs.  Mutual  Societies. 

In  discussing  the  distinction  said  to  exist  between  mutual  life  in- 
surance concerns  and  fraternal  beneficiary  societies  the  Court  said: 

"We  have  found  no  cases  which  recognize  any  distinction  be- 
tween the  mutual  insurance  and  the  mutual  benefit  society  except  in 
states  where  the  statute  makes  a  difference.  But  regardless  of  the 
character  of  the  companj',  the  rights  of  persons  claiming  insur- 
ance arise  out  of  or  depend  upon  the  contract  and  must  be  ascer- 
tained by  and  fixed  by  the  contract,  althoiigh  the  object  of  the  com- 
pany in  entering  into  the  contract  may  be  benevolent,  this  purpose 
cannot  impart  any  new  meaning  to  the  unambiguous  terms  of  the 
contract.  When  the  Courts  are  invoked,  the  contract  measures,  the 
right  of  one  and  the  obligation  of  the  other  party,  and  relief  must  be 
granted,  if  at  all,  according  to  its  terms.  That  a  member  of  a  mutual 
benefit  society  may  change  the  beneficiary  named  in  the  certificate 
has  been  frequently  held,  not,  however,  because  of  the  character  of 
the  Societ}',  but  because  of  the  stipulation  contained  in  the  certificate 
expresslj'  authorizing  it.  In  most  cases  such  certificates  as  have 
been  the  subject  of  judicial  decision  contain  the  express  stipulation 
that  the  beneficiary  named  may  be  changed.  In  others,  the  articles 
of  association  or  by-laws  contained  such  provision  and  are  by  the 
terms  of  the  policy  made  a  part  of  it.  The  effect  in  each  case  is  the 
same. 

Block  vs.  Valley.  Mutual  Ins.  Assn.,  May.   1SS9,   52  Ark.  201. 

Failure  to  be  Initiated^Certificate  Void. 

In  the  organization  of  a  new  lodge,  an  applicant  for  membership 
in  the  Society  was  included  on  the  list  nf  members.  A  benefit  cer- 
tificate was  issued  by  the  Society  but  not  delivered  to  him.  He  was 
elected  to  office  in  the  Subordinate  Lodge,  hut  never  installed  and 


26  FRATEBKAL    SOCIETY   LAW 

died  before  being  either  obligated  or  initiated  into  the  Society,  but 
after  having  paid  the  amount  of  one  assessment.  It  was  held  that 
by  reason  of  the  applicant's  failure  to  be  initiated  and  obligated 
as  required  bj'  the  laws,  there  was  no  liability  under  the  certificate. 

Supreme  Lodge  Knights  and  Ladies  of  Honor  vs.  Johnson,  February, 
1907,  81  Ark.  512. 

Changes  of  Beneficiary  Not  Authorized. 

The  benefit  certificate  issued  by  the  Kjiights  and  Ladies  of  Uni- 
versal Brotherhood  payable  to  the  member's  surviving  children  was 
held  to  be  an  ordinary  contract  of  insurance  and  that  the  member 
had  no  power  to  change  the  beneficiaries  named  in  the  certificate 
unless  expressly  authorized  to  do  so  by  the  certificate  or  by  the  laws 
of  the  Society. 

Johnson  vs.  Hall,  December,  1891,  55  Ark.  210. 

Failure  to  Pay  Losses  Promptly — Penalties. 

The  act  of  March  29th,  190.5,  imposing  penalties  and  attorneys 
fees  upon  insurance  companies  and  societies  for  failure  to  pay  their 
contracts  within  the  time  specified  in  same,  was  held  not  to  ai)ply 
to  contracts  in  existence  at  the  time  when  the  act  went  into  effect. 

Arkansas  Mutual  Fire  Ins.  Co.  vs.  Wolverton,  April.  1907,  82  Ark  476. 

Waiver — Election  to  Office  of  Applicant  Before  Initiation. 

An  applicant  for  membership  iu  the  Kjiights  and  Ladies  of  Honor 
died  before  being  obligated  or  initiated.  It  was  contended  that  the 
subordinate  lodge,  by  reason  of  having  elected  the  applicant  to  an 
olifice  in  the  lodge,  had  waived  the  provision  of  the  society  requiring 
that  applicants  be  obligated  and  initiated.  In  passing  upon  this 
question  the  Court  said : 

"If  it  be  conceded  that  the  subordinate  lodge  had  the  power  by 
any  action  of  that  body  to  waive  these  positive  requirements  of  the 
Constitution  and  laws  of  the  Supreme  Lodge,  the  mere  election  to 


THE    STATE    OF    ARKANSAS  27 

office  ill  the  lodge  of  an  ai)plicant  for  membership  where  he  was 
never  admitted  and  never  attended  meetings  or  performed  any 
duties  of  the  office,  could  not  operate  as  a  waiver  of  any  prere(|uisites 
to  membership  in  the  order.  Certainly  it  could  not  be  considered  a 
waiver  until  there  was  an  acceptance  of  the  office  and  installation 
therein. 

Supreme  Lodge  Knights  and  Ladies  of  Honor  vs.  Johnson,  February, 
1907,  81  Ark.  512. 

Forfeiture  for  Failure  to  Pay. 

As  to  the  facts  in  a  case  where  the  contract  had  been  forfeited 
for  non-payment  of  dues,  see 

Odd  Fellows'  Benefit  Assn.  vs.  Burton,  Supreme  Court  of  Arkansas, 
July,  1907,  104  S.  W.  163. 

Waiver — Defects  in  Application. 

Where  an  application  is  accepted  which  upon  its  face  shows  de- 
fects, the  Society  is  held  to  waive  such  defects. 

Fidelity    Mutual    Life    Insurance    Co.    vs.    Beck.    Supreme    Court   of 
Arkansas,  July,  1907,  104  S.  W.  533. 

Warranty — Increase  of  Risk. 

Where  the  answers  to  questions  in  an  application  were  warranted 
true,  and  the  matter  inquired  of  would  affect  the  assumption  of  the 
risk,  the  warranty  is  material  even  though  the  death  may  have 
been  caused  from  some  other  reason  entirely  disconnected  with  the 
matter  inquired  about. 

Fidelity  Mutual  Life  Ins.  Co.  vs.  Beck,  Supreme  Court  of  Arkansas, 
July,  1907,  104  S.  W.  533. 

Parole  Contract  of  Insurance. 

.  Everything  had   been    done   to   complete   the   contract   of   insur- 
ance which  was  required  to  be  done  except  the  issuance  and  deliv- 


28  FRATERNAL   SOCIETY   LAW 

ery  of  the  certificate.  The  certificate  was  not  issued,  but  the  Court 
held  that  there  was  a  parole  contract  for  insurance  made  and  that 
the  same  was  valid. 

Knights  of  Maccabees  of  the  World  vs.  Gordon,  Supreme  Court  of 
Arkansas,  May,  1907,  102  S.  W.  711. 


THE    TERRITORY    OF    ARIZONA  29 


THE 

TERRITORY   OF   ARIZONA. 


CHAPTER  4. 

There  is  no  statute  law  in  force  in  the  Territory  of  Arizona  that 
concerns  fraternal  societies.  The  Secretary  of  State  of  Arizona 
rules  that  "there  are  no  requirements  for  the  transaction  of  busi- 
ness in  Arizona  by  fraternals. " 

Situs  of  Contract  and  Suits — Garnishment. 

Plaintiff  in  Arizona  sued  defendant  on  an  insurance  policy.  The 
defendant  set  up  as  defense  that  it  was  engaged  in  business,  with 
its  offices  in  California,  where  its  general  manager  conducted  all 
business  and  kept  the  funds  for  the  payment  of  losses;  and  that 
after  receipt  of  plaintiff's  proofs  of  loss,  the  plaintiff's  Calif oi'nia 
creditors  brought  suit  against  it,  service  being  had  on  plaintiff'  by 
publication,  and  garnished,  under  the  attachment  laws  of  California, 
the  amount  due  ])la!iitiff  iijioii  liis  jioliey  of  insurance,  and  that 
upon  judgment  against  plaintiff  in  said  suits  defendant  discharged 
its  obligation  to  the  plaintiff'  by  paying  to  plaintiff's  creditors  in 
garnishment  proceedings  the  full  amount  due  plaintiff  upon  his 
policy.  It  was  held  that  the  situs  of  the  fund  was  in  California, 
subject  to  garnishment  by  plaintiff's  creditors,  and  therefore,  that 
payment  under  such  garnishment  proceedings  was  a  complete  de- 
fense to  plaintiff's  action. 

National  Fire  Insurance  Co.  vs.  Ming,  Marrli  2S.  1900.  7  Ariz.  6;   60 
Pac.  720. 


30  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  CALIFORNIA. 

CHAPTER  5. 

There  is  but  one  section  of  the  Statute  Law  of  California  that 
relates  to  Fraternal  Benefit  Societies,  and  that  is  Section  630  Art. 
16  of  the  Political  Code  and  is  contained  in  the  Act  of  the  Legis- 
lature approved  March  8,  1907.    The  Section  reads  as  follows : 

"Section  630.  Secret  or  fraternal  societies,  lodges,  or  councils 
incorporated  or  organized  for  the  purpose  of  mutual  pi-otection 
and  relief  of  their  members  and  for  the  payment  of  stipulated 
sums  of  money  to  their  members  or  to  the  beneficiaries  of  deceased 
members  which  conduct  their  business  and  secure  membership  on 
the  lodge  system  exclusively,  having  ritualistic  work  and  cere- 
monies in  their  societies,  lodges,  or  councils,  and  all  mutual  or 
benefit  associations  organized  or  foi-med  and  composed  of  member's 
of  any  such  society,  lodge  or  council  exclusively,  are  exempt  from- 
the  provisions  of  all  the  insurance  laws  of  this  State." 

Creation  of  Classes — Discrimination, 

"The  essential  principle  upon  \\']iich  co-ojierative  associations  on 
the  assessment  plan-'^e  based,  is  that  there  will  be  a  constant  in- 
vigoration  of  the  association  by  the  acquisition  of  new  members, 
that  it  shall  be  a  going  concern  for  the  advantage  of  all,  and  that 
every  member  of  the  association  will  be  given  the  benefit  of  the 
average  mortality  of  the  entire  membership  in  force  at  the  last  death 
prior  to  the  assessment;  and  it  was  necessarily  upon  this  tlu'ory 
that  the  earlier  member.s  of  the  association  .joined  it.  They  an- 
ticipated the  benefit  which  wovild  result  from  a  lower  avei'age  mor- 
tality throiifrli  the  c-onstaiit  acfpiisil  inn  dl'  tlirsi'  in'W  mciiihers.  Miid 


THE    STATE    OF    CALIFOKMA  31 

it  was  this  benefit  wliieh  was  secured  to  Benjamin  as  one  of  the 
earliest  members,  by  the  lu'ovisioii  in  his  contract  which  called 
for  an  assessment  'niHin  the  cntiri'  incmljership  in  force  at  the  date 
of  the  last  death  claim,  same  to  be  apportinni'd  among-  the  members 
according  to  the  age  of  each  member,'  He  was  entitled  to  this 
benefit  which  would  accrue  from  the  constant  acquisition  of  such 
members.  This  acquisition  would  naturally  create  a  lower  average 
of  mortality  among  the  entire  membership  and  consequently  a 
smaller  cost  would  have  to  be  sustained  by  each  member,  where 
the  assessment  to  meet  death  claims  was  distributed  over  the  entire 
membership,  equally  apportioned  as  to  amount  according  to  the 
respective  ages  of  the  members. 

"The  right  to  segregate  members  into  the  15-year  class,  as  Avas 
done  here,  was  detei'mined  by  the  supreme  courts  of  ^linnesota 
and  North  Carolina,  adversely  to  the  contention  of  this  appellant. 
In  this  case  the  suits  were  brought  against  this  same  appellant  by 
members  of  this  association  who  had  been  segregated,  with  Ben- 
jamin, into  this  15-year  class  to  recover  damages  for  cancellation  of 
their  policies  for  non-payment  of  a  mortuary  call  similar  to  the 
one  under  consideration  here,  levied  under  the  same  resolutions 
advancing  the  member  of  that  class  along  to  attained  ages  and  as- 
sessing them  according  to  rates  fixed  for  such  ages. 

"In  these  decisions  it  was  held,  that  the  change  in  the  rate  of 
assessment  to  advanced  age,  and  which  was  to  apply  only  to  those 
members  who  entered  prior  to  1890,  placed  in  the  class  of  those 
solely  for  the  purpose  of  such  assessment,  was  an  inequitable  and 
arbitrary  discrimination  against  that  class,  and  violative  of  their 
contract  of  insurance." 

The  court,  in  this  ease,  is  careful  to  say  that,  "All  that  we  decide 
in  the  present  case  is,  that  the. defendant  has  violated  its  contract 
with  the  ))laintifF  in  a  material  matter,  whereb.v  the  plaintiff  having 
.suffered  substantial  injury'  is  entitled  to  substantial  damages.  We 
do  not  decide  that  a  mutual  insurance  eompanj-,  or  any  other  kind  of 
insurance  company,  cannot  issue  policies  of  divers  kinds  and  classes, 
if  so  authorized  by  its  charter ;  nor  do  we  decide  that  the  member  of 
a  purely  mutual  association  is  not  bound  by  all  reasonable  b.v-laws 
and  changes  lawfnlh-  made  therein." 


32  FRATERNAL    SOCIETY    LAW 

The  court  discusses  the  following  cases  against  the  same  in- 
surance society: 

Ebert  vs.  Mutual  Reserve  Fund  Life  Ass'n,  81  Minn.  116. 

Straus  vs.  Mut.  Reserve  Fund  Life  Ass'n,  126  N.  C.  971;  83  Am.  St. 

R.  699.     , 
Gaut  vs.  Mut.  Res.   Fund  Life  Ass'n,   121   Fed.  403. 

The  above  quotations  are  made  by  reason  of  the  importance  of  the 
decisions  upon  the  questions  submitted,  notwithstanding  the  fact 
that  the  insurance  company  at  bar  was  not  a  fraternal  beneficiary 
society,  but  was  probably  a  mutual  assessment  society  only. 

Benjamin  vs.   Mut.  Reserve  Fund   Life  Ass'n,   Jan.   2nth,   1905,   146 
Cal.  34. 

Forfeiture — Attempted  Restoration. 

The  laws  of  a  fraternal  benefit  society  are  part  of  the  contract, 
and  M'here  these  laws  provide  for  the  payment  of  assessments  for 
death  losses,  and  for  the  suspension  of  a  member,  and  forfeiture  of 
his  certificate  upon  his  failure  to  pay  the  assessments  as  levied,  and 
also  for  the  restoration  of  the  member  and  his  certificate  vipon  con- 
ditions which  are  named  in  the  laws  and  which  include  payment 
of  all  assessments,  and  the  vote  of  restoration  by  a  subordinate  lodge, 
it  was  held  that  no  action  can  be  maintained  by  the  beneficiary  iipon 
such  a  certificate,  which  has  been  forfeited  for  non-payment  of  the 
assessments,  and  not  renewed  as  provided  b.\'  the  by-laws,  notwith- 
standing that  all  assessments  required  have  been  paid,  and  the 
death  of  the  member  occurred  before  the  vote  of  the  lodge  could  be 
had  restoring  him. 

Butler  vs.  Grand  Lodge  A.  O.  U.  W.,  Feb.  2.  190.'S.  14R  Cal.  172 

Warranty — Doubtful  Language. 

Notwithstanding  the  application  for  a  certificate  of  life  insur- 
ance in  a  fraternal  society  purports  to  contain  a  warranty  of  the 
truthfulness  of  llic  stali'iiients  as  to  lieallli  nl'  llu'  npplic.-mt   and  to 


THE    STATE    OF    CALIFORNIA  33 

agree  that  their  falsity  .shall  avoid  the  certificate,  where  the  cer- 
tificate does  not  expressly  mention  the  application,  hut  expressly 
provides  that  it  "is  subject  to,  and  be  construed  and  controlled  by 
the  laws  of  the  order,"  the  laws  are  a  part  of  the  contract;  and 
where  they  make  the  api)lication  also  a  part  of  the  contract,  but  ex- 
pressly provide  that  any  wilfully  erroneous  statements  or  intentional 
concealments  of  material  facts  therein  shall  avoid  the  certificate, 
the  contract  is  to  be  construed  against  a,  strict  warranty  and  for- 
feiture of  the  insurance,  for  mere  untruthfulness  of  the  statements. 
Warranties,  on  account  of  their  stringent  character,  are  not  favored 
in  law,  and  no  construction  will  be  indulged  in  which  has  the  effect 
of  a  strict  warranty  of  the  literal  truthfulness  of  statements,  where 
the  terms  of  the  contract  are  conflicting  or  inconsistent,  or  render 
the  intention  to  make  such  warranty  doulitfid. 

O'Connor  vs.  Grand  Lodge  A.  0.  U.  W.,  April  4th,  1905,  146  Cal.  484. 

Dependency  of  Beneficiary. 

A  person  not  related  to  a  member  of  a  fraternal  society,  who  has 
no  legal  or  moral  claim  upon  him,  beyond  the  member's  voluntary 
contributions  to  her  supp(n-t  during  his  life,  which  he  might  have 
ceased  at  any  time,  and  who  is  a  married  woman,  having  a  husband 
capable  of  supporting  her,  and  is  not  dependent  upon  such  member 
within  the  meaning  of  a  by-law  allowing  a  person  to  designate  as 
beneficiary  in  his  certificate,  persons  "who  shall  be  dependent  upon 
him"  is  not  entitled  to  take  the  benefit.  The  "dependence"  which 
is  there  meant  is  a  dependence  resting  upon  some  moral,  legal,  or 
equitable  ground  and  not  a  dependence  which  is  only  a  matter  of 
favor,  founded  upon  the  mere  whim  of  the  member,  and  which 
may  be  cast  aside  without  violating  any  legal  or  moral  obligation. 

Caldwell  vs.  Grand  Lodge  A.  O.  U.  W.,  Nov.  10th.  1905,  14S  Cal.  195. 

By-laws  Part  of  Contract — —After-enacted  Laws. 

Where  a  member  when  he  joined  the  society  agreed  specially  to 
abide  by  and  conform  to  the  bv-laws  in  force,  and  tho.se  that  mav  be 


34  FRATERNAL    SOCIETY    LAW 

subsequently  adopted,  his  compJiance  to  after-euacted  by-l;i\vs  was 
a  condition  upon  which  he  was  entitled  to  participate  in  the  bene- 
ficiary fund  of  the  society;  and  the  by-laws  in  existence  when  his 
certificate  matured,  and  not  for  any  reason  invalid,  enter  into  and 
govern  all  his  rights  and  relations  to  the  society. 

Caldwell  vs.  Grand  Lodge  A.  O.  U.  W.,  Nov.  10th,  1905,  14S  Cal.  195. 

Right  to  Name  Certain  Beneficiaries  Not  a  Vested  Right. 

Where  the  original  by-laws  allowed  any  person  to  be  named  by 
the  member  as  a  beneficiary,  a  change  made  in  the  by-laws  fequiring 
members  to  designate  some  member  of  the  family,  or  some  one  re- 
lated by  blood,  or  some  one  dependent  upon  him  is  reasonable ;  and 
after  such  by-laws  went  into  effect,  the  member  had  no  right  to 
name  a  beneficiary  other  than  one  of  the  classes  therein  designated. 

Caldwell  vs.  Grand  Lodge  A.  0.  U.  W.,  Nov.  10th,  1905,  14S  Cal.  195. 

False  Statements  in  Application — Act  of  Agent  Estops  Society. 

Where  an  applicant  for  a  certificate  in  a  fraternal  society  in  good 
faith,  as  a  matter  of  fact  makes  truthful  answers  to  questions  con- 
tained in  the  application  or  medical  examination,  but  his  answers, 
owing  to  the  fraud,  negligence,  or  mistake  of  the  representative  of 
the  society  in  filling  out  the  application,  are  incorrectly  transcribed, 
the  society  is  estopped  to  assert  their  falsity. 

Lyon  vs.  United  Moderns.  Jan.  17,  1906,  148  Cal.  470. 

Proof  of  Death — Requisites  of. 

A  certificate  requiring  "satisfactory  proof  of  the  death  of  the 
member,  and  of  the  identity  and  right  of  claimant,  and  the  validity 
of  the  claim,"  cannot  be  reasonably  construed  as  requiring  a  show- 
ing as  to  the  validity  of  the  certificate,  or  that  there  must  be  such 
showing  as  to  reasonably  satisfy  defendant's  officers  that  the  de- 
fendant had  no  good  defense  against  the  claimant  on  the  ground  of 
misrepresentation.    Proof  of  death  and  proof  of  the  clainuint's  right 


THE    UTATE    OF    CALIFORNIA  35 

and  identity  to  such  benefit  as  was  stipulated  bj'  the  certificate  were 
the  only  requisites. 

Lyon  vs.  United  Moderns,  Jan.  17,  1906,  148  Cal.  470. 

Beneficiary — Sister-in-law. 

Where  a  benefit  certificate  in  the  American  Council  of  the  Order 
of  Chosen  Friends  was  made  payable  to  the  wife  of  a  brother  of  a 
member,  not  as  a  gift,  but  in  consideration  of  the  care  and  support 
by  the  husband  and  wife  of  the  member's  children,  and  in  satis- 
faction of  indebtedness  of  the  member  to  the  husband,  and  of  the 
payment  of  future  assessments  by  the  husband  upon  the  certificate, 
the  wife  was  held  to  be  a  proper  beneficiary ;  but  iu  this  case,  there  is 
no  real  contest  involving  the  sister-in-law's  claim,  the  question  before 
the  court  being  whether  or  not  the  proceeds  of  the  certificate  which 
had  been  collected  and  invested  in  real  estate,  was  the  separate  prop- 
erty of  the  wife,  or  the  property  of  the  community,  estate  of  the 
husband  and  wife. 

Bollinger  vs.  Wright.  May  16th,  1904,  143  Cal.   292. 

Contract  Determined  Solely  by  the  Laws. 

In  an  action  by  a  member  of  the  Brotherhood  of  Railroad  Train- 
men, an  unincorporated  fraternal  society,  it  was  held  that  his  right 
to  recover  must  be  measured  by  his  contract,  which  must  be  deter- 
mined by  the  constitution  and  by-laws  of  the  association,  to  which 
he  had  agreed  to  be  bound.  In  such  case,  before  any  right  of  re- 
covery against  the  society  could  be  shown,  it  was  held  that  the 
approval  of  the  beneficiary  board  was  required  as  a  precedent  con- 
dition to  the  right  of  the  claimant  for  benefits,  and,  as  the  beneficiary 
board  had  rejected  the  plaintiff's  claim,  a  non-suit  was  properly 
granted. 

Poole  vs.   Brotherhood   of  Railroad  Trainmen,  June  21st.   1904.   143 
Cal.  650. 


;^(5  FRATERA'AL    SOCIETY    LAW 

Beneficiary  a  Creditor — Attachment — Preference. 

Upon  the  death  of  a  member  of  a  fraternal  society,  the  beneficiary 
under  the  certificate  suing  after  the  death  of  the  member,  is  held 
to  be  a  creditor  of  the  society,  and  to  have  the  right  to  attach  a 
fund  belougiug  thereto  in  this  State.  In  this  case  the  beneficiary 
claimed  the  fund  that  the  receiver  of  the  Supreme  Council  of  the 
Order  of  Chosen  Friends  also  claimed,  and  the  court  decreed  that 
the  domestic  creditor  had  the  preference,  and  refused  to  inquire 
into  the  legality  of  the  appointment  of  a  receiver,  or  as  to  his  rights 
under  the  laws  of  the  State,  the  court  saying,  in  effect,  that  no 
statute  nor  rule  of  comity  requires  the  rights  of  a  domestic  attaching 
creditor  to  be  set  aside  in  deference  to  a  foreign  receiver  claiming 
imder  the  laws  of  another  State. 

Lackmann  vs.  Supreme  Counoil  Order  of  Chosen  Friends  et  al..  Jan. 
26th,   1904.   142  Cal.   22. 

Beneficiary — Validity  at  Inception. 

Where  a  fraternal  society  jirovided  in  its  by-laws  that  members 
might  designate  some  one  related  by  blood,  or  dependent,  as  bene- 
ficiary, and  where  the  mother  of  an  unmarried  member  has  been  des- 
ignated, such  designation  being  valid  at  the  time  when  made,  if  left 
imchanged  by  the  member  after  marriage,  it  was  valid  at  his  death, 
and  the  mother  is  entitled  to  the  benefit  to  the  exclusion  of  the 
widow  and  children  of  the  member. 

Sheehan  vs.  .Journeymen  Butchers'  Protective  Benevolent  Association. 
March  14th,  1904.   142  Cal.  4S9. 

Beneficiaries — Extension  of  Class  by  Statute. 

A  certificate  of  incorporation  of  a  fraternal  society  stating  its 
object  to  be  "to  relieve  the  distress  of  widows  and  orphans,"  was 
held  not  to  be  construed  ms  limiting  (lie  b(Miefits  of  the  association 
to  till'  widows  and  ()r|)li;uis  t\\'  dcccasi'd  nienihors,  as  it  may  by  its 
eonstitiition  and  by-laws,  adopted  in  confoi-niily  with  \\\o  stntnte, 
f'xfr'iul  \\^  Iir'iii'fils  1(1  (ilhiT  persons. 


THE    STATE    OF    CALIFORNIA  37 


Sheehan  vs.  .Toiuneymen  Butchers'  Protective  and  Benevolent  Ass'n, 
March   1-1.   l'.M)4.   142  Cal.  489. 

Members  Required  to  Resort  to  Remedies  Provided  in  Laws. 

Although  as  a  general  rule,  one  who  has  become  a  member  ol'  a 
fraternal  society,  is  not  entitled  to  an  appeal  to  the  courts  for  re- 
dress, until  he  has  first  applied  to  the  society  by  the  proper  pro- 
cedure, and  has  exhausted  all  lawful  remedies  provided  by  the 
laws  of  the  society ;  yet  where  sick  benefits  were  sought  on  behalf 
of  an  insane  member  by  his  wife  as  guardian  of  his  person  and 
estate,  and  the  society  violated  its  own  laws  in  not  giving  her  any 
notice  or  opportunity  to  produce  testimony  in  behalf  of  her  husband, 
but  an  adverse  decision  was  made  against  him,  the  court  has  juris- 
diction to  hear  and  determine  the  merits  of  the  controversy. 

Schou    vs.    Sotoyome    Tribe    No.    12,    Improved   Order   of   Red    Men. 
Sept.   18,   190,3,   140  Cal,  254, 

Fraternal  Society  Not  a  Charity. 

An  incorporated  fraternal  society,  conducting  a  private  hospital 
for  the  benefit  of  its  members,  which  treats  sick  members  in  con- 
sideration of  payment  of  dues  by  them,  and  receives  other  sick 
patients  for  an  agreed  consideration,  is  liable  to  one  of  the  latter 
for  damages  caused  by  the  negligence  of  a  surgeon  employed  by 
the  hospital,  at  a  salary  paid  by  the  society;  while  the  by-laws  pro- 
vided for  charity  as  one  of  the  ob.iects  of  the  hospital,  nevertheless, 
this  does  not  render  the  society  a  charitable  one,  where  there  is 
nothing  in  them  requiring  the  application  of  the  funds  of  the  society 
for  charitable  i>urposes. 

Brown  vs.  La  Societe  Francaise  De  Bienfaisance  Mutuelle,  Feb,   5, 
1903,   138  Cal,  475, 

Statute  of  Limitations — Release  From  by  Acknowledgment  of  Claim. 

Where  the  only  defense  to  an  action  upon  a  beneficiary  certificate 
by  the  wife  of  the  deceased  member  relates  to  the  statute  of  limita- 


38  FRATERNAL    SOCIETY    LAW 

tions,  a  formal  judicial  acknowledgment  of  the  indebtedness  of  the 
corporation  to  the  plaintiff,  made  and  signed  by  its  authorized  board 
of  arbitration  upon  the  application  of  the  beneficiary,  if  their  action 
iinder  the  rules  of  the  order,  whose  decision  being  unappealed  from, 
should  become  final  and  conclusive,  it  is  a  binding  act  of  the  cor- 
poration, and  takes  the  ease  out  from  the  operation  of  the  statute  of 
limitations. 

Dearborn  vs.  Grand  Lodge  A.  O.  U.  W..  March  20th,  1903,  138  Cal. 
658. 

New  Charter  for  Old  Society — Affect  on  Members '  Contracts. 

An  apiilicant  for  membership  in  a  fraternal  society  agreed  to  be 
bound  by  all  the  laws  of  the  society  then  in  force,  or  which  might 
be  thereafter  adopted  by  it.  Upon  this  application,  made  in  1891,  a 
certificate  was  issued.  In  1896  the  society  passed  a  by-law  providing 
for  the  forfeiture  of  certificates  of  membership  held  by  members  who 
might  enter  the  active  service  of  the  army  or  navy  in  time  of  war. 
In  1898  the  member  entered  actively  into  the  military  service  of 
the  army,  and  was  ordered  to  the  Philippines,  where  he  died  from 
wounds  received  in  battle.  Up  to  the  time  of  his  death,  he  had  made 
all  payments  required  upon  the  certificate. 

The  society  was  first  incorporated  in  1870,  and  by  an  amendment 
made  in  1875,  the  period  of  existence  of  the  corporation  was  fixed 
at  20  years,  and  it  was  while  the  society  was  doing  business  under 
the  charter  as  amended  in  1875  that  the  certificate  was  issued.  In 
189-1:  officers  and  members  of  the  Supreme  Lodge  of  the  society  ob- 
tained a  new  charter.  This  was  done  in  view  of  the  fact  that  the 
charter  existing  was  about  to  expire,  and  the  new  charter  provided 
"tliat  all  claims,  accounts,  debts,  things  in  action,  or  other  matter 
of  liusiness,  of  whatever  nature  now  existing  for  or  against  the  said 
S\ipreme  Lodge  of  Knights  of  Pythias  of  the  World  shall  survive, 
succeed  to  and  against  the  defendant  herein."  The  new  society  took 
the  business  of  the  former  on  and  after  June  29th,  1894,  received 
their  assessments  from  members  under  certificates  theretofore  issued, 
and  carried  on  business  .iust  as  tlie  old  society  had  been  doing.  The 
court  licld  that  the  member  holding  the  certificate  sued  upon  in  this 


THE    STATE    OF    CALIFORNIA  39 

ease,  had  no  knowledge  of  the  change  in  the  corjxu'ation,  and  that 
the  two  corporations  were  different  entities,  and  that  while  the  old 
organization  might  transfer  its  fnnds  to  the  new  one,  upon  the  latter 
agreeing  to  pay  its  obligations,  it  could  not  delegate  power  to  make 
laws  as  to  existing  contracts.  And  the  court,  therefore  held,  that 
the  law  passed  in  1896  did  not  affect  the  member's  contract.  The 
opinion  cites  no  authority  to  support  it  and  rests  its  opinion  upon 
disputed  facts  which  were  not  actually  in  issue.  The  court  seems 
to  have  misapprehended  the  character  of  the  organization,  and  some 
essential  facts  connected  therewith  and  the  Act  of  Congress,  ap- 
proved June  29th,  1894,  reincorporating  the  society,  and  to  have 
misunderstood  the  facts  as  to  the  date  of  the  expiration  of  the  char- 
ter, and,  consequently,  the  opinion  of  the  court  rests  upon  doubtful 
and  questionable  ground. 

Richter  vs.  Supreme  Lodge  Knights  of  Pythias.  July  7th,  1902,  137 
Cal.   8. 

Trial  and  Expulsion  by  Lodge — Setting  Verdict  Aside  by  Court. 

Where  the  constitution  of  a  fraternal  society  provided  for  the 
trial  of  an  accused  member,  before  a  trial  committee  upon  notice, 
and  for  action  upon  their  verdict  and  report  by  the  lodge,  and  for 
expulsion  or  other  penalty,  by  two-thirds  of  the  ballots  cast  in  the 
lodge,  and  a  judgment  of  exi^ulsion  appearing  upon  the  records  to 
have  been  made  by  the  ballots  of  a  majority  of  the  members  present, 
was  declared  void  by  a  court  of  competent  jurisdiction,  and  the  ex- 
pelled member  was  ordered  reinstated  to  the  extent  that  such  mem- 
bership existed  immediately  prior  to  such  attempted  expulsion.  The 
judgment  did  not  effect  the  validity  of  the  trial  and  verdict,  and  it 
was  held  that  a  subsequent  expulsion  of  the  member  by  two-thirds 
of  the  members  present,  without  any  new  verdict,  or  new  trial,  was 
valid  and  lawful. 

Dojanin  vs.  Austrian  Benevolent  Society  of  San  Jose,  August  7th, 
1902,   137  Cal.  165. 


40  FRATERXAL    SOCIETY    LAW 

Lien  on  Members'  Certificate — Statute  of  Limitations. 

Where  a  benefit  certificate,  payable  to  jtlaintiff  as  beneficiary, 
was  assigned  by  the  member  as  collateral  security  to  indemnify  his 
sureties,  who  were  compelled  to  pay  a  debt  for  him,  and  who  were 
designated  as  beneficiaries  in  the  assignment,  but  not  properly  made 
siTch  under  the  laws  of  the  society,  and  the  sureties  neglected  to 
bring  any  action  against  the  member  for  reinbursement  for  more 
than  two  years,  his  obligation  to  reimburse  not  having  been  renewed 
or  extended  by  him  in  writing,  became  barred  by  the  statute,  and 
the  lien  of  the  sureties  upon  the  certificate  thereby  extinguished 
as  against  the  lawful  beneficiary. 

Conway  vs.   Supreme  Council    Catholic   Knights  of  America  et  al., 
Sept.  22nd,  1902,  137  Cal.  384. 

Legal  Heirs — Who  Are? 

A  benefit  eei-tifieate  was  payable  on  the  member's  death  "to  his 
legal  heirs,  related  to  said  member  in  the  relationship  of  heirs,"  and 
was  held  to  constitute  a  contract  between  the  member  and  the 
society,  and  that  the  member  was  without  right  to  change  the  bene- 
ficiary by  his  will.  It  was  further  held  that  the  beneficiaries  under 
such  contract  are  entitled  to  take  by  authority  thereof,  and  not  by 
succession,  and  that  the  certificate  did  not  become  a  part  of  the 
assets  of  the  member's  estate,  and  that  for  the  purjiose  of  determin- 
ing who  the  heirs  of  the  deceased  member  are,  resort  is  to  be  had  to 
the  succession  laws  of  the  State  under  which  the  descent  is  cast. 

Burlie  vs.  M.  W.  of  A.,  Jan.  .ith.  1906.  2  Cal.  App.  Gil. 

After-enacted    Laws — Reduction    of    Benefit — Distinction    Between 
Rights  Under  Certificate  and  By-laws. 

A  certificate  issued  by  a  fraternal  society  provided  for  the  pay- 
ment of  ,$2,000.00  upon  coiidition  that  the  iiKuuber  should  comply 
with  the  laws,  rules,  and  rcg\iliiti(nis  then  govcfuing  the  society, 
"or  that  tliereafter  might,  be  ciuicted  for  its  government."  was  held 
to  constitute  a  contract  of  iiisiirancf.  and  that  it  conld  not  be  altered 


THE    STATE    OF    CALIFORNIA  41 

without,  the  assent  of  Ixitli  pai'tles  to  the  contract,  and  that  a  by-law 
subsequently  passed,  reducing  the  amount  payable  on  outstanding 
benefit  certificates  for  $2,000.00  to  the  amount  of  $1,000.00,  each 
was  held  to  be  not  a  rule  or  regulation  for  the  government  of  the 
society,  but  that  such  an  enactment  was  an  attempted  repudiation 
by  the  society  of  its  contracts.  The  court  said  that  if  the  society 
could  pass  such  a  by-law,  limiting  its  liability  to  one-half  of  its 
obligation,  it  could  by  a  similar  enactment  relieve  itself  of  all  obli- 
gation. The  court  di-stinguished  this  case  from  that  of  Stohr  vs. 
San  Francisco  M.  Fnd.  Society,  82  Cal.  557,  22  Pac.  1125,  by  saying 
that  in  that  case  the  right  of  the  plaintiff  to  receive  sick  benefits 
was  not  based  u]ion  a  special  contract,  but  rested  upon  a  by-law, 
which  the  plaintiff  by  joining  the  society  agreed  might  be  changed 
at  the  pleasure  of  the  society.  The  court  supports  its  conclusions 
by  discussing  numerous  authorities. 

The  court  rested  its  decision  upon  the  doctrine  announced  in  the 
cases  of  Morton  vs.  Supreme  Coiuicil  Royal  League,  100  Mo.  App.  76; 
73  S.  W.  259;  Campbell  vs.  American  Benefit  Club,  100  Mo.  App. 
249 ;  73  S.  W.  342.  In  which  two  cases  it  was  held  that  an  agree- 
ment to  be  bound  by  after-enacted  by-laws  was  not  such  an  agree- 
ment as  to  warrant  the  reduction  or  changing  of  the  consideration 
for  which  assessments  were  made  upon  the  members. 

Bornstein  vs.  Dist.  Grand  Lodge  Indp.  Order  of  B'Nai  B'Rith,  Jan. 
9,  1906,  2  Cal.  App.   624. 

Divorce  of  Beneficiary — Effect  of. 

Where  a  member  had  designated  his  wife  as  his  beneficiary 
in  accordance  with  the  laws  of  the  society,  and  she  subse- 
quently obtained  a  divorce  from  him.  after  which  he  mari'ied  and 
had  children  by  his  second  wife,  but  died  without  having  changed 
the  beneficiary  certificate,  the  divorced  wife  is  entitled  as  the  bene- 
ficiary named  in  the  certificate,  to  recover  the  amount  thereof  to  the 
exclusion  of  the  second  wife  and  his  children  b^'  her.  The  by-law  of 
the  society  providing  for  the  appointment  of  beneficiaries,  gave  the 
member  power  to  name  "such  person  or  persons  as  said  member 
might  have  directed  while  living."    It  was  further  provided  that  the 


42  FRATERKAL    SOCIETY    LAW 

benefieiarj-  "shall  in  every  instance  be  one  or  more  members  of  his 
family,  or  some  one  related  to  him.  or  dependent  upon  him."  And 
the  court  lield  that  the  latter  provision  is  to  be  construed  as  referring 
to  the  relationship  existing  at  the  date  of  the  certificate,  and  that 
the  designation  of  a  beneficiar.y,  valid  in  its  inception,  remained  so, 
notwithstanding  the  relationship  of  the  member  to  the  beneficiary 
has  ceased. 

Courtois  vs.  Grand  Lodge  A.  O.  U.  W.  et  al.,  Feb.  21,  1902,  135  Cal. 
552;  Citing  with  approval.  Overhiser  vs.  Overhiser,  14  Colo.  App.  1. 

Right  of  Interpleader. 

A  corporation  existing  as  a  Fraternal  Beneficiary  Society  may 
maintain  an  action  of  interpleader  between  conflicting  claimants  to 
a  fund  in  its  hands,  and  which  it  brings  into  court  at  the  time  of 
filing  the  suit. 

Woodmen  of  the  World  vs.  Rutledge,  August  12,  1901,  133  Cal.  640. 

Beneficiary — Fiancee's  Rights  of. 

Where  a  married  man,  living  apart  from  his  wife,  surrendered  a 
benefit  certificate  taken  in  a  fraternal  society,  which  was  pay- 
able to  his  child,  and  obtained  a  new  certificate  in  favor  of  an  un- 
married woman  as  his  beneficiarj-,  who  was  designated  as  his 
fiancee,  the  court  held  that  the  new  certificate  was  issued  in  accord- 
aticr  with  the  constitution  of  the  plaintiff',  and  was  in  full  efi'ect  at 
the  time  of  the  member's  death:  that  the  description  of  the  bene- 
ficiary as  the  member's  "fiancee,"  might  be  disregarded  as  mere 
descriptio  personae,  and  the  fact  that  she  could  not  become  engaged 
to  marry  tlie  member  was  held  not  to  preclude  a  judgment  in  her 
favor,  and  that  she  need  not  show  that  she  had  an  insurable  interest 
in  the  life  of  the  member  in  order  to  recover.  It  is  to  be  remembered 
that  there  is  no  statute  law  of  the  State  prescribing  the  class  of  bene- 
ficiaries and  no  by-law  of  the  society  upon  the  subject  seems  to  have 
been  shown  or  regarded. 

Woodmen  of  the  World  vs.  Rutledge,  August  12,  1901,  133  Cal.  G40. 


THI-:    STATE    OF    CALIFORNIA  43 

Forfeiture  for  Non-payment  of  Assessment. 

Wbcro  a  iiiciuln'r  at;rc'es  to  conii)ly  witli  the  laws  of  the  society  as 
a  condition  upon  which  ho  is  to  i)articipate  in  its  beneficiary  fund, 
his  failure  to  pay  his  subordinate  lodge  dues,  was  held  to  have 
ipso  facto  suspended  him  under  the  by-law,  and  that  his  beneficiary 
was  not  entitled  to  recover  the  amount  of  the  benefit. 

Marshall  vs.  Grand  Lodge  A.  O.  U.  W..  August  14.  1901.  133  Cal.  686. 

Denial  of  Subordinate  Officer 's  Agency — Estoppel. 

The  officers  of  a  subordinate  lodge  were  declared  in  the  .society's 
laws  not  to  be  agents  of  the  grand  lodge,  and  in  such  case,  the  court 
upheld  the  provision,  and  denied  the  agency  claimed  on  the  part  of 
local  lodge  officers,  and  also  denied  that  the  local  lodge  had  the 
power  to  waive  any  laws  of  the  grand  lodge,  and  imputed  knowledge 
to  the  member  of  the  fact,  that  the  officers  of  the  subordinate  lodge 
could  not  waive  the  grand  lodge  laws.  It  was  therefore  held,  that 
the  grand  lodge  was  not  estopjied  because  of  the  fact  that  the 
money  paid  by  the  member  to  secure  his  reinstatement  in  the  sub- 
ordinate lodge  had  been  retained  by  the  lodge. 

Marshall  vs.  Grand  Lodge  A.  0.  U.  W.,  August  14,  1901,  133  Cal.  686. 

Fraternal  Societies  Exempt  from  Insurance  Laws. 

The  i)rovisions  in  the  laws  of  a  fraternal  society  providing  that  a 
certificate  issued  entitles  a  beneficiary  named  therein  to  a  stipulated 
sum,  upon  the  death  of  the  member,  does  not  sub.iect  the  societj'  to 
the  operation  of  the  general  insurance  laws  of  the  State,  said  frater- 
nal societies  being  expressly  exempt  from  such   general  laws. 

Marshall  vs.  Grand  Lodge  A.  O.  U.  W.,  August  14th,  1901,  133  Cal. 
686. 

Sick  Benefits — After-enacted  Laws — Effect  of. 

Where  a  sick  member  of  a  subordinate  lodge  of  the  Knights  of 
Pythias  had  been  paid  sick  benefits  at  the  regular  rate  of  $10.00  per 


44  FRATERNAL    SOCIETY    LAW 

week  for  100  weeks  under  a  former  by-law.  a  change  in  the  b.y-laws 
not  made  retroactive  in  terms,  introducing  a  graduated  scale  of 
$10.00  per  week  for  50  weeks,  $5.00  per  week  for  the  next  50  weeks, 
and  $3.00  per  week  thereafter,  or  during  the  continuation  of  the 
member's  disability,  it  was  held  that  the  operation  of  the  changed 
by-law  upon  such  sick  member  was  the  same  as  upon  any  other 
member,  and  as  if  he  had  been  taken  sick  upon  the  day  of  its 
adoption ;  but  that  no  part  of  the  benefits  received  by  him  prior  to 
the  change  could  be  considered  as  applicable  upon  the  graduated 
scale: 

Berlin  vs.  Eureka  Lodge  No.  9,  Knights  of  Pythias,  March  21st,  1901, 
132   Cal.   .294. 

Exhaustion  of  Lodge  Remedies. 

An  aggrieved  inember  of  a  subordinate  lodge  of  a  fraternal  societ.v 
must  exhaust  all  the  remedies  provided  in  llie  by-laws  for  the  re- 
dress of  grievances  before  he  can  apply  to  a  court  for  relief. 

Berlin  vs.  Eureka  Lodge  No.  9,  Knights  of  Pythias.  March  21st,  1901, 
132   Cal.   294. 

Changing  Beneficiary— Compliance  With  Laws  Required. 

The  by-laws  of  a  fraternal  society  iiroviding  a  specified  mode  for 
the  changing  of  beiieticiary,  forms  a  part  of  the  contract,  and  the 
society  may  require  compliance  witli  its  laws,  or  may  refuse  to  pay 
to  tlie  changed  beneficiary.  In  the  case  at  bar,  a  benefit  certificate 
was  assi.gned  by  the  member  holding  it,  to  a  beneficiary  named 
therein,  to  secure  sureties  of  the  member  who  were  compelled  to 
pay  his  debt ;  but  there  was  no  compliance  with  the  by-laws  of 
the  societ.v  witli  reference  to  changing  the  beiH>ficiary,  and  it  was 
held  that  the  sureties  could  not  enforce  their  ileiiiaiid  direelly  against 
the  society. 

Conway    vs.    Supreme    Council    Catholic    Knights   «(   America.    Jan. 
25th.   19(11,    131    Cal.   437.     See  later  case,  137  Cal.   3S4. 


THE    ttTATE    OF    CALIFORNIA  45 

Expulsion  of  Members  and  Lodges. 

An  niiiucorporatcil  society,  ors'anizecl  toi'  irintiial  licnclit,  is  merely 
an  aggregate  dT  iiidividiials.  calleil  for  coiiveiiicnce  liki'  ])artiier- 
sliips,  b.y  a  conuuoii  name,  its  luembers  own  its  ])i-o])erty,  and 
which  has  no  right  of  expulsion,  except  that  passed  x\]w\\  and  agreed 
to  by  the  members,  embodied  in  its  constitution  and  by-laws.  No 
member  can  be  deprived  of  his  share  in  tlie  property  by  expulsion, 
without  a  specific  charge  of  a  violation  of  the  particular  rules  or 
laws,  creating  the  offense  charged,  and  iirescriliing  an  expulsion 
as  the  penalty,  and  without  notice  and  a  hearing  of  such  charge. 
The  same  principles  which  are  applicable  to  the  expulsion  of  a  mem- 
ber, are  applicable  to  the  expulsion  of  a  subordinate  lodge  and  its 
members  and  the  forfeiture  of  its  charter  by  the  Grand  or  Supreme 
Lodge.  If  there  is  no  provision  in  the  charter,  constitution  or  l>y- 
laws  of  the  society,  prescribing  vicarious  service  of  the  charge  and 
hearing  thereof,  upon  its  officers,  designated  to  have  such  jurisdic- 
tion to  revoke  the  subordinate  lodge  charter,  it  can  only  be  acquired 
by  personal  service  upon  the  nK'inbcrs  ol'  the  subordinate  lodge. 

Grand  Grove  of  the  United  Order  of  Druids  vs.  Garibaldi  Grove  No. 
71  et  al.,  Sept.  27.  ]900,  130  Cal.  116. 

Rights  of  Beneficiary — A  Mere  Expectancy. 

The  beneficiary  naiin'd  in  a  certificate  issued  to  a  member  of  a 
fraternal  society  has  no  interest  or  property  therein  to  which  the 
heirs  of  the  beneficiary  can  succeed,  but  has  only  a  "mere  expectancy 
to  an  uncompleted  gift."  which  is  revocable  at  the  will  of  the  in- 
sured, and  cannot  ripen  into  a  right  until  his  death.  Upon  the 
death  of  the  beneficiary  ))!'ini-  to  that  of  the  member,  thSs  exjiectancy 
dies  with  the  lienefieiary ;  and  if  no  other  beneficiary  is  selected  by 
the  member,  his  heirs  will  become  the  beneficiaries,  if  the  by-laws 
so  provide,  to  the  exclusion  I'f  the  heirs  of  tiu'  deceased  beneficiary. 

Supreme  Council  American  Legion  of  Honor  vs.  Gehrenbeck  et  al., 
March  ISth.   1899,  124  Cal.  43. 


46  FRATERNAL    SOCIETY    LAW 

Insolvency — Reserve  Fund  Use. 

Upon  the  insolvency  of  a  mutual  benefit  society  occurring,  which 
society  was  organized  upon  the  assessment  plan,  the  reserve  fund  of 
$5,000.00  required  by  the  statutes  to  be  held  and  deposited  in  trust 
for  the  certificate  holders  of  the  corporation,  and  designed  as  an 
emergency  fund  to  be  used  only  in  ease  of  insolvency  of  the  society, 
cannot  be  used  to  pay  the  benefits  due  while  solvent.  It  must  be 
distributed  pro  rata  among  the  beneficiaries  for  whose  benefit  the 
certificates  were  issued,  and  neither  the  members  of  the  society,  nor 
its  general  creditors  can  .share  in  its  distribution. 

San  Francisco  Savings  Fund  vs.  Long,  Dec.  20th,  1898,  123  Cal.  107. 

While  the  foregoing  case  was  not  a  fraternal  beneficiary  society 
case,  nevertheless  it  is  believed  probable  that  the  doctrine  announced 
in  this  ease  may  have  some  application  to  somewhat  similar  funds 
required  to  be  maintained  and  kept  i)y  some  of  the  fraternal  so- 
cieties. 

Members     Property     Rights — Incidental — Forfeiture — Review     by 
Courts  of  Lodge  Trials. 

The  interest  which  a  member  has  in  the  property  of  a  fraternal 
society  is  only  incidental  to  his  membership,  and  will  cease  upon  his 
ceasing  to  be  a  member.  If  he  has  forfeited  his  right  of  member- 
ship by  reason  of  his  coudiict.  tliis  interest  in  the  property  will 
not  prevent  his  expulsion,  or  give  to  the  courts  the  right  to  prevent 
an  investigation  of  the  charge,  or  to  determine  its  sufficiency.  In 
the  case  at  bar,  the  constitution  of  the  society  provided  that  one  of 
the  objects  was  the  propagation  of  unity,  of  friendshiii  and  brotlierly 
love  among  its  members,  and  gave  to  the  society  the  right  to  expel 
a  member  wlio  violated  any  of  the  principles  of  tiie  society,  or 
offended  against  the  constitution.  It  was  held  Unit  whellu'r  appro- 
brious  language  u.sed  by  a  nicinlier  lowards  his  fellows  in  Ihe  society 
is  a  violation  of  the  eonstilul  inn  or  i)rineiples,  is  for  the  society  to 
determine,  and  tliat  its  action  in  (•x|iellii}g  a  niendier.  after  due  notice 
and   a    I'air  (rial,  will   not   lie  interl'ereil   with   li\'   the  courls. 


THE    STATE    OF    CALIFORNIA  47 

Josich.  vs.  Austrian  Benevolent  Society  of  San  Jose,  Nov.  18th,  1897, 
119   Cal.   74. 

What  Composes  the  Contract? 

All  of  the  by-laws,  rules,  and  regiilations  of  a  iiiiiliial  heiictit  asso- 
ciation become  a  part  of  its  contract  with  its  members,  whether 
referred  to  in  the  contract  or  not,  and  all  of  them  must  be  read 
together. 

Hass  vs.  Mutual  Relief  Ass'n.  Sept.  3rc],  1897,  118  Cal.  6. 

Lodge  Trials — Court  Review. 

The  courts  will  not  interfere  with  the  disciplinary  power  of  fra- 
ternal societies  exercised  in  accordance  with  their  laws,  unless  there 
is  involved  the  determination  of  some  civil  or  property  right,  and 
then  their  jurisdiction  is  limited  to  inquiring  whether  the  rules  pre- 
scribed by  the  society  for  the  determination  of  the  right  have  been 
violated.  Where  a  disciplined  member  has  received  notice  of  a  hear- 
ing upon  a  charge  of  having  violated  a  rule  of  the  society,  and  is 
being  tried  in  accordance  with  its  rules,  and  has  the  right  of  appeal 
within  the  society  from  any  adverse  decision  at  the  hearing,  so  long 
as  he  has  this  right  of  redress  witliin  the  society,  he  has  no  right 
to  invoke  the  aid  of  the  courts. 

Lawson  vs.  Hewell.  Oct.  15th,  1897,  118  Cal.  613. 

The  Society's  Policy  Will  Not  be  Interfered  With  by  Courts. 

The  duly  chosen  and  authorized  representatives  of  the  members 
of  a  society  are  vested  with  power  and  discretion  to  determine  what 
is  for  the  best  interests  of  the  society,  and  what  shall  be  its  internal 
economy,  or  whether  a  change  therein  is  demanded,  and  the  courts 
have  no  standard  by  which  to  determine  the  propriety  of  its  rules, 
and  they  cannot  interfere  with  questions  of  policy,  doctrine,,  or 
discipline,  nor  with  the  discretion  of  the  governing  body,  unless 
there  is  an  arbitrary  invasion  of  private  rights. 

Lawson  vs.  Hewell,  Oct.  lath.  1897,  118  Cal.  f>13. 


4y  FRATERNAL    SOCIETY    LAW 

After-enacted  Laws. 

The  eontractural  relation  between  the  members  and  the  society  is 
to  be  determined  by  a  consideration  of  the  entire  body  of  laws  gov- 
erning the  society,  and  is  not  limited  to  those  existing  at  the  time 
when  the  member  becomes  such ;  unless  rules  have  placed  a  limita- 
tion upon  the  power  of  the  society  to  make  any  change  or  amend- 
ment therein — any  amendment  or  change  adopted  in  accordance  with 
the  mode  provided  by  the  society  therefor  is  binding  upon  all  the 
members. 

Lawson  vs.  Hewell.  Oct.  15th,  1897,  US  Cal.  613. 

After-enacted  Laws. — Ultra  Vires  Contracts. 

At  the  time  of  the  is.suance  of  a  certificate  a  by-law  of  the  society 
provided  th^t  in  addition  to  the  payment  of  death  benefits,  disability 
benefits  would  be  allowed  as  follows:  "A  total  and  permanent  dis- 
ability to  perform  or  direct  any  kind  of  labor  or  business,  or  upon 
reaching  the  age  of  70  years,  shall  entitle  a  member  holding  a  cer- 
tificate of  endowment,  so  disabled  or  aged,  to  the  payment  of  one- 
half  of  the  endowment  to  which  he  would  be  entitled  at  death,  pro- 
vided, however,  that  in  case  of  a  total  and  permanent  disability, 
satisfactory  proofs,"  etc.,  must  be  furnished.  "From  the  date  of 
such  payment  such  member  shall  only  pay  pro  rata  or  one-half  as 
much  at  each  assessment  as  prior  thereto.  On  the  death  of  such 
member  his  heirs  or  assigns  shall  receive  his  endowment,  less  the 
amount  which  may  have  been  paid,  as  provided  above."  The  So- 
ciety was  a  Michigan  corjioration,  incorporated  under  an  act  au- 
thorizing it  among  other  things  to  "secure  a  certain  sum  of  money 
weekl.y  or  monthly  to  any  member  disabled  by  sickness  or  through 
disability,"  At  the  time  when  the  INIiehigan  act  and  by-laws  of  the 
Society  quoted  above  were  in  force,  the  member  in  question  had 
received  a  $2,000  certificate  payable  to  his  daughter.  He  made  all 
payments  required  under  it  and  coiH])lie(l  with  the  rules  and  regu- 
lations of  the  Soeiet.y,  and  in  the  year  1905,  upon  arriving  at  the 
age  of  70  years,  the  member  claimed  payment  of  the  certificate,  and 
upon  the  Society's  refu.sal  to  pay  him,  he  brought  suit.    Snb.sequent 


THE    STATE    OF    GALIFOKXIA  49 

to  the  issuiiueo  of  tlic  i.-crlificali.'  a  by-law  was  passi'd  providnig  that 
instead  of  j)aying  as  theretofore  upon  iirnnaiicnt  disability,  the 
aniouiit  to  be  paid  sliould  be  only  10%  of  the  amount  of  the  certifi- 
cate annually,  such  payment  to  he  made  dnrint;-  the  existence  of  per- 
manent disability.  The  Society  conteiitled  that  the  contract  sued 
upon  was  ultra  vires  and  void,  in  that  the  promise  to  make  payments 
upon  the  member  attaining  the  age  of  70  years,  was  not  authorized  by 
the  act  under  which  the  Society  was  ineorixuatrd.  But  the  Court 
held  to  a  contrary  view,  holdiuL;  the  i-ontraet  valid  and  as  to  the 
amended  by-laws,  held  that  it  was  imt  n'ti-actixc  in  terms  and  only 
applied  to  contracts  subsequently  made. 

Guthrie  vs.  Supreme  Tent  of  the  Maccabees  of  the  World,  .July,  1906, 

Court  of  Appeals  of  Cal. 
Re-hearing  denied  in  Supreme  Court  Sept.  IftOO.  87  Pac.  405. 


50  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  COLORADO. 


CHAPTER  6. 

The  following  sections  of 
"An  Act  relating  to  an  Insurance  Department  in  and  for  the  State 
of  Colorado,  and  to  regulate  the  insurance  companies  and  fraternal 
and  benevolent  orders  and  societies  and  others  doing  business 
therein,  providing  penalties  for  violations  thereof,  and  repealing 
all  Acts  and  parts  of  Acts  in  conflict  therewith."  (Approved 
April  1,  1907.    In  effect  July  1,  1907.) ; 

Kelatc  to  Fraternal  Benefit  Societies: 
Definitions. 

Section  1.  That  in  this  act,,  unless  the  context  otherwise  requires  : 
"Company"  or  "Insurance  Compauj^"  shall  include  all  corporations, 
associations,  partnerships  or  individuals  engaged  as  principals  iu 
the  insurance  business,  excepting  Fraternal  and  Benevolent  orders 
aiul  societies.  "Domestic"  designates  such  companies  when  in- 
eorjiorafed  \iiid(^r  the  laws  of  the  State  of  Colorado.  "Foreign." 
when  used  without  limitations,  designates  such  companies  when 
organized  or  incorporated  under  authority  other  than  that  of  the 
State  of  Colorado. 

The  word  "Commissioner"  and  the  words  "Deputy  Commis- 
sioner" as  used  in  this  act,  shall  designate  th(>  Commissioner  of 
Insurance  and  tlie  Deputy  Commissioner  of  Insurance,  respectively. 
^Vlierever  in  the  laws  of  Colorado  which  are  not  repealed  by  this 
act  other  titles  are  used  to  designate  tlie  ehief  (iffteer  and  the  second 
officer  of  the  Insurance  Department,  sut-ii  titles  sliall  be  understood 


THE    STATE    OF    COLORAUO  51 

as  meaning  the  Commissioner  ol'  Insurance  and  the  Deputy  Commis- 
sioner of  Insurance,  as  hereinal'ter  delineil  by  this  act. 

Prohibiting  the  Diversion  of  Funds  for  Political  Purposes. 

Section  47.  No  insurance  company  or  association,  incluiiing  fra- 
ternal beneficiary  associations  doing  business  in  this  State,  shall, 
directly  or  indirectly,  i)ay  or  use  or  offer,  cou.sent  or  agree  to  pay 
or  use  any  money  or  property  for  or  in  aid  of  any  political  party, 
committee  or  organization,  or  for  or  in  aid  of  any  corporation,  joint 
stock  or  other  association  organized  or'maintained  for  political  i)ur- 
poses,  or  for  or  in  aid  of  any  candidate  for  political  office,  or  for 
nomination  for  such  office,  or  for  any  political  purpose  whatsoever, 
or  for  the  reimbursement  or  indemnification  of  any  j^erson  for  money 
or  property  so  used.  Any  officer,  director,  stockholder,  attorney  or 
agent  of  any  corporation  or  association  which  violates  any  of  the 
provisions  of  this  act,  who  participates  in,  aids,  abets  or  advises  or 
consents  to  any  such  violation,  and  any  person  who  solicits  or  know- 
ingly receives  any  money  or  propei'ty  in  violation  of  this  act,  shall 
be  guilty  of  a  misdemeanor  and  be  punished  by  imprisonment  for 
not  more  than  one  year  and  a  fine  of  not  more  than  one  thousand 
dollars,  and  any  officer  aiding  or  abetting  in  any  contribution  made 
in  violation  of  this  act,  shall  be  liable  to  the  company  or  association 
for  the  amount  so  contributed. 

No  person  shall  be  excused  from  attending  and  testifying,  or  pro- 
ducing any  books,  papers  or  other  documents  before  any  court  or 
magistrate,  upon  any  investigation,  proceeding  or  trial,  for  a  viola- 
tion of  any, of  the  provisions  of  this  act,  upon  the  ground  or  for  the 
i-eason  that  the  testimony  or  evidence,  documentary  or  otherwise, 
required  of  him  may  tend  to  incriminate  or  degrade  him :  but  no 
person  shall  be  prosecuted  or  subjected  to  any  penalty  or  forfeiture 
for  or  on  account  of  any  transaction,  matter  or  thing  concerning 
which  he  may  so  testify  or  produce  evidence,  documentary  or  other- 
wise, and  no  testimony  so  given  or  produced  shall  be  used  against 
him  n|)(in  any  criminal  investigation  or  proceeding. 

Fraternal  and  Benevolent  Organizations. 

Section  73.      (1)     The    provisions   of   this   act    shall   not   be   con- 


52  FRATERNAL    SOCIETY   LAW 

strued  so  as  to  prevent  any  fraternal,  religious  or  benevolent  so- 
cieties which  conduct  their  business  as  fraternal  societies,  under  the 
lodge  system,  or  to  other  organizations  which  do  not  employ  paid 
agents  in  soliciting  business,  or  to  those  which  limit  their  certificate- 
holders  to  a  particular  order  or  fraternity,  from  issuing  indemnity 
to  any  person,  against  loss  by  death,  sickness  or  accident,  of  any 
of  its  members ;  and  such  society  shall  not  be  held  amenable  under, 
or  governed  by.  any  of  the  jirovisions  of  any  section  of  this  act  per- 
taining to  accident,  health  or  life  insurance,  except  as  to  rendering 
to  the  Commissioner  of  Insurance  an  annual  statement  of  the  con- 
dition of  said  organizations  or  societies,  and  paying  the  Insurance 
Department  a  fee  of  five  dollars  ($5). 

(2)  Any  association  having  a  supreme  governing  or  legislative 
bod.y,  and  subordinate  lodges  or  branches  by  whatever  name  known, 
into  which  members  shall  be  elected  and  initiated  or  admitted  in 
accordance  with  its  constitution,  laws,  rules,  regulations  nnd  pre- 
scribed ritualistic  ceremonies,  which  subordinate  lodges  or  branches 
shall  be  required  to  hold  regular  or  stated  meetings  at  least  once 
in  each  month.  aii<l  preserve  a  roll  of  the  officers  present,  shall  be 
deemed  to  be  oixM-ating  under  the  lodge  system. 

(3)  Any  benevolent  or  fraternal  society  or  order,  doing  business 
in  this  State,  under  the  lodge  .sj'stem,  and  incorporated  inader  the 
laws  ol'  anotlier  State,  which  i.ssues  certificates  of  indemnity  against 
loss  by  death,  accident  or  sickness  of  any  of  its  members,  shall  file 
a  copy  of  its  charter  or  articles  of  incorporation  as  required  by  Sec- 
tion lT).  Chapter  19.  General  Statutes.  (See.  500  :\Iills  Anno.  Stats, 
hereof.) 

(4)  Every  sueli  foreign  lienevolent  ov  fraternal  societ.y  or  order 
shall  file  with  the  Secretai-y  of  State  a  cei-tificate  signed  by  its  pi'esi- 
(Icnt  or  head  officer,  and  its  secretary,  duly  acknowledged,  desig- 
nating an  agent  or  agents  and  Ihcir  place  of  rrsidi'ni'c  in  this  State. 
ni)on  whom  process  may  be  served. 

(5)  Suits  against  such  corjiorat  ions  may  be  instituted  at  the 
election  of  the  plaintitf  in  tlu'  County  in  which  lie  resides,  oi'  in  the 
County   in  wliich  the  agent  resides. 

(fi)  .\ny  lodge  of  any  such  benevdient  m-  IVaternal  society  or 
ordei'.  wliich  has  cuniplied  with  the  provisinns  nl'  tlii.s  act.  may  bring 


THE    STATE    OF    VOLUItADU  53 

ail  .ic'tioii  on  ;iii.y  Ixuul  niiiniiig  to  it  or  ;iii\-  of  its  orticcrs,  the  same 
as  thouyli  such  loili^c  hail  iiccii  iiicoriioraliMl  iiiiih'r  the  hiws  of  this 
State. 

(7)  The  fees  of  the  Secretary  of  State  shall  he  the  same  as  for 
cor])orations  not  organized  for  pecuniary  profit. 

(8)  It  shall  be  the  duty  of  the  presiding  officer  of  any  lodge  in 
this  State,  under  any  such  foreign  benevolent  or  fraternal  society  or 
order,  to  see  that  the  requirements  of  this  act  are  complied  with, 
and  ninety  days  from  its  passage  shall  be  allowed  for  a  compliance 
with  its  provisions. 

(9)  Every  contract  whereby  a  casli  or  other  benefit  is  to  accrue 
to  a  person,  or  to  persons,  named  or  designated  therein,  upon  the 
deatli  of  a  pers(ui  from  cause  not  accidental,  shall  be  deemed  a  con- 
tract of  life  insurance;  and  it  shall  be  unlawful  for  any  person, 
copartnership,  association,  organization,  society,  order  or  fraternity, 
except  life  insurance  companies  or  bona  fide  fraternal,  religious  or 
benevolent  societies,  as  defined  b.v  tliis  act,  to  make  or  issue  such 
contracts  of  insurance ;  and  it  shall  likewise  be  unlawful  for  any  fra- 
ternal, religious  or  benevolent  society,  order,  association  or  organiza- 
tion which  provides  a  death  benefit,  to  make  it  a  condition  or  pro- 
vision of  any  contract  or  membership  certificate  issued  to  it,  that 
the  beneficiary  is  required  to  patronize  any  particular  undertaking 
or  burial  firm,  corporation  or  establishment.  xVny  violation  of  am' 
of  tlie  jirovisions  of  this  Section,  by  any  person  or  anj^  agent,  officer 
or  representative  of  any  copartnership,  organization,  association, 
society  or  order,  shall  be  a  misdemeanor,  and  for  each  and  every 
offense  shall  be  punished  by  a  fine  not  to  exceed  fifty  dollars  ($50), 
or  imprisonment  in  the  County  .jail  for  not  to  exceed  three  months, 
or  by  both  such  fine  and  imprisonment. 

Repealing-  Section. 

Section  74.  *  *  *  *  * 

(6)     An  act  entitled,  "An  act  concerning  Foreign,  Benevolent 

and  Fraternal  Societies,"  approved  April  3,  1893;  *  * 

Foreign  Corporations  Must  File  Charter. 

Section  500.    "Every  company  incoi-porated  under  the  laws  of  any 


54  FKATERXAL    SOCIETY    LAW 

foreign  State  or  Kingdom,  or  of  any  State  or  'J'erritory  of  the  United 
States  beyond  the  limits  of  this  State,  and  now  or  hereafter  doing 
business  within  this  State,  shall  file  in  the  office  of  the  Secretary  of 
State  a  copy  of  their  charter  of  incorporation,  or,  in  ease  such  com- 
pany is  incorporated  by  certificate  under  any  general  incorporation 
law,  a  copy  of  such  certificate  and  of  such  general  incorporation  law, 
duly  certified  and  authenticated  by  the  proper  authority  of  such 
foreign  State,  Kingdom  or  Territoi'y. " 

Section  500,  1  Mills'  Annotated  Statutes  of  1891,  Page  638,  and  is 
same  as  Sec.  25,  Chap.  19,  Gen'l  Stats.,  referred  to  in  Par.  3,  Sec. 
73  hereof. 

Place  of  Meeting  of  Supreme  Lodge. 

For  the  facts  in  a  case  which  justified  a  holding  of  supreme  lodge 
sessions  out  of  the  State  in  which  it  was  incorporated  and  in  any 
State  in  which  the  societ.y  was  doing  business,  and  had  subordinate 
lodges,  see 

Woodmen  of  the  World  vs.  Woods,  April  19th,  1905,  34  Colo.  1. 

After-enacted  Laws. 

A  certificate  of  membership  was  to  be  forfeited  if  the  member 
failed  to  comply  with  the  laws  of  the  society  then  in  existence,  and 
such  as  might  thereafter  be  adoj^ted.  It  was  held  that  amendments 
providing  for  additional  assessments  levied  to  establish  an  equaliza- 
tion fund,  and  providing  for  payment  of  assessments  monthly  in 
advance,  were  valid  and   binding  upon  the  members. 

Woodmen  of  the  World  vs.  Woods,  A))ril  19th,  1905,  34  Colo.  1. 

Hazardous  Vocations — Forfeiture. 

Where  the  by-laws  of  a  society  provided  that  if  the  members 
.should  engage  in  any  of  certain  named  hazardous  occupations,  they 
should  pay  in  addition  to  llu'ir  rcmilni'  assessments  a  hazardous  rate 
while  so  engaged  in  such  ha/.ardous  oceui)ations,  and  in  default  of 
such  extra  i)ayments,  should  forfeit  their  certificates  in  case  of  death 


THE    STATE    OF    VULUh'ADO  55 

resulting-  while  engaged  in  sncli  hazardous  vocations,  it  was  held, 
that  notwithstanding  the  fact  that  the  regular  payments  had  been 
made  on  the  certificate  while  the  member  was  so  engaged  in  the 
hazardous  employment,  but  that  as  no  extra  or  additional  payments 
as  required  had  been  made,  by  reason  of  such  employment,  that  the 
cei'tificate  was  forfeited,  and  the  beneficiary  without  right  of 
recovery. 

Woodmen  of  the  World  vs.  Woods,  April  19th,  1905,  34  Colo.  1. 

After-enacted  Laws — Forfeiture— Estoppel. 

Where  a  society,  after  issuing  a  certificate,  amended  its  laws,  pro- 
viding for  an  equalization  fund  and  requiring  members  to  pay 
monthly  assessments  in  advance,  instead  of  upon  the  post  mortem 
plan  as  theretofore,  and  where  a  member  acquiesced  in  the  amend- 
ment by  contributing  to  the  equalization  fund,  and  making  the  pay- 
ments monthly  in  advance,  it  was  held  that  after  the  death  of  the 
member,  a  beneficiary  cannot  claim  that  the  additional  assessments 
were  illegally  exacted,  or  improperly  applied,  or  that  she  is  en- 
titled to  have  them  applied  in  payment  of  extra  hazardous  assess- 
ments which  were  in  default  at  the  time  of  the  death  of  the  member. 
It  was  also  held  that  the  retention  of  the  assessments  paid  for  the 
month  succeeding  the  death  of  the  member,  did  not  estop  the  society 
from  disputing  its  lialiility  for  failure  to  pay  the  extra  hazardous 
assessments. 

Woodmen  of  the  World  vs.  Woods,  April  19th,  1905,  34  Colo.  1. 

Change  of  Beneficiary — Vested  Interest. 

In  the  absence  of  provisions  in  the  certificate  or  laws  of  a  society, 
permitting  changes  of  beneficiaries  by  the  members,  without  the 
consent  of  the  beneficiaries,  it  was  held  that  the  beneficiary  named 
in  the  certificate  acquired  a  vested  interest  to  the  extent  that  a  new- 
designation  of  a  beneficiary  could  not  be  made  without  her  consent. 

Hill  vs.  Groesbeck  et  al..  Sept.  1900,  29  Colo.  IGl. 


56  FRATERNAL    SOCIETY    LAW 

Change  of  Beneficiary. 

A  bj-law  authorizins'  a  nuMiilxn'  to  change  the  beneficiary  desig- 
nated in  his  certificate,  without  the  beneficiary's  consent,  was  held 
not  sufficient  to  prove  the  authority  to  make  such  change,  where  it 
did  not  appear  that  such  by-law  was  in  force  at  the  time  the  change 
was  attempted  to  be  made. 

Hill  vs.  Groesbeck  et  al..  Sept.  1900,  29  Colo.  161. 

The  last  two  references  were  to  a  contract  made  by  the  Covenant 
Mutual  Life  Association  of  Illinois,  which  was  probably  not  a  fra- 
ternal society,  but  was  only  a  mutual  assessment  society. 

Marriage — Presumption  of  Legality — Burden  of  Proof. 

"Where  a  certificate  designates  a  beneficiary  as  wife  of  the  member, 
the  presumption  will  be  indulged  in  that  she  is  his  legal  wife,  and  if 
this  fact  is  disputed,  the  burden  of  proof  rests  w-ith  the  one  dis- 
puting it  to  establish  by  a  preponderance  of  evidence  that  she  is  not 
his  legal  wife.  See  also  discussion  as  to  the  presumption  of  the 
legality  of  the  marriage  ceremony  not  being  overcome  by  proof  of 
former  marriage  of  the  parties  remaining  undissolved  by  divorce. 

Pittinger  vs.  Pittinger,  January,  1901,  2S  Colo.  308. 

Change  of  Beneficiary — Vested  Interest. 

Where  certificates  were  issued  in  favor  of  the  wife  of  a  member, 
and  were  delivered  to  her,  and  neither  they  nor  the  laws  of  the 
society  contained  any  provision  permitting  change  of  a  beneficiary 
at  the  will  of  the  member,  the  certificates  vested  in  the  wife  an  irre- 
vocable interest,  which  she  could  not  be  divested  of  wilhinit  her  con- 
sent; and  a  subsequent  by-law  of  the  society  authorizing  a  change 
of  beneficiary  at  the  will  of  the  member,  could  not  affect  the 
wife's  vested  interest  in  such  certificates,  so  as  to  authorize  the  inem- 
ber  to  change  the  beneficiary  without  the  wife's  consent.  See  also 
discussion  as  to  the  proper  construction  of  a  by-law:  to  the  holding 


THE    STATU    OF    COLORADO  57 

of  tlie  court  lli;it  siicli  will  not  he  given  retrospective  effect,  unless 
it  is  cleiir  tli;it  it  was  so  intended. 

Pittinger  vs.  Pittin,2:er.   .January,  1901,  2S   Colo.  308. 

The  contract  referred  to  in  tlie  foregoing  reference  was  made  be- 
tween the  member  and  the  Locomotive  J^ngineer's  Life  &  Accident 
Association,  which  was  probably  only  an  assessment  society,  and 
not  a  fraternal. 

Vested  Interests — Beneficiary. 

Where  a  certificate  was  paj'able  to  the  beneficiary  if  she  survived 
the  member.  l)nt  in  case  of  her  death  liefore  that  of  the  member, 
then  to  the  heirs  or  devisees  of  the  member,  it  was  held  that  the  wife 
of  the  beneficiary  had  no  such  vested  interest  in  the  certificate  as  to 
cast  upon  her  heirs,  or  personal  representatives,  any  interest  by 
reason  of  her  death,  if  it  occurred  prior  to  that  of  the  member. 

Anderson  vs.  Groesbeck  et  al.,  .January,  1S99,  26  Colo.  3. 

Heirs-at-law. 

As  to  \vho  are  heirs-at-law,  and  the  right  of  the  widow  of  a  mem- 
ber to  be  included  in  said  term,  see  construction  of  the  Colorado 
statute  upon  descent  and  distribution,  and  also  see  cases  cited  of: 

Gauch  vs.  St.  Louis  M.  L.  Ins.  Co.,  S8  111.  251; 
Benetit  Association   vs.   Sears.   114   111.   102; 
Mutual  Benefit  Association  vs.  Rolfe,  79  Mich.  140. 

The  court  distinguished  these  cases  from  the  one  at  bar. 

Anderson  vs.  Groesbeck  et  al..  January,  1S99.  26  Colo.  3. 

Beneficiary — Presumption  of  Legality. 

The  beneficiary  named  in  a  certificate  is  presumed  to  be  properly 
and  legally  named,  and  if  the  society  would  avoid  liability  on  the 


58  FRATERNAL    SOCIETY    LAW 

groiTud  that  the  beneficiary  is  not  one  allowed  by  the  laws  of  the 
society  to  be  so  named,  the  burden  is  on  the  society. 

Supreme   Lodge  Knights  of  Honor  vs.   Davis.  April,  1S99.   26  Colo. 
252. 

Officers  of  Local  Lodge — Agency. 

For  the  facts  in  a  case  upon  which  the  court  held  that  the  officers 
of  a  subordinate  lodge  Avere  agents  of  the  supreme  lodge,  not- 
withstanding- an  express  declaration  in  the  laws  of  the  society  to 
the  contrary,  see 

Supreme  Lodge  Knights   of  Honor  vs.   Davis.  April,  1S99.   26  Colo. 


Tender  of  Payments — Estoppel. 

AVhere  a  member  under  a  certificate  tendered  an  assessment  which 
was  refused  upon  the  ground  that  he  was  no  longer  a  member  of  the 
society,  he  lost  no  rights  by  failing  to  tender  subsequent  assessments, 
unless  he  had  been  notified  that  they  would  be  accepted. 

Supreme  Lodge  Knights  of  Honor  vs.   Davis.  April,   1S99,   26  Colo. 
252. 

Proofs  of  Death — Waiver  of. 

The  plea  that  proofs  of  death  have  not  been  furnished  cannot  be 
availed  of,  where  it  is  shown  that  prior  to  the  member's  death  the 
society  had  declared  his  certificate  null  and  void,  and  insisted  upon 
the  forfeiture  of  his  rights. 

Supreme  Lodge  Knights  of  Honor  vs.  Davis,  April,  1899.  26  Colo. 
252. 

Fraternals  are  Mutual  Societies. 

A  fraternal  society,  so  far  as  its  insurance  is  concerned,  is  deemed 
a  mutual  life  insurance  .society,  and  is  sitb.iect  to  the  same  general 
rules  of  law  applicable  to  mutual  life  insurance  companies. 


THE    STATE    OF    COLORADO  59 

Supreme   Lodge   Knights   ol    Honor   vs.    Davis,   Ai)ril.   1899,   2fi   Colo. 
252. 

Suit  by  Wrong-  Name, 

The  pi-oiiiisc  to  pay  in  a  certificate  was  in  the  roilowing'  language: 
"The  .sum  of  .$3,000  will  be  paid  by  the  Board  of  Control  of  the 
Eudowiuent  Eank  Knights  of  Pythias  of  the  World,"  to  the  benefi- 
ciary named  therein.  The  certificate  further  showed  that  it  was 
issued  under  the  direction  of,  and  that  the  member  was  bound  to 
full  compliance  with  the  laws  and  rules  of  the  Supreme  Lodge 
Knights  of  Pythias.  The  certificate  itself  was  issued  by  the  Presi- 
dent and  Secretary  of  the  Board  of  Control,  and  suit  was  brought 
against  the  Endowment  Rank  of  the  Order  of  Knights  of  Pythias. 
The  defendant  answered  by  that  name,  alleging  that  it  was  not  a 
per.son,  natural  or  artificial,  but  simply  the  name  of  those  members 
of  the  order  who  had  taken  out  benefit  certificates,  and  that  the  cer- 
tificate itself  was  issued  by  the  Supreme  Lodge  Knights  of  Pythias 
of  the  Woi^ld,  which  was  a  corporation ;  and  the  answer  further 
showed  that  the  suit  should  have  been  brought  against  such  corpora- 
tion. The  court  in  reaching  a  conclusion  said  that  the  suit  might  be 
maintained  as  brought,  and  discussed  the  cases  of  Kiights  of  Pyth- 
ias vs.  Kaliuski,  165  U.  S.  289 ;  Endowment  Rank  Knights  of  Pythias 
vs.  Rosenfeld,  92  Tenn.  508 ;  Burlington  Vol.  Relief  Co.  vs.  White, 
41  Nebr.  547;  Cornfield  vs.  Order  of  Brith  Abraham,  64  Minn.  261, 
and  distinguished  these  cases. 

Endowment  Ranl<  of  the  Ovder  Knights  of  Pythias  vs.  Powell,  April, 
1898,  25  Colo.  154. 

Change  of  Beneficiary — Vested  Interests. 

Unless  the  power  to  change  the  beneficiary  in  a  certificate  issued 
is  expressly  given,  either  by  the  certificate  itself,  or  by  the  laws  of 
the  society,  the  beneficiary  acquires  upon  the  issuance  and  delivery 
of  the  certificate  a  vested  and  irrevocable  interest. 

Love  vs.   Clune,   April,   1897,   24   Colo.   237. 


60  THE    STATE    OF    COLORADO 

The  above  case  construed  a  contract  issued  by  the  Locomotive 
Engineers'  Mutual  Life  &  Accident  Lis.  Ass'n.  which  was  declared 
to  be  a  mutual  benefit  life  society. 

Forfeiture — Reinstatement. 

Where  a  member  was  suspended  for  non-paj^ment  of  assessments, 
in  order  for  the  beneficiary  to  recover  on  the  lapsed  certificate,  it  is 
necessary  to  show  that  the  member  had  been  reinstated  before  death, 
or  that  he  had  done  all  that  was  required  by  the  laws  of  the  society 
to  entitle  him  to  such  reinstatement.  In  the  case  at  bar,  the  member 
had  been  forfeited  for  non-payment  of  assessments,  had  made  appli- 
cation for  reinstatement,  was  furnished  with  a  statement  of  the 
amount  due,  and  blanks  to  be  filled  out,  all  of  which  he  filled  out 
and  returned  to  the  society,  with  the  money  called  for  in  the  state- 
ment, and  also  furnished  a  certificate  of  good  health.  The  society 
upon  the  receipt  of  such  papers,  advised  the  member  that  iinder  the 
circumstances,  a  complete  physical  examination  and  report  would 
be  7"equired  the  same  as  in  the  ease  of  an  original  applicant.  The 
member  was  then  examined  by  a  physician,  who  discovered  that  the 
member  was  suffering  from  an  organic  disease,  from  which  the  mem- 
ber shortly  thereafter  died.  Upon  receipt  of  the  medical  examina- 
tion report,  the  application  for  reinstatement  was  refused,  and  it 
was  held  that  the  society,  upon  such  showing,  was  not  liable  to  the 
beneficiary. 

Brun  vs.  Supreme  Council  Am.  Legion  of  Honor,  Sept.,  1900.  15  Colo. 
App.   538. 

Beneficiary — Divorce  of  Wife — Legal  Heirs. 

Tlu'  laws  of  a  society  ]irovided  that  beneficiaries  shoukl  be  mem- 
bers of  the  family,  or  a  person  or  persons  related  to  the  member  b.v 
blood,  or  dependent  ujidh  him.  .iiid  Ihat  under  no  circumstances 
should  a  certificate  be  issued  to  any  other  person;  and  they  pro- 
vided further,  that  in  case  of  the  death  of  all  (he  beneficiaries  named 
before  the  death  of  the  nieinbcr  occurred,  and  he  lailcd  to  name 
another,  that  the  benefit  should  be  paid  to  tlic  member's  legal  heirs. 
A  cci'tificate  was  issued.  i>aval)l(^  to  the  nicmlier's  wife,  from  whom 


THl'J    HTATt:    OF    VOLORAUO  61 

he  was  sul>s<'(|iiciilly  divorced,  but  no  new  desigiuilion  of  a  benefi- 
ciary was  )nade,  and  npon  the  member's  death,  el;iim  was  made  by 
the  heirs-at-law  and  the  divorced  wife.  'I'lie  court  held  that  the 
procuring  of  the  divorce  w.-is  not  a,  legal  equivalent  to  the  death  of 
the  beneficiary,  so  as  to  vest  in  the  heirs  of  the  member  any  right 
to  the  fund.  The  court  held  that  the  heirs-at-law  were  not  entitled 
to  the  fuiul,  which  had  been  paid  into  court  by  the  society  under  a 
bill  of  inlerpleailer.  The  fund  was  given  to  the  divorced  wife,  ami 
the  court  in  its  opinion  discussed  numert)u.s  authorities  bearing  upon 
the  question  pro  and  con, 

Overhiser  vs.   Overhiser,   Sept.,  1S99,   14  Colo.  App.   1. 

Warranties — Representations. 

In  construing  au  ap])lieation  for  a  life  insurance  contract,  war- 
ranties are  not  favored,  are  not  to  be  cijeated  or  extended  by  con- 
struction, but  mu.st  arise,  if  at  all,  from  the  fair  interpretation  and 
clear  intendment  of  the  words  used  by  the  parties,  and  if  there  be 
any  doubt  as  to  the  character  of  the  statement,  it  should  be  held 
to  hiive  only  the  force  of  a  representation. 

Northwestern  Life  Assurance  Co.  vs.  Tietze,  January,  1901,  16  Colo. 
App.  205. 

Application — Failure  to  Complete — Refusal. 

Where  the  preliminary  papers  to  the  issuance  of  a  contract  of 
life  insurance  consisted  of  three  parts,  one  headed  "No.  1  of  Appli- 
cation." etc.,  containing  questions  to  be  projiounded  to  and  answered 
by  the  applicant,  and  to  be  signed  by  him,  one  headed  "No.  2  of  Ap- 
plication," etc.,  also  to  be  signed  by  the  applicant,  which  contained 
questions  to  be  propounded  by  the  medical  examiner  and  answered 
by  the  applicant,  and  one  headed  "No.  3  of  Application,"  etc.,  to 
be  signed  only  by  the  medical  examiner,  and  to  constitute  his  report 
to  the  company  of  the  result  of  his  examination,  together  with  his 
opinion  and  recommendation  as  to  the  risk.  It  was  held  that  part  3 
constituted  no  part  of  the  application  for  insurance,  and  where  the 
applicant  signed  and  delivered  the  first  two  pai'ts,  the  application 


62  FRATERNAL    SOCIETY    LAW 

was  complete,  and  the  refusal  of  the  applicant  to  permit  the  medi- 
cal examiner  to  conclude  his  examination,  upon  which  he  was  to 
make  his  report,  would  not  operate  as  a  withdrawal  of  the  applica- 
tion, and  its  refusal  by  the  company  was  a  refusal  of  his  application 
for  insurance. 

Webb  et,  al.  vs.  Bankers'  Life  Insurance  Co.,  April  1st,  1904,  19  Colo. 
App.  456. 


THE    STATE    OF    CONNECTICUT  63 


THE 

STATE  OF  CONNECTICUT. 

CHAPTER  7. 

General  Statutes,  Eevisiou  of  1902,  and  Public  Acts  1903. 

Secret  and  Fraternal  Societies  Defined. 

Section  3582.  A  secret  or  fraternal  society  shall  be  held  to  be  a 
corporation,  societj',  or  voluntary  association  organized  and  carried 
on  for  the  sole  benefit  of  its  members  and  their  beneficiaries,  and  not 
for  profit,  having  a  lodge  system,  with  ritualistic  form  of  work  and 
a  representative  form  of  government,  and  making  provision  for  the 
payment  of  benefits  in  case  of  death,  sickness,  or  physical  disability 
either  as  a  result  of  disease,  accident,  or  old  age,  provided  the  period 
in  life  at  which  payment  of  physical  disability  benefits  on  account 
of  old  age  commences  shall  not  be  under  seventy  years ;  or  to  provide 
for  the  payment  upon  the  expiration  of  a  fixed  period  of  not  less  than 
ten  years  to  members,  whose  beneficiary  or  distribution  period  may 
then  expire,  of  a  sum  not  exceeding  the  maximum  amount  named  in 
the  beneficiary  certificates  of  its  members.  The  fund  from  which 
the  payment  of  such  benefits  shall  be  made  and  the  fund  from  whicli 
the  expenses  of  such  association  shall  be  defrayed  shall  be  derived 
from  assessments  collected  from  its  members,  the  payment  of  death 
benefits  being  made  to  the  heirs,  blood  relatives,  husband  or  wife, 
affianced  husband  or  affianced  wife  of.  or  to  persons  dependent  upon, 
the  member.  Such  association  shall  be  exempt  from  the  provisions 
of  the  insurance  laws,  and  said  laws  shall  not  apply  to  them  unless 
they  are  expressly  designated  therein. 

Provisions  Under  Which  Societies  May  Continue  Business. 

Section  3583.     Everv  such  societv,  organized  under  the  laws  of 


64:  FRATERNAL    SOCIETY    LAW 

any  other  State  or  country,  now  doing  business  in  this  State,  may 
continue  such  business;  but  such  society  shall  comply  with  the  pro- 
visions of  this  chapter  in  regard  to  annual  reports,  shall  appoint 
the  insurance  commissioner  its  attorney  upon  whom  process  may  be 
served,  and  shall  file  with  said  commissioner  a  certified  copj'  of  its 
charter  or  articles  of  association,  and  a  copy  of  its  constitution  and 
by-laws  certified  to  by  its  secretary  or  some  corresponding  officer. 

When  Foreign  Societies  May  do  Business  Here. 

Section  3584.  Every  such  society  organized  under  the  laws  of 
any  other  State  or  country  may  be  admitted  to  do  business  in  this 
State  when  it  shall  have  filed  with  the  insurance  commissioner  a 
report  giving  the  information  required  by  Section  3585,  a  duly  cer- 
tified copy  of  its  charter  or  articles  of  association,  and  a  copy  of  its 
constitution  and  by-laws,  certified  to  by  its  secretary  or  some  cor- 
responding officei",  and  M'hen  it  shall  have  appointed  the  insurance 
ciiiunnssioner  its  attorney  in  this  State,  pursuant  to  Section  3596; 
provided  that  such  society  shall  be  shown  to  be  authorized  to  do 
business  in  the  State  or  country  in  which  it  is  organized.  If  the  laws 
of  such  State  or  country  do  not  provide  for  such  authorization  the 
insurance  commissioner,  within  a  reasonable  time  after  application 
to  do  business  in  this  State  has  been  made,  shall  examine  into  the 
condition,  affairs,  and  the  management  of  such  society  at  its  expense. 

Reports  to  Commissioner. 

Section  3585.  Every  such  society  doing  business  in  this  State 
under  the  jirovisions  of  this  chapter  shall,  on  or  before  the  first  of 
March  in  each  year,  file  witli  the  insurance  commissioner  a  report  of 
its  affairs  and  operations  during  the  year  ending  on  the  thirty-first 
of  December  next  preceding,  and  of  its  financial  condition  on  said 
last-mentioned  day.  Said  report  shall  set  forth  in  full  its  assets, 
the  mannei'  of  their  investment,  its  lia])ilities.  and  such  other  infor- 
mation as  the  commissioner  may  desire,  and  shall  be  verified  under 
the  oath  of  its  president  and  secretai'y,  or  by  its  corresponding  officers, 
and  shall  lie  made  upon  blank  forms  to  be  furni.shed  by  said  com- 
missioner.    Said  rejiort  shall  also  conlain  answers  to  the  following 


TIIIJ    HTATE    OF    COSXECTIVI  r  65 

questions:  (Ij  XuuiIk'I-  (iT  ciTt  iticjitcs  issued  duriiiL;  tlic  \-ear.  or 
iueinl)ei-s  iuliiiitted?  {'!)  Aiimunt  "T  iiideiiiiiily  aft'cctcd  tliei-ehy? 
(3)  Number  of  losses  or  beuefit  liabilities  incurred'  (4)  Number 
of  losses  or  beiictit  li;d)ilities  paid?  (5)  Amount  received  fr(jm 
each  assessment  I'nr  the  year?  (6)  Total  amoiuit  i)aid  members, 
beneficiaries,  legal  representatives,  or  heirs?  (7)  Number  and  kinds 
of  claims  for  which  assessments  have  been  made?  (8)  Number  and 
kinds  of  claims  compromised  or  resisted,  and  brief  statement  of 
reasons?  (9)  Does  the  society  charge  annual  or  other  periodical 
dues  or  admission  fees?  (10)  How  much  on  each  thousand  dollars 
annually  or  per  capita,  as  the  ease  may  be?  (11)  Total  amount 
received,  from  what  source  and  the  disposition  thereof?  (12)  Total 
amount  of  salaries  paid  to  officers?  (13)  Does  societ.y  guarantee 
in  its  certificates  fixed  amounts  to  be  paid  regardless  of  the  amount 
realized  from  assessments,  dues,  admission  fees,  and  donations? 
(14)  If  so,  what  is  the  amount  guaranteed  and  the  security  of  such 
guaranty?  (15)  Has  the  society  a  reserve  fund?  (16)  If  so.  how 
is  it  created  and  for  what  purpose,  the  amount  thei'eof,  and  how 
invested?  (17)  Has  the  society  more  than  one  class?  (18)  If  so, 
how  man.y,  and  the  amount  of  indemnity  in  each?  (19)  Number  of 
beneficiary  members  in  each  class?  (20)  If  voluntary  so  state,  and 
give  date  of  organization  ?  (21)  If  organized  luider  the  laws  of  this 
State,  under  what  law  and  at  what  time,  giving  chapter,  and  date  of 
the  passage  of  the  act?  (22)  If  organized  under  the  laws  of  any 
other  State  or  country,  state  such  fact  and  the  date  of  organization, 
giving  chapter,  and  date  of  the  passage  of  the  act?  (23)  Number 
of  certificates  of  beneficiary  memliership  lapsed  during  the  year? 
(24)  Number  in  force  at  the  beginning  and  the  end  of  the  year:  if 
more  than  one  class,  the  number  in  each  cla.ss?  (25)  Name  and 
address  of  president,  secretary,  and  treasurer,  or  corresponding 
officers?  The  insurance  commissioner  may  make  an  examination,  at 
the  expense  of  the  State,  of  the  books,  papei-s.  records,  and  vouchers 
of  such  society,  and  may  address  any  inquiries  to  such  soeiet\'  rela- 
ting to  the  business  contemplated  by  this  chapter,  and  such  society 
shall  jiromptly  reply  in  writing  under  the  oath  of  its  nresident.  sec- 
retary, or  treasurer,  or  of  its  corresponding  officers,  to  all  such 
inquiries,  and  shall  fortliwith  permit  such  examination  to  be  made. 


66  FRATERNAL    SOCIETY   LAW 

Permit  May  be  Granted  by  Commissioner — Appeal. 

Section  3586.  The  insurauce  commissioner,  upoa  application  bj' 
any  such  society  having  the  right  to  do  business  in  this  State,  and 
upon  its  compliance  with  the  provisions  of  this  chapter,  may  issue 
to  it  a  permit,  in  writing,  to  do  business  in  this  State,  said  permit  to 
continue  in  force  until  the  first  of  April  next  following  its  issue, 
luiless  the  same  be  sooner  revoked,  for  which  permit  such  .society 
shall  pay  to  the  commissioner  five  dollars;  but  an  appeal  may  be 
taken  by  any  such  applicant  to  the  superior  court  from  any  decision 
of  the  commissioner  made  in  pursuance  of  the  discretionary  power 
hereby  granted. 

Neglect  to  File  Reports — Penalty — Injunction. 

Section  3587.  Any  such  society  neglecting  to  make  the  report,  or 
to  appoint  the  insurance  commissioner  its  lawful  attorney,  as  pro- 
vided in  this  chapter,  shall  be  excluded  from  doing  business  within 
this  State.  Tlie  insurance  eommissionr  shall,  after  failure  to  make 
such  re])ort,  or  in  case  any  such  society  .shall  exceed  its  powers,  con- 
duet  its  business  fraudulently,  or  fail  to  comply  with  any  provision  of 
this  chapter,  at  once  notify  its  president,  secretary,  and  treasurer, 
or  its  corresponding  officers,  or  any  two  of  them,  and  give  them  an 
opportunity  to  be  heard  thereon  and  to  coiifurni  to  the  provisions 
of  this  chapter.  If  said  society  does  not.  within  len  days,  conform 
to  said  jjrovisions,  as  re(|iiin'd  by  the  insurance  commissioner,  lie 
shall  imnuxliately  commence  an  action  in  the  superior  court  for 
Halt  ford  coiuity  against  such  society,  to  enjoin  it  from  carrying  on 
business,  and  nu  injunction  against  any  such  society  shall  be  granted 
by  any  court,  e.xcejit  u|hiii  tin"  a|iplication  of  tlie  insm'ance  coinmis- 
sioner,  Xo  society,  so  enjoined,  shall  issue  new  certificates  until 
such  report  shall  be  made,  or  the  overt  act  or  violation  complained 
of  shall  have  been  corrected,  u(u-  until  the  costs  of  such  action  be 
paid  by  it.  If,  however,  the  court  shall  find  that  such  society  was 
not  in  default,  then  the  in.surance  commissioner  shall  at  once  rein- 
.state  such  society,  and  not  until  such  reinstatement  shall  such  society 
be  allowed  to  issue  certificates  of  meinl)ersliip  in  this  State.  Every 
person  acting  for  such  society,  or  for  any  subordinate  body  thereof, 
within  tliis  State,  after  it  has  been  enjoined  or  debarred  from  doinc 


THE    STATE    OF    CONNECTICUT  67 

business,  sluill   be  Hiipd  not  nioi'<'  tluiii   two   IiuimIivmI  dolhifs,  uv  be 
imprisoned  not.  int)i'e  thfUi  one  year,  oi'  both. 

Money  Due  From  Society  Not  Attachable. 

Section  3588.  Tlie  money  or  otlier  benefit  to  l)e  |)iii(l  by  any  society 
anthorized  to  do  business  under  tliis  cliapter  shall  not  be  liable  to  at- 
tachment by  trustee  or  other  process,  and  shall  not  be  seized,  taken, 
appropriated,  or  applied,  under  any  legal  or  equitable  process,  nor 
by  operation  of  law,  to  pay  any  debt  or  liability  of  a  certificate- 
holder  or  any  beneficiary  named  therein.  This  section  shall  apply  to 
all  fraternal  societies  legally  doing  business  in  this  State,  including 
the  societies  and  organizations  referred  to  in  Section  3592. 

Employment  of  Paid  Agents. 

Section  3589.  No  .such  society  doing  business  in  this  State  sludl 
employ  paid  agents  in  soliciting  or  procuring  members,  except  in 
organizing  local  branches  or  lodges. 

False  Representation — Penalty. 

Section  3590.  Every  jjerson  who  shall  knowingly  or  wilfully  make 
a  false  or  fraudulent  statement  or  representation,  in  or  with  refer- 
ence to  any  application  for  membership,  or  for  the  purpose  of  obtain- 
ing any  money  or  benefit  in  any  such  society  transacting  business 
under  the  provisions  of  this  chapter,  shall  be  fined  not  more  than  five 
hiuidred  dollars  or  be  imprisoned  not  more  than  one  year,  or  both ; 
and  every  person  who  shall  wilfully  make  a  false  statement  of  any 
material  fact  in  a  sworn  statement  as  to  the  death  or  disability  of  a 
certificate-holder  in  any  such  society,  for  the  purpose  of  procuring 
the  payment  of  a  lienefit  named  in  the  certificate  of  such  holder,  and 
every  person  who  shall  wilfully  make  a  false  statement  in  any  veri- 
fied repoi't  or  declaration  under  oath,  required  or  authorized  by  this 
chapter,  shall  be  guilty  of  perjury. 

Acting  for  Unauthorized  Society — Penalty. 

Section  3591.     Every  person,  acting  for  any  such  society  within 


(58  FRATERNAL    SOCIETY    LAW 

this  State,  unless  such  society  is  authorized  to  do  business  in  this 
State,  shall  be  fined  not  more  than  five  hundred  dollars  or  be  im- 
prisoned not  more  than  one  year,  or  both. 

Masons,  Odd  Fellows,  and  Other  Societies. 

Section  3592.  This  chapter  shall  not  apply  to  the  societies  of 
Masons  or  Odd  Fellows  located  in  this  State,  nor  to  associations  com- 
posed exclusively  of  their  respective  members,  nor  to  fraternal  socie- 
ties whose  sn])ordinate  or  national  bodies  pay  a  death  benefit  of  not 
more  than  one  hundred  dollars  and  a  weekly  side  l)enefit  of  not  more 
than  eight  dollars,  nor  to  any  organization  conducted  solely  for 
benevolent  and  charitable  purposes  whose  members  are  employed 
by  one  corporation  or  institution  or  by  more  than  one  similar  corpor- 
ation or  institution  or  whose  membership  is  confined  to  one  trade, 
art,  or  profession,  except  as  specified  in  Section  3588  :  Provided,  that 
any  society  of  JIasons  or  Odd  Fellows  located  in  this  State,  or  any 
association  composed  exclusively  of  Masons  or  Odd  Fellows,  may 
make  application  to  the  insurance  commissioner  to  be  included 
within  the  provisions  of  this  chapter,  as  provided  in  Section  3586, 
juid  when  any  such  society  or  association  has  once  come  under  the 
supervision  of  the  insurance  commissioner,  it  ^hall  remain  under  his 
supervision  and  control  so  long  as  it  shall  eontimie  to  do  business 
in  this  State. 

Insurance  Commissioner  to  Publish  Reports. 

Section  3593.  The  insurance  coniniissioucf  shall  publish  the  an- 
nual reports  of  such  societies,  or  the  substance  thereof,  in  his  report, 
under  a  separate  part  entitled  "Secret  or  Fraternal  Societies." 

Fees. 

Section  3594.  Every  society  to  which  this  chapter  is  apjilicable 
shall  pay  the  I'ullowing  fees  to  tlii'  insurance  coniniisioner :  for  tiling 
a  certified  copy  of  its  charter  or  articles  of  association,  five  dollai-s; 
for  filing  the  annual  report,  five  dollars:  fm-  filing  any  additional 
paper  required  by  law,  twenty-five  cents,  'i'hc  insui-ance  commissioner 
shall  al.so  collect  the  following  fees:  for  every  ei>rtificate  of  organiza- 


THE    f(TATE    OF    CONNECTICUT  6& 

tioii  111-  ('(iiii|ili;iiiC'P,  one  dolhir;  for  eMch  certified  cA)py  of  jtcrinit.  one 
(lolliir;  ;iii(l  I'or  each  certified  co])y  of  .iiiiiii;!!  repoi't,  five  dollMrs,  If 
any  State  shall  impose  upon  secret  or  fraternal  societies  fees  greater 
than  are  fixed  by  this  chapter  the  insurance  commissioner  shall 
collect  from  every  secret  or  fraternal  society,  incorporated  by  or 
orji'anized  under  tlu'  laws  of  such  other  Stale  and  admitted  to  trans- 
act business  in  this  >State,  the  same  fees  as  are  imposed  upon  similar 
societies  and  organizations  by  such  other  State. 

Transaction  of  Business  Defined  in  This  Chapter. 

Section  ^.ID.j.  The  transaction  of  tin-  Inisiness  defined  in  this 
elmpter  by  any  company,  corporation,  association,  partnership,  or 
by  any  individual  or  individuals,  other  than  as  herein  provided,  is 
forbidden. 

Good  Standing  Defined. 

The  l)y-laws  of  a  society  defined  a  member  in  good  financial  stand- 
ing, as  one  who  did  not  owe  the  society  for  fees,  diies,  or  assess- 
ments, or  anything  else  that  might  be  a  charge  against  him  as  dues, 
an  amount  eipud  to  six  month's  dues:  and  further  made  the  member's 
ledger  account  evidence  of  such  standing.  In  a  suit  b.v  the  benefi- 
ciary on  a  deceased  member's  certificate,  it  was  shown  that  the 
actual  indebtedness  of  the  member  to  the  society,  as  per  the  ledger 
account  was  incurred  thi'ough  the  breach  of  his  agreement  in  relation 
to  the  distribution  of  lottery  tickets,  issued  in  connection  with  a 
fair  given  by  the  society.  It  was  held  that  this  indebtedness  might 
be  added  to  his  impaid  dues  in  determining  his  financial  standing 
undei'  said  by-biAvs. 

Kelly   vs.    Court    Phelan    Foresters   of   America,    June    9th.    1905,    78 
Conn.  40. 

Resort  to  Civil  Courts. 

A  law  of  a  society  providing  that  the  member  shall  not  resort  to 
the  civil  courts  for  redress  of  an  alleged  injury  until  he  has  ex- 
hausted every  nu'ans  of  appeal  in  the  ordi'r.  is  not  void  as  an  attempt 


70  FRATERNAL    SOCIETY    LAW 

to  oust  the  courts  of  their  jurisdiction.  Compliance  with  sucli  li\  -law- 
is  essential  to  enable  the  member  to  restrain  the  enforcement  of  the 
order  of  the  society  suspending  him,  or  to  recover  damages  therefor, 
notwithstanding  such  order  was  based  upon  a  hearing  before  an 
illegally  constituted  committee. 

McGuinness  vs.  Court  Elm  City  Foresters  of  A.,  June  9th,  1905,  78 
Conn.  43. 

After-enacted  Laws, 

A  meiiiher  was  admitted  to  a  society  untler  an  express  agreement 
that  lu^  was  to  forfeit  his  membership  if  he  engaged  in  any  occupa- 
tion which  was  then,  or  might  thereafter  be  deemed  extra  hazardous. 
Subsequently  the  society  passed  an  amendment  increasing  the  list  of 
extra  hazardous  occupations,  and  including  in  such  list  that  of 
switchman.  The  amendment  was  not  in  terms  retroactive.  The  mem- 
ber was  killed  while  following  the  vocation  of  switchman.  The 
court  held  that  the  amendment  was  reasonable,  and  that  the  member 
was  bound  thereby, 

Gilniore    vs.    Kniglus    of    Columbus.    Jan.    14th,    1904,    77    Conn.    58. 

Conditions  Precedent  to  Liability — Expulsion — Election  by  Member. 

One  of  the  laws  of  a  society  provided  that  the  death  benefits  of  a 
member  dying  from  certain  specified  diseases  within  18:^  days  from 
the  date  of  liis  admission  should  be  $5.00  only,  in  that  of  other  cases 
it  should  be  .$500,00,  and  that  a  member  might  be  expelled  for  non- 
I)ayiiiciit  nf  dues,  and  that  no  meinbei-  should  be  reinstated,  except 
ui>on  making  regular  formal  applic;ition.  same  as  was  required  of 
new  members.  It  was  held  that  the  contract  of  admission  involved 
an  agreement  on  the  \);\v\  of  the  member  to  jiay  the  dues  and  abide 
by  the  laws  as  a  condition  i)i"ecedent  to  the  society  being  bound  to 
pay  death  benefits,  and  that  the  same  agreement  made  originally, 
arose  upon  the  member  being  reinstated.  Tt  was  further  held  that 
the  reinstated  member,  having  died  thereafter  of  a  specified  disease, 
within  the  183  days  after  his  reinstatement,  that  his  beneficiary  was 
entitled  to  the  death  benefit  of  $5.00  onlv.     Tt  was  furth(>r  held  in 


THE    STATE    OF    CONNECTICUT  71 

this  case,  that  though  the  society  did  not  observe  its  own  hiws  liter- 
ally when  expelling  a  member,  nevertheless,  as  the  member  elected 
to  treat  the  action  taken  as  effective,  and  had  been  exempted  from 
the  ])ayment  of  dues  during  the  term  of  his  susin'iisinn.  there  had 
been  a  waiver  of  tlie  literal  comiilianee  on  the  jiart  of  the  societ.y. 

O'Brien  vs.  Brotherhood  of  The  Union,  July  24th,  1903,  76  Conn,  52. 

Construction  of  Exempting  Statute — Attachment. 

The  supreme  court  in  passing  upon  Chapter  25,')  of  the  Public 
Acts  of  181)."),  as  amended  in  1897,  and  again  in  1899,  wherein  it  was 
provided  that  <dl  benefits  due  from  a  fraternal  society,  organized 
and  carried  on  for  the  sole  benefit  of  its  members  and  their  benefi- 
ciaries, and  not  for  profit,  and  which  had  a  lodge  system,  with  a 
ritualistic  form  of  work,  should  be  exempt  from  attachment,  held 
that  lienefits  due  from  a  mutual  aid  society,  which  had  no  ritual  of 
its  own,  though  one  of  the  requisites  of  membership  in  such  society 
was  that  applicants  should  be  members  of  other  societies  that  did 
have  such  a  ritual,  were  not  exempt  from  attachment. 

Miles  &   Co.    vs.    Odd   Fellows   Mut.   Aid   Ass'n,   July    24th,   1903,    76 
Conn.  132. 

After-enacted  Laws — Beneficiary. 

Every  member  of  a  society  agreed  on  becoming  such  to  conform 
to  the  by-laws  "now  in  force,  or  which  hereafter  may  be  adopted," 
It  was  held  that  the  by-laws  as  amended  and  in  force  at  the  time  of 
the  member's  death,  and  not  those  existing  at  the  date  of  his  admis- 
sion, determined  who  was  his  beneficiary  and  the  rights  of  such. 

Masonic  Mutual  Benefit  Association  vs.  Severson.  May  3rd.  1899.  71 
Conn.  719. 

Beneficiary — No  Vested  Interests. 

A  beneficiary  named  in  a  certificate  has  no  vested  interest  in  the 
same,  where  the  certificate  provides  that  it  is  not  to  be  paid  until 
the  member's  death.    Up  to  that  time,  the  member  may,  if  permitted 


7-2  FRATERNAL    SOCIETY    LAW 

by  tlie  hnvs  of  tlio  society,  change  the  beneficiary  at  -will,  although 
the  latter  may  have  advanced  the  money  to  pay  the  assessments  on 
the  certificate,  or  ma.v  have  made  the  payments  outright. 

Masonic  Mutual   Benefit  Ass'n  vs.   Tolles.   June   1st.   1S98.   70   Conn. 
537. 

Laws  at  Date  of  Death  Govern — Beneficiary. 

The  charter  and  laws  of  a  society  provided  that  death  benefits 
should  be  paid  to  such  person  or  persons  belonging  to  the  immediate 
family  of  the  member,  as  he  might  designate,  and  that  in  default  of 
any  designation,  the  funds  should  go  to  those  members  of  such 
family,  or  to  relatives  who  were  the  member's  heirs-at-law.  It  was 
held  that  this  provision  had  reference  to  conditions  existing  at  the 
date  of  the  member's  death,  and  not  to  the  day  of  his  admission. 

Knights  of  Colunibus  vs.  Rowe.  June  1st,  1S9S,  70  Conn.   545. 

Member 's  ' '  Family ' ' — Beneficiary. 

An  unmarried  man.  living  in  his  father '.s  family,  became  a  mem- 
ber of  a  .society,  and  procured  a  certificate  therein,  issued  to  him. 
payable  to  his  father  as  beneficiary.  Subsequently  the  member  mar- 
ried, and  lived  with  his  wife  and  child,  born  to  him.  and  away  from 
his  father's  family.  While  so  living,  he  died  without  having  changed 
the  original  designation  of  his  father  as  his  beneficiary.  It  was  held 
that  the  wife  ant!  child  constituted  the  member's  immediate  family, 
and  were  entitled  to  the  fund.  Tlii'  above  holding  was  in  a  case 
whi'i-i'  llu'  society  filed  a  liill  of  interpleader. 

Knights  of  CoUimljus  vs.  Rowe.  June  1st.  1.S9S,  70  Conn.   545. 

Powers  of  a  Voluntary  Society. 

It  is  williiii  ihc  power  of  a  voluntary  benevolent  society  to  give  a 
promis.sory  note  or  hill  of  exchange  for  the  jiuriiose  of  eompromis- 
ing  a  suit  ])ending  against  it. 


THE    STATE    OF    COA'NECTICUT  73 

Couit  Haiuoiiy  Aiiitiican  Order  ol'  Foresters  vs.  Court  Abraham 
Lincoln  American  Order  of  Foresters,  June  17tli.  1S98,  TU  Conn. 
634, 

Validity  of  Statute  of  Limitation. 

For  a  ca.se  disc'u.ssiiii;'  anil  uplinldin^  the  pnivisiim  of  a  eonti'act 
wliereia  it  was  provided  that  no  suit  sliouki  be  brought  upon  it, 
except  within  one  year  from  the  decease  of  tlie  insured,  see  the  fol- 
lowing well  considered  case. 

Vincent  vs.  Mnt\ial  Reserve  Fund  Life  Ass'n,  IVIay,  1904,  74  Conn. 
684. 


74  FflATERXAL    SOCIETY    LAW 


THE 

STATE  OF  DELAWARE. 

CHAPTER  8. 

"An  Act  to  Re-enact  and  Revise  the  Insurance  Laws  of  Delaware, 
in  order  to  make  them  conform  with  the  Requirements  of  the 
Amended  Constitution  and  of  the  General  Corporation  Law." 

Chapter  99,  Volume  22,  as  Aiiieiuled.  1901. 

The  following  are  the  only  sections  of  the  act  which  concern  Fra- 
ternal Benefit  Societies. 

Section  2.  The  following  shall  be  tlie  duties  of  the  Insurance 
Commissioner : 

First.  To  see  tliat  all  laws  of  this  State  respecting  insurance 
com])anies  are  faithfully  executed,  and  to  require  from  all  companies 
not  chartered  by  the  laws  of  this  State,  transacting  the  business  of 
insurance  in  this  State,  a  certified  co])y  of  their  cliarter  or  declara- 
tion of  organization,  a  certificate  of  the  name  and  residence  of  an 
agent  or  agents  of  said  compaiiy,  resident  in  this  State,  upon  whom 
service  of  process  against  said  com|)any  may  lie  made,  both  of 
which  shall  be  filed  in  his  office. 

Second.  To  examine  the  affairs  and  condition  of  any  company 
doing  the  liiisincss  oi'  insurance  in  this  State,  chartered  by  the  laws 
of  this  Stale,  wiienever  it  shall  be  tlemanded  by  the  written  applica- 
tion <d'  not  less  than  five  i)oliey-holders  insured  in  such  company  to 
the  anioiint  of  ten  thousand  dollars  ($10,000),  and  to  {)ublish  the 
result  of  such  examination  in  one  or  more  newspapers  of  this  State, 
whenever  he  deems  it  for  the  interest  of  the  ])ublic  so  to  do.  and  for 
the  purjiose  of  su<di  examinations  lu'  sliall  have  |)ower  to  recjuire  free 
access  to  all   books  .-hkI    papers  ol'  any    insni'aiicc   company,   oi-  the 


THE    STATE    OF    DELAWAItl-:  75 

agents  theri'of,  doing  business  witiiin  tins  Stiile.  and  1i>  cXiiiiiiiii'  any 
officer,  agent  or  employee  of. such  coniiJany.  undei'  oalli  »r  at'firina- 
tion,  which  he  is  hereby  empowered  to  administer,  relative  to  the 
affairs  and  condition  of  any  company;  and  further,  he  may,  at  any 
time,  require  from  any  eomjjany  doing  the  business,  of  insurance, 
or  anj'  of  its  officers  or  agents,  statements  on  such  points  as  he  deems 
necessar^y  and  proper  to  elicit  a  full  and  fair  exhibit  of  its  business 
and  standing,  upon  the  application  of  not  less  than  five  policy- 
holders of  any  company,  to  the  amount  of  ten  thousand  dollars. 
The  Insurance  Commissioner  may  employ  exjuTt  assistance  in  ex- 
amining the  affairs  of  such  company,  and  charge  the  cost  thereof 
in  the  expenses  to  be  paid  by  the  company. 

Third.  Whenever  the  Insurance  Commissioner  sliali  have  rea.son 
to  believe  that  any  insurance  company  which  has  been  heretofore 
incorporated  or  chartered,  or  shall  hereafter  be  chartered  or  incor- 
porated luuler  any  law  of  this  State,  is  insolvent,  or  fraudulently 
conducted,  or  that  its  assets  are  not  sufticient  f(U'  carrying  on  the 
business  of  the  same,  or  that  it  has  failed  to  coyiply  with  the  pro- 
visions of  this  Act,  or  that  its  condition  is  such  as  to  render  its 
further  proceeding  hazardous  to  its  policy-holders  oi'  to  the  public; 
notwithstanding  any  special  provision  ui-anted  in  its  charter  or 
incorporation,  the  Insurance  Commisioner  shall  revoke  its  certificate 
of  authority  to  do  business,  and  shall  eomniunicate  the  fact  to  the 
Attorney-General,  whose  duty  it  shall  then  become  to  file  a  bill  or 
petition  in  Chancery,  in  the  name  of  the  State,  setting  forth  the 
facts,  and  thereupon  to  apply  to  the  Court  of  Chancery  of  any  county 
in  which  said  company  may  be  doing  business,  or  to  the  Chancellor 
in  vacation,  for  an  order  refpiiring  said  c(unpaiiy  to  show  cause  why 
their  business  should  not  be  closed.  In  a  jiroper  ease  made,  the  said 
Court,  or  the  Chancellor  in  vacation,  shall  have  power  to  appoint  a 
receiver  to  take  charge  of,  settle  and  close  up  the  aft'airs  of  said 
company  under  the  direction  of  the  said  court,  to  enjoin  it  from 
doing  business,  and  to  make  such  lU'der  and  (l(>cree  as  may  be  neces- 
sary or  proper. 

Fourth.  To  furnish  t(»  the  companies  re(|uired  by  this  Act  to 
report  to  him,  all  necessary  blank  forms  for  the  statements  required, 
and  to  publish  annually,  on  or  before  the  first  day  of  .Tuly,  (nice  a 


76  FRATERXAL    SOCIETY    LAW 

week  for  three  weeks,  in  ;it  leiist  two  newspMpers  <ii'  tliis  State,  the 
names  of  the  insurance  companies  that  liave  tiU'd  st;itenients  ajiree- 
ably  to  the  provisions  of  this  Act.  and  to  whom  certiticates  of  author- 
ity have  been  issued ;  and  he  shall  also  state  when  and  where  each 
company  was  incorporated,  and  its  aggregate  assets  and  lialiilities. 
and  its  receipts  and  expenditures  for  the  preceding  year;  the  cost  of 
such  publication  to  be  borne  equally  by  said  companies,  and  the 
amount  to  be  paid  by  each  shall  be  deposited  with  the  Insurance 
Commissioner  at  the  time  the  annual  statement  is  furnished  as  herein 
provided.  *  «#*?*#* 

Section  -i.  Every  insurance  i-ompany  doing  the  business  of  insur- 
ance within  this  State,  shall,  annually  on  or  before  the  first  day  of 
March,  deliver  to  the  Insurance  Commissioner  a  full  detailed  state- 
ment of  the  condition  and  business  of  such  comi)any  for  the  year 
ending  on  the  j)revious  twenty-first  day  of  l)ecenii)er.  which  state- 
ment shall  be  verified  l)y  llie  oatli  or  affirmation  of  the  president  or 
vice-president  and  secretai'y  or  other  officer.  Provided,  that  of  the 
statement  of  the  United  States  branch  of  any  foreign  company  cer- 
tification b>  the  manager  of  said  branch  in  the  United  States  shall 
be  sufficient.  Said  statement  shall  be  on  blanks  jirejiared  and  fur- 
nished by  the  Insurance  Commissioner  for  that  i>urpose,  and  shall 
contain  the  name  of  the  company,  where  located,  when  and  where 
incorporated  or  organized,  the  amount  of  paid  np  capital,  with  a 
detailed  statement  of  all  assets,  showing  the  amount  of  ca.sh  on  hand, 
in  bank  or  in  the  hands  of  agents;  the  amoiuit  and  actuiil  value  of 
real  estate  owned  by  the  company,  and  the  amount  of  incumbrances 
thereon:  the  number  of  Government,  State  and  Municipal  ;ind  other 
bonds  owned,  and  the  market  and  jijir  value  of  the  same:  the  inimber 
of  shares  of  stock  of  every  kind  owned,  and  the  market  and  ])ar 
value  of  the  same:  the  amount  loaned  on  bond  and  mortgage,  with 
the  actual  cash  \aluc  of  llir  propri-t.\-  mortgagi'd.  and  whether  sucb 
pro])ert\'  is  sub.ject  1o  any  other  lien  or  liens  paramount  to  sueh 
mortgage,  and  the  auiiregate  amount  of  sueh  paramount  liens:  the 
amount  loaned  on  all  olhei-  seeiiril  ies.  slaliuL:  Ihe  name  and  kiinl  of 
secui-ities.  ;ind  Ihe  aniounl  loaned  on  each:  also  statiiii:  the  lialiilit.v 
and  indebtedness  of  such  ecunpany  :  the  amount  of  losses  against  the 
company  adjusted  and  unpaid.  Ihe  anKUint  in  |)rocess  of  adjustment 
or   in    susp<Mise.    ineludinL;-   all    reported    ami    supposed    losses,    losses 


THE   l^TATE   OF  DELAWARE.  77 

resisted,    iiiclmliny    intei'est    iind    dtlicr    expenses    tlu'iedii  ;    mikI    all 
other  liabilities,  claims  ;nid  deiiiMiids  whatsoever  against  the  com-  • 
pany,  and  all  other  information  necessary  and  proper  to  full\-  set 
forth  a  full  and  fair  exhibit  of  its  business  and  standing. 

Section  6.  Kvei'v  corporation,  company,  association,  society,  part- 
nership or  hody  of  auj'  kind,  chartered,  incorporated,  organized  or 
associated  together  in  this  State,  or  in  any  State  other  than  this, 
doing  business  in  this  State,  and  issuing  or  i)roposing  to  issue  any 
policy,  or  certificate,  or  instrument  of  any  kind  by  which  any 
sum  or  assessment  or  luMiefit  of  any  kind  is  promised,  shall  be 
deemed  to  be  an  insurance  company  within  the  meaning  and 
subject  to  the  provisions  of  this  Act,  and  every  such  company,  or  any 
coni])any  chartei'cd,  incorporated  or  organized  either  under  the  laws 
of  this  or  any  otiier  State  for  the  insurance  of  lives  upon  the  assess- 
ment or  beneficial  i)lan.  and  desiring  to  do  l)usiness  in  this  State, 
shall  eom])ly  with  all  of  the  requirements  of  this  Act  respecting 
mutual  companies  incorporated  under  the  laws  of  this  State,  and 
life  insurance  compaiues  not  incorporated  under  the  laws  of  this 
State,  and  then  the  Insurance  Commissioner  shall  issue  to  it  his  cer- 
tificate of  authority;  provided,  that  every  such  company  shall  not 
be  required  to  maintain  a  cash  reserve,  nor  shall  policies  issued  by 
it  be  subject  to  the  provisions  of  the  fifth  and  sixth  clauses  of  the 
second  section  of  this  Act;  and  provided,  also,  that  any  benevolent, 
charitable  or  fraternal  organization  or  association  duly  organized, 
or  existing,  or  which  may  hereafter  be  duly  organized,  doing  busi- 
ness in  this  State,  which  engages  or  employs  agents  or  solicitors  in 
collecting  premiums  or  assessments  other  than  at  their  meeting  or 
lodge  room,  shall  be  and  hereby  is  required  only  to  submit  to  the 
Insurance  Commissioner  a  statement,  such  as  is  specified  in  Section 
3  of  this  Act,  and  pay  a  fee  of  ten  dollars  for  the  filing  of  such 
annual  statement.  If  from  the  statement  sid)mitted  it  shall  appear 
that  the  affairs  of  the  organization  or  association  are  in  such  a  con- 
dition that  its  further  operation  would  be  a-danger  to  the  public,  the 
Insurance  Commissioner  shall  proceed  against  it  in  the  manner  pro- 
vided fi>r  in  Section  2.  third  clause  of  this  Act;  provided  further, 
however,  that  this  Act  shall  not  in  any  way  be  constriunl  to  ai)ply 
to  the  Railroatl  Relief  AsscM'iation.  or  1o  secret  cliarilabh^  or  sei'ret 
beneficial  organizations. 


78  FRATERXAL    SOCIETY    LAW 

t 

Section  7.  No  insurance  company  or  corporation  shall  be  engaged 
,in,  prosecute  or  transact  any  insurance  business  within  the  limits 
of  this  State,  without  first  having  obtained  authority  therefor,  agree- 
ablj'  to  the  provisions  of  this  Act.  and  every  such  company,  not 
incorporated  under  the  laws  of  this  State,  shall,  before  doing  business 
as  aforesaid,  deliver  to  the  Insurance  Commissioner  a  certified  copy 
of  its  charter  or  declaration  of  organization,  and  also  a  certificate, 
in  such  form  as  may  be  provided  by  the  Commissioner,  of  the  name 
and  residence  of  some  person  or  agent  within  this  State  upon  whom 
service  of  process  may  be  made,  and  all  processes  against  such  com- 
pany issued  out  of  the  courts  of  this  State,  may  then  and  thereafter 
be  served  upon  such  person  or  agent  so  designated,  and  no  person  or 
persons  shall  procure  or  solicit  any  citizen  or  resident  of  this  State 
to  take  out  a  ])olicy  of  insurance  in  any  insurance  company  or 
corporation  not  authorized  to  transact  business  within  this  State. 
or  act  within  this  State  as  agent  for  such  company  or  corporation 
(or  any  person  or  association  of  individuals  doing  a  like  business  and 
not  authorized  to  transact  business  within  this  State)  or  otherwise 
in  any  manner,  directly  or  indirectly,  aid  in  the  transaction  of  the 
business  of  or  in  the  collection  of  any  premiums,  dues  or  assess- 
ments by  or  for  such  company,  corporation,  person  or  association  of 
individuals,  except  in  the  prosecution  or  defense  of  suits  at  law, 
under  the  penalty  upon  conviction  of  being  a  misdemeanor  and  sub- 
ject to  a  fine  or  imprisonment,  or  both,  at  the  discretion  of  the  court. 
It  shall  not  be  lawful  for  any  person  to  act  within  this  State  as 
agent  or  otherwise  in  receiving  or  procuring  applications,  or  in  any 
manner,  directly  or  indirectl.v.  to  aid  in  transacting  the  business  of 
insurance  permitted  by  this  Act  without  first  obtaining  from  the 
Insurance  Commissioner  a  State  license  under  the  penalty  upon  con- 
viction of  being  a  misdemeanor  and  subject  to  a  fine  or  imprison- 
ment, or  both,  at  the  discretioTi  of  the  court. 

Section  8.  The  Insurance  Commissioner  shall  have  a  seal  of  office 
surrounded  by  the  words  "Insurance  Commissioner  of  the  State  of 
Delaware."  All  certificates  and  other  official  papers  shall  bo  accom- 
panied with  an  impression  of  this  seal.  An.v  instrument  cari'fully 
executed  by  the  Insurance  Commissioner  of  this  State,  and  authenti- 
cated by  his  seal  of  office,  sball  he  received  in  cvidein'c  in  the  courts 
of  this  State,  and  copies  of  ])a])ers  ami  records  i)i  his  office,  so  authen- 


Tin:    STATE   OF  DKLAWAllE.  79 

tieatcd,  shall  lie  riM/civt'd  as  cvidcncr  witli  tho  same  pffcct  as  the 
originals. 

Section  !).  If  any  ixm'sdh  iiiakin>;-  an  oatli  or  affirmation  rcqnircd 
by  this  Act,  or  if  any  pei'son  being  or  assuming  to  be  an  officer  or 
agent  of  any  insurance  company  incorporated  by  this  State  making 
any  oath  or  affirmation  required  by  the  insurance  laws  of  any  other 
State,  shall  swear  falsely,  or  make  a  false  affirmation,  he  shall  be 
guilty  of  the  crime  of  perjury  and  shall  be  subject  to  the  punish- 
ment prescribed  for  jierjury  under  the  laws  of  this  State.  Any 
company  or  persons  otherwise  violating  this  Act  shall  be  guilty  of  a 
misdemeanor,  and  upon  conviction  thereof,  by  indictment,  shall  be 
subject  to  imprisonment  not  exceeding  one  year,  or  a  fine  not  ex- 
ceeding one  thousand  dollars,  or  both,  at  the  discretion  of  the  court, 
and  the  Insurance  Commissioner  shall  suspend  any  company  so  con- 
victed, or  whose  agent  is  so  convicted,  from  doing  iMisiness  within 
this  State,  until  the  fine  is  paid. 

Section  10.  There  shall  be  paid  to  the  Insurance  Connnissiouer  by 
every  company  to  which  this  Act  applies  the  following  fees:  For 
filing  the  declaration  or  certified  cop.y  of  charter,  ten  dollars:  for 
filing  the  annual  statement  of  companies  authorized  to  do  business 
in  the  State,  ten  dollars ;  for  the  annual  publication  of  the  condition 
of  the  companies  authorized  to  transact  business  in  the  State,  b.v 
three  or  more  newspapers,  a  sum  to  be  estimated  by  the  Commis- 
sioner to  cover  cost  of  publication ;  for  issuing  certificate  of  author- 
ity to  every  foreign  insurance  company,  twenty-five  dollars,  and  the 
fee  to  the  Commissioner  for  issuing  the  same,  two  dollars;  agent's 
certificate  of  authority  to  represent  each  company,  two  dollars;  for 
issuing  a  State  license  to  a  foreign  life  or  foreign  fire  insurance 
agent,  or  a  foreign  insurance  agent  other  than  life  or  fire,  five  dollars, 
and  the  fee  to  the  Connnissioner  for  issuing  the  same  for  each  license, 
fifty  cents,  and  one  and  one-half  per  centum  on  the  gross  amount  of 
premiums  received  and  assessments  collected  bj'  each  and  every 
foreign  insurance  company ;  and  for  every  certified  copy  of  each  cer- 
tificate of  authority  to  foreign  insurance  companies,  two  dollars ;  for 
every  copy  of  any  paper  filed  in  his  office,  twenty  cents  per  folio  of 
one  hundred  words,  and  for  affixing  the  official  seal  to  stich  copy 
and  certifviug  the  same,  the  sum  of  one  dollar;  for  official  examina- 
tion of  companies  under  this  Act,  the  actual  expenses  incurred :  the 


80  FRATERNAL    SOCIETY    LAW 

said  lusurance  Commissioner  shall  receive  a  sum  not  exceeding 
fifteen  hundred  dollars  per  annum,  which  sum,  together  with  the 
sum  of  six  hundred  dollars  to  be  paid  as  an  annual  salary  to  his 
clerk,  which  said  clerk  shall  be  appointed  by  the  Insurance  Commis- 
sioner, shall  be  paid  quarterly  by  the  State  Treasurer,  in  the  manner 
prescribed  for  the  payment  of  the  salaries  of  other  State  officers,  and 
shall  be  a  full  compensation  for  all  the  duties  imposed  upon  him  by 
the  various  laws  heretofore  and  hereby  and  hereafter  to  be  enacted, 
unless  otherwise  provided,  including  the  superintending  of  the  publi- 
cation of  his  reports.  He  shall  hand  over  the  fees  collected  by  him 
for  the  use  of  the  State  to  the  State  Treasurer  in  the  months  of  Maj' 
and  December.  The  Insurance  Commissioner  shall  receive  no  other 
compensation  from  the  State,  except  the  necessary  expenses  of  his 
office,  such  as  postage,  printing,  stationery,  etc.,  which  shall  be 
allowed  by  the  General  Assembly. 

Section  15.  Any  insurance  company  or  association  wilfully  viola- 
ting or  failing-  to  observe  and  comply  with  any  of  the  provisions  of 
this  Act.  appliealile  thereto,  shall  be  sub.iect  to  miuI  liable  to  pay  a 
penalty  of  five  liundred  dollars  for  each  violation  thereof,  and  for 
each  failure  to  observe  and  comply  with  an\:  provisions  of  this  Act : 
such  penalty  may  be  collected  and  recovered  in  an  action  brought  in 
the  name  of  the  State,  in  any  court  having  .iurisdiction  thereof.  No 
insurance  company  or  association,  whose  authority  to  transact  busi- 
ness in  this  State  .shall  have  been  so  revoked,  shall  be  again  author- 
ized or  permitted  to  transact  business  herein  until  it  shall  have  paid 
the  aMio'.iiit  of  luiy  such  judgmcnl.  and  shall  have  filed  in  the  office 
of  the  Insvu'ance  Commissioner  a  certificate,  signed  by  its  president 
or  oilier  idiief  officer,  to  the  effect  that  the  terms  and  obligations  of 
the  ]irovisions  of  this  Act  are  accepted  by  it  as  a  part  of  the  con- 
ditions of  its  right  and  Miitlmrily  to  transact  business  in  this  State. 

The  following'  jtrovisions  of 

"An  Act  to  require  all  Insurance  Companies  organized  and  existing' 
under  the  laws  of  other  States  and  Foreign  Countries  and  doing 
business  in  Delaware,  to  appoint  the  Insurance  Commissioner  of 
Delaware  their  attorney  to  accept  service  of  legal  process  in 
Delaware."    Approved  April  13,  1905, 


THE    STATE   OF  DELAWARE.  81 

also  scciii  1()  ;i|)j)ly  1(i  IViili'iMi.'il  licnrlil   sdcirtii's: 

Seetidu  1.  Xo  iiisiii'.-iiu'i'  I'dnipiiiiy.  cdriiniMl  imi.  or  iissociMtioii 
organized  under  tlic  l;iws  of  ;iiiy  olhcr  StMtc,  or  any  i'lU'ciyn  eonntry, 
shall  directly  or  indirectly  issue  policies,  take  i-isks.  ox  ti-ansact  busi- 
ness in  this  State,  until  i1  shall  have  tirsl  appointed  in  writing  the 
Insurance  Commissioner  of  this  .Stiite  to  lie  its  attoi-ney  in  this  State, 
upon  whom  all  lawful  process,  in  any  action  or  jiroceeding  against 
it,  may  be  served  with  the  same  effect  as  if  the  company,  cori)ora- 
tion,  or  association  existed  in  this  State.  Said  power  of  attorney 
shall  stii)ulate  and  agree  on  the  part  of  the  company,  corporation, 
or  association,  that  any  lawful  process  against  the  same  which  is 
served  on  said  attorney  shall  be  of  the  same  legal  force  and  validit.v 
as  if  served  on  the  company,  corporation,  or  association,  and  that 
the  authority  shall  continue  in  force  so  long  as  any  certificate  of 
membership,  policy,  or  liability  remains  outstanding  against  the  com 
jiany,  corporation,  or  association,  in  this  State,  A  certificate  of  such 
appointment,  didy  certified  and  authenticated,  shall  be  filed  in  the 
office  of  the  Insiirance  Commissioner,  and  copies  cei'tified  by  him 
sliall  be  sufificient  evidence.  Service  ujion  such  attorne\-  shall  be 
sufficient  u])on  the  principal. 

Section  '1.  Whenever  lawful  jirocess  against  an  insurance  com- 
pany, corporation,  or  association,  shall  be  served  upon  the  Insurance 
Commissioner,  he  shall  forthwith  mail  a  copy  of  such  process  to  the 
secretary  of  the  company,  or  in  the  case  of  companies  of  foreign 
countries,   to  the  I'esident   manager,   if  any.   in   this  country. 

Section.  '■\.  Whenever  service  of  process  on  an  insurance  com- 
pany ma>'  be  made,  by  law,  on  the  Insurance  Commissioner  of  this 
State,  such  Commissioner  may  from  time  to  time  designate  some  per- 
son in  his  office  upon  whom,  in  his  absence,  service  of  snch  process 
may  be  made;  and  such  service  shall  be  of  the  same  force  and  effect 
as  though  made  on  the  Commissioner  pei-sonally. 

"An  Act  regulating-  Life  Insurance  Companies  and  prohibiting  the 
Diversion  of  Funds  for  Political  Purposes."  Approved  March  5, 
1907. 

Section  1.  No  insurance  company  or  association  including  fra- 
ternal   lieneficiarx'   ass<iciations.   doing   business    in   this   State,   shall 


}j2  FRATJiKXAL    SOCIETY    LAW 

directly  or  indirectl.v,  pay  or  use  or  offer,  consent  or  agree  to  pay 
or  nse  any  money  or  property  for  or  in  aid  of  any  political  party, 
committee  or  organization,  or  for  or  in  aid  of  any  corporation,  joint 
stock  or  other  association  organized  or  maintained  for  political 
purposes,  or  for  or  in  aid  of  any  candidate  for  political  office,  or 
for  nomination  for  such  office,  or  for  any  political  purpose  what- 
so-ever,  or  for  the  reimbursement  or  indemniticatiou  of  any  person 
for  money  or  property  so  used.  Any  officer,  director,  stockholder, 
attorney  or  agent  of  any  corporation  or  association  which  violates 
any  of  the  provisions  of  this  Act.  who  participates  in,  aids,  abets, 
or  advises  or  consents  to  any  such  violation,  and  any  person  who 
solicits  or  knowingly  receives  money  or  property  in  violation  of  this 
act.  shall  be  guilt.v  of  a  misdemeanor  and  be  punished  by  imprison- 
ment for  not  more  than  one  year  and  a  fine  of  not  more  than  one 
thousand  dollars  ($1000).  and  any  officer  aiding  <ir  abetting  in 
any  contribution  made  in  violation  of  this  act,  shall  be  liable  to 
the  company  or  association  for  the  amount  so  contributed.  No 
jierson  shall  he  excused  from  attending  and  testifying,  or  producing 
any  books,  papers  or  other  documents  before  any  court  or  magis- 
trate, upon  an3'  investigation,  proceeding  or  trial,  for  a  violation 
of  any  of  the  provisions  of  this  act,  upon  the  ground  or  for  the 
reason  that  the  testimony  or  evidence,  documentary  or  otherwise, 
required  of  him  may  tend  to  incriminate  or  degrade  him;  but  no 
person  shall  be  prosecuted  or  sub.iected  to  any  penalty  or  forfeiture 
for  or  on  account  of  any  transaction,  matter  or  thing  concerning 
which  he  may  testify  or  produce  evidence,  documentary  or  other- 
wise, and  no  testimony  so  given  or  produced  shall  be  used  against 
him  upon  any  criminal  investigation  or  proceeding. 

Juror  Member  of  Society  in  Suit. 

The  fact  that  a  .juror  is  a  member  of  the  Independent  Oriler  of 
Odd  Fellows  does  not  disqualify  him  from  sitting  in  a  ease  where 
a  subordinate  lodge  of  such  order  is  a  part.v  to  the  suit,  such  dis- 
qualification to  sit  being  confineil  to  iiicml)ers  of  the  particular  lodge 
in  llir  suit. 

Di-laware   Lodgp  No.   • .   I.   O.   O.   V.   vs.    Allinon.   Dec    15tli.   1897. 

1   Pennewill's  Del.  Rep.   160. 


THE   STATE  OF  DELAM'ARE.  83 

Resort  to  Civil  Courts. 

Ill  Mil  iic'tidii  n-iiiiiist  ;i  siilxirdiiKite  lodge  for  sick  benefits,  the 
constitution  and  by-laws  of  tiie  soeii'ly  constitnte  the  contraet  tic- 
tween  the  parties,  and  where  these  laws  iirovide  that  the  right  of  a 
member  to  bi>iiefits  shall  be  aseerfaiiied  in  a  particular  mode,  that 
mode  must  be  pursued  befori'  the  member  can  enforce  his  claim  in 
the  {t<Mirts. 

Delaware  Lodge  No.  ,  I.   O.   O.   F.  vs.   Allmon,  Dec.  15th,  1S97, 

1   Pennewill's  Del.  Rep.   IGO. 

Statute  Not  Retroactive — Beneficiaries. 

A  certificate  was  issued  to  a  member  payable  on  his  death  "to 
such  person  or  pei-sons"  as  he  might  name  on  the  records  of  the 
conclave,  or  on  the  face  of  his  certificate  direct  the  same  to  be  paid. 
On  tlie  date  when  the  certificate  was  received,  the  member  indorsed 
thereon  that  the  benefits  named  in  llie  certificate  should  be  paid  to 
one  Emmons,  who  was  at  that  time  a  creditor  of  the  member.     The 
member  died  in  1905,  without  having  changed  the  name  of  the  bene- 
ficiary.   This  certificate  was  issued  in  1887,  and  in  1889  the  society 
amended  its  laws  specifically  providing  that  beneficiaries  should  be- 
long to  certain  classes,  namel.v,  "to  the  member's  father,  mother, 
wife,  children,  grand-childreu,  grand  parents,  brothers,  or  sisters, 
or  any  or  as  many  of  them  as  the  member  shall  desire  and  specifv," 
and  also  included  dependents.     It  was  conceded  in  the  case  that  at 
the  time  when  the  certificate  was  issued  Emmons  was  a  proper  bene- 
ficiar.v  under  the  laws  of  the  societ.v  as  they  then  stood,  and  it  was 
also  conceded  that  the  member  had  notice  of  the  change  of  the  laws 
of  the  society,  and  was  requested  to  surrender  and  change  his  cer- 
tificate, which  he  neglected  or  refused  to  do.     The  sole  question  be- 
fore the  court  for  determination  was  whether  the  amended  laws  of 
1889  of  the  society  and  the  statute  law  of  the  State  of  ^Maryland, 
adopted  in  1894,  of  which  State  the  society  was  a  citizen,  made  the 
designation' of  Emmons,   the   creditor,   void.      The   court   reviewed 
various  authorities,  and  concluded  its  opinion  with  the  following: 
"Inasmuch,  tlierefore,  as  Eubanks  named  ICmmons  as  beneficiary  in 
1887,  rightfullv  under  the  law  as  it  then  stood,  and  died  in  1905. 


84  FRATERNAL    SOCIETY    LAW 

without  having  chauged  such  beneficiary,  it  seems  but  fair  that 
upon  the  death  of  Eubanks,  Einmons  became  entitled  to  the  bene- 
ficial fund  as  neither  the  change  in  the  by-laws  of  the  order,  nor  of 
the  laws  of  the  State  of  Maryland  were  retroactive  in  efi'ect. " 

Emmons  vs.  Supreme  Conclave  Improved  Order  of  Heptasophs,  June, 
1906,  Superior  Court  of  Delaware;  63  Atl.  p.  871. 


THE   nit^rnrcT  of  roLT-yniA  «5 


THE 

DISTRICT  OF  COLUMBIA. 

CHAPTER  9. 

The  Congress  of  the  United  St;ites  has  enacted  for  the  District 
of  Columbia  an  elaborate  Insurance  Code  and  so  much  of  it  as  re- 
lates to  Fraternal  Benefit  Societies  follows : 

Defined. 

Section  749.  A  fraternal  beneficial  association  is  hereby  declared 
to  be  a  corporation,  .society,  order,  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  lienefit  of  its  members  and 
their  beneficiaries,  and  not  foi'  profit,  haviiii;-  a  Iodide  system  ^vith 
rit\ialistic  form  of  work  and  representative  form  of  government, 
making  provision  for  the  j)ayment  of  benefits  in  case  of  death.  Each 
such  association  may  make  provision  for  the  payment  of  benefits  in 
case  of  sickness,  temporary  or  permanent  physical  disability,  either 
as  a  result  of  disease,  accident,  or  old  age  :  Provided,  That  the  period 
in  life  at  which  physical  disability  benefits  on  account  of  old  age 
commences  shall  not  be  under  seventy  years,  or  the  age  of  ex- 
pectancy from  the  time  of  entering,  subject  to  their  compliance  with 
its  laws.  Any  such  association  may  create  and  maintain  a  reseiwe. 
emergency  or  benefit  fund  in  accordance  with  its  laws.  Any  such 
a.ssociation  having  a  reserve,  emergency  or  benefit  fund  may.  in 
addition  to  the  benefits  hereinbefore  named,  pay  withdrawal  benefits, 
not  exceeding  the  contributions  of  such  member,  to  a  member 
unal)le  or  unwilling  to  continue  membership,  provided  such  mem- 
bership shall  continue  not  less  than  three  successive  years.  Such 
association  may  also,  after  ten  years  oi  membershii).  apply  its  funds 
and  accumidations  as  its  laws  jirovide  or  the  association  and  mem- 
bers agree.     The  I'luul   fiMiii   which   the  ]iayments  of  such  benefits 


86  FRATERNAL    SOCIETY    LAW 

shall  be  made  aud  the  i'luul  frnm  which  the  expenses  of  such  asso- 
ciation shall  be  defrayed  shall  be  derived  from  assessments,  dues, 
and  other  payments  collected  from  its  members  or  otherwise.  Pay- 
ment of  death  benefits  shall  be  to  the  families,  heirs,  blood  relatives, 
affianced  husband  or  affianced  wife  of  or  to  persons  dependent  upon 
the  member.  Such  association  shall  be  governed  by  this  subchapter, 
aud  shall  be  exempt  from  the  provisions  of  insurance  laws  of  the 
United  States  relating  to  the  District  of  Columbia,  and  no  law  here- 
after passed  shall  apply  to  them  unless  they  be  expressly  designated 
therein  :  Provided,  however,  That  the  fact  that  anj'  such  association 
has  outstanding-  agreements  with  its  members  for  the  payment  of 
benefits  other  than  those  hereinbefore  specified,  if  it  is  making  no 
new  contracts  of  that  character  and  is  retiring  those  already  exist- 
ing, shall  not  exclude  such  association  from  the  operation  of  this 
subchapter. 

Existing  Associations. 

Section  750.  All  such  as.sociations  coming  within  the  description 
as  set  forth  in  section  seven  hundred  and  forty-nine  of  this  subchap- 
ter, organized  luider  the  laws  of  the  United  States  relating  to  said 
District,  or  of  any  State,  country,  province,  or  Territory,  and  now 
doing  business  in  said  District,  may  continue  such  business:  Pro- 
vided, That  they  hereafter  comply  with  the  provisions  of  this  sub- 
chapter regulating  annual  repoi-ts  and  the  designation  of  the  super- 
intendent of  insurance  of  said  District,  provided  for  in  subchajiter 
five  of  this  chapter,  as  the  person  upon  whom  i)i'ocess  may  be  served 
as  hereinafter  provided. 

Nonresident  Associations. 

Section  751.  Any  such  association  coming  within  the  dcscriijlion 
as  set  forth  in  section  seven  huiulred  and  forty-uin(>  of  this  sub- 
cha]iter,  organized  uiuicr  Ihc  laws  of  any  State,  country,  province, 
or  Territory,  and  not  now  doing  business  in  said  District,  shall  be 
admitted  to  do  business  within  said  Dis1i'i<-1.  when  it  shall  have  filed 
with  the  suiierintendent  of  insurance  a  duly  cci-tified  cojjy  of  its 
charter  and  articles  of  association  and  a  cojiy  of  its  by-laws,  certified 


THE    DISTRICT    OF    COLUMBIA  87 

to  by  its  secretary  or  corresponding  ol'licer,  toyctlirr  witli  nii  ;i|i|)(iii)t- 
iiient  of  the  said  superintendent  as  the  person  upon  whom  process 
may  be  served  as  hereinafter  provided :  Provided,  That  such  associa- 
tion shall  be  shown  to  be  anthoi'ized  1o  do  business  in  the  State, 
country,  province,  or  Territory'  in  wliicli  it  is  iiicoi'|)orated  or  organ- 
ized, in  case  the  l;i\vs  oi'  such  State,  country,  province,  of  'J'rrritor.v 
shall  provide  for  such  authorization;  and  in  case  the  laws  of  such 
State,  country,  province,  or  Territory  do  not  provide  for  any  formal 
authorization  to  do  business  on  the  part  of  an.y  such  association, 
then  such  association  shall  be  shown  to  be  conducting  its  business 
in  accordance  with  the  provisions  of  this  subchapter;  for  which 
purpose  the  said  sujterintendent  ma.v  personall.v,  or  b.v  some  person 
to  be  designated  by  him.  examine  into  the  condition,  atit'airs,  char- 
acter, and  busiiu'ss  methods,  accounts,  books,  and  investments  of 
such  association  at  its  honu^  office,  which  examination  shall  be  at 
the  ex|)ense  of  such  association  ami  shall  be  made  within  thirty  da.vs 
after  demand  therefor,  and  the  expense  of  such  examination  shall  be 
limited  to  fifty  dollars.  An.v  association  doing  business  under  this 
subchapter  shall  be  permitted  to  do  business  upon  filing  annuall.y 
with  the  superintendent  of  insurance  the  certificate  of  authority 
of  the  insurance  department  of  the  State,  jirovince.  (w  Territory  in 
which  it  is  incorporated  or  organized :  Provided,  however.  That  in 
case  of  failure  to  file  said  certificate  by  -diiy  such  association,  or  in 
case  the  stiperintendent  of  insurance  shall  deem  it  necessary,  he 
shall  have  power,  eitlier  personally  or  b.v  some  person  desigiuited 
by  him,  to  examine  into  the  condition,  aft'airs.  character,  business 
methods,  accounts,  books,  and  investments  of  such  association,  at 
its  home  office,  Mdiich  examination  shall  be  at  the  expense  of  the 
association.  The  amount  of  such  expense  shall  not  exceed  one  hun- 
dred dollars  for  associations  which  have  no  reserve  or  emergency 
fund  and  two  hundred  dollars  for  associations  with  a  reserve  or 
emergency  fund. 

Annual  Reports. 

Section  752.  Every  such  association  doing  business  in  said  Dis- 
trict shall,  on  OI-  before  the  first  day  of  March  of  each  ,vear,  make 
and  file  with  the  said  superintendent  a  rejiort  of  its  affairs  and  opera- 


yy  FRATERNAL    SOCIETY    LAW 

tidiis  during-  the  year  ending  on  the  thirt y-tirst  day  of  December 
immediately  preceding,  which  annual  report  shall  be  in  lieu  of  all 
otlier  reports  required  by  any  other  law.  Such  report  shall  be  upon 
l)lank  forms  to  be  provided  by  the  said  superintendent,  or  may  be 
pi-intc'd  in  iiaiiii)lilet  form,  and  shall  he  certified  under  oath  by  the 
duly  Muthoi-ized  officers  of  such  association,  and  shall  be  published, 
or  the  substance  thereof,  in  the  annual  report  of  said  superintendent 
under  a  separate  jiart  entitled  "Fraternal  Beneficial  Associations," 
and  shall  contain  ans\vi>rs  to  the  following  questions: 

First.  Number  of  cei'tificates  issued  dui'ing  tlie  >ear  oi-  members 
admitted. 

Second.     Amount  of  indenuiity  eft'ected  thereby. 

'I'hird.     Number  of  losses  or  benefit  liabilities  incurred. 

Fourtli.     Number  of  losses  or  benefit  liabilities  paid. 

Fifth.     'J'he  amii\uit  received  from  each  assessment  for  tlie  year. 

Sixth.  Tcital  amount  |)aid  members,  beneficiaries,  legal  repre- 
sentatives, or  heirs. 

Seventh.  Number  and  kind  of  claims  for  which  assessments  have 
been  made. 

Eightli.  Number  and  kind  of  claims  coni|)romised  or  resisted,  and 
brief  statement  of  reasons. 

Ninth.  Does  the  association  charge  annual  or  other  periodical 
dui's  or  admission  fees? 

Tenth.  If  so,  how  much  on  each  one  tlionsand  dollars,  annually 
or  per  capita,  as  the  case  may  be? 

Eleventh.  Total  amount  received,  from  what  source  .and  the  dis- 
position thereof. 

Twelfth.     Total  amount  of  salaries  paid  to  officers. 

Thirteenth.  Does  the  association  guarantee  in  its  certificates  fixed 
amounts  to  be  paid  regardless  of  amount  realized  from  assessments, 
dues,  admission  fees,  and  donations? 

Fourteenth.  If  so.  statr-  amount  uuai'anti'cd  and  the  security  of 
such  guaranty. 

Fifteenlh.     lias  the  association  a  reserve  oi'  emergency  fund? 

Sixteentli.  If  so,  how  is  it  created,  and  tor  what  purjxise.  the 
amoinit  Iher-eol'.  and  liow  invested'.' 

Seventeenth.      Has  llu'  association  more  than  one  class? 


THE    JJhSTh-If'T    OF    COIAMRIA  89 

Eighteenth.  If  so,  Ikiw  iiuiny;  ;ini|  llic  ainniinl  ol'  iiKlciiiiiity  in 
t^aeli  case. 

Xineteontli.     \innlici-  (iT  nu'inlxTS  in  cacli  class. 

Twentieth.     It  voluntary,  so  state;  and  give  date  of  ori;ani/.al  ion. 

Twenty-tirst.  If  organized  under  the  laws  of  said  District,  under 
wliat  law  and  at  wliat  time.  uivin<;-  cliajiter  and  year,  and  ija1e  of 
l)assage  of  tlie  act. 

Twent.y-second.  If  org;inized  under  the  laws  of  any  State,  coun- 
trv.  province,  or  Territory,  state  such  fact  and  the  date  of  organiza- 
tion, giving  chapter  and  year,  and  date  of  passage  of  the  act. 

Twenty-third.  Niiniber  of  certificates  of  beneficial  membershii) 
lapsed  during  the  year. 

Twent.v-fourth.  Nnmher  in  force  at  beginning  and  end  of  .vear; 
if  more  than  one  class,  innnl)er  in  each  class. 

Twenty-fifth.  Names  and  addresses  of  its  i)resident,  secretar\-. 
and  treasurer,  oi'  ('oiTes|)ondinii'  officers. 

Nonresident  Associations  to  Name  an  Attorney  in  the  District. 

Section  753.  Each  such  association  now  doing  or  hereafter  ad- 
mitted to  do  business  within  said  District,  and  iiot  having  its  prin- 
cipal office  within  said  District,  and  not  beinji'  oruiinzed  luuler  the 
laws  of  the  United  .States  relating  to  said  District,  .shall  appoint,  in 
writing,  the  said  superintendent  and  his  successors  in  office  to  be 
its  true  and  lawful  attorney,  upon  whom  all  lawful  process  in  any 
action  or  proceeding  against  it  ma.v  be  served,  and  in  such  writing 
shall  agree  that  anv  lawful  process  against  it  which  is  served 
on  said  attorne.v  shall  be  of  the  same  legal  force  and  validit.v  as  if 
served  upon  the  association,  and  that  the  authority  shall  continue 
in  force  so  long  as  an.v  liabilitv  remains  outstanding  in  said  District. 
Copies  of  said  certificate  certified  b.v  said  superintendent  shall  be 
deemed  sufficient  evidence  thereof,  and  shall  be  admitted  in  evidence 
with  the  same  force  and  effect  as  the  original  thereof  might  be 
admitted.  Service  upon  such  attorne.v  shall  be  deemed  sufficient 
service  upon  such  association.  When  legal  process  against  such 
association  is  served  upon  said  superintendent  he  shall  immediately 
notify  the  association  of  such  service  bv  letter,  prepaid  and  directed 
to  its  secretarv  or  corres)ionding  officer,  and  shall,  within  two  days 


90  FRATERNAL    SOCIETY    LAW 

after  such  service,  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him  to  such  officer.  The  plaintiff  in  such  process  so  served 
shall  pay  to  the  said  superintendent  at  the  time  of  such  service  a  fee 
of  three  dollars,  which  shall  be  recovered  by  him  as  a  part  of  the 
taxable  cost  if  lie  prevails  in  his  suit.  The  said  sujjerintendent  shall 
keep  a  record  of  all  iirocesses  served  up<ui  him,  wliich  record  shall 
show  the  day  and  hour  when  such  service  was  made. 

Permit  from  Superintendent  of  Insurance. 

Section  754.  The  said  superintendent  shall,  upon  the  apjtlieation 
of  any  association  having-  the  right  to  do  business  within  said  Dis- 
trict, as  ]u-ovided  by  this  subchapter,  is-sue  to  such  association  a 
permit  in  writing  authorizing  such  association  to  do  business  within 
said  District,  for  which  certificate  and  all  proceedings  in  connection 
therewith  such  association  shall  pay  the  said  superintendent  the  fee 
of  five  dollars. 

Certificate  of  Organization — Trustees. 

Section  7.35.  Any  nine  or  more  persons,  at  least  one-third  of 
whom  shall  be  residents  of  the  District  of  Columbia,  being  desirous 
of  forming  a  fraternal  beneficial  association  for  the  purposes  set 
forth  in  section  seven  hundred  and  forty-nine  of  this  subchapter, 
may  associate  themselves  together  and  effect  such  organization  as 
hereinafter  prescribed,  and  not  otherwise.  Such  persons  shall  make, 
sign,  and  acknowledge  before  any  officer  authorized  to  take  the 
acknowledgment  of  deeds  in  this  District  and  file  in  the  office  of 
the  recorder  of  deeds  of  said  District  a  certificate  or  declaration  in 
writing,  to  be  recorded  in  a  book  kept  for  that  purpose  and  open 
to  ))Hblic  inspection,  in  which  shall  be  stated  the  nanu='  or  title  by 
which  said  association  shall  be  known  to  law;  the  mode  anil  manner 
in  which  the  em-poratc  powers  granted  by  this  subchapter  are  to  be 
exercised:  the  name  or  official  title  of  the  officers,  trustees,  repre- 
sentatives, or  other  persons  by  whatever  name  oi'  title  designated, 
who  are  to  have  and  exercise  the  general  control  aiul  management 
of  its  affairs:  the  place  of  doing  business  ih'fiued  :  the  limit  as  to  age 
of  ap|ilicMiits  I'or  liriii'tiri:il  inriiibrrship.  wliicli  sli;ill   not  rxcccd  fift\'- 


THE    DISTHIVT    OF    COIAMHIA  91 

live  yi-ai's,  ;iii(l  1li;i1   nicdicjil  i'x:iiiiiii;it  iims  iU'i-  i-niniri'd  nl'  .•ippliciints 

for  life  heiii'tils,  togctlicr  with  the  sworn  stateiiiciit  by  llii' I'  saiil 

corporators  that  at  least  one  hundi'ed  jiersons  elifiihle  under  the 
j)ropose(l  laws  ol'  sneii  assoeialion  lo  nicii;liei'siii|i  tlier-rin  have  in 
good  faith  made  application  in  writing  for  membership.  The  re- 
corder of  deeds,  upon  the  filing  of  said  declaration,  shall  deliver  to 
such  association  a  certified  copy  of  the  papers  so  tiled  and  recorded 
in  his  office,  togelher  with  a  certificate  to  siieli  association,  stating 
that  the  provisions  of  thi.s  subchaptei'  relative  to  incorporation  have 
been  complied  with  and  that  said  association  beconies  thereby 
aii1  hiiri/.ed  lo  carry  cm  tin-  work  (if  a  rralcrnal  bcnclirial  association. 
Ui>on  tilint;'  the  certificate  or  declaration  as  afor-csaid,  the  pei-soiis  who 
sliall  have  signed  and  acluiowU'dged  tlie  same,  and  their  successors 
and  associates,  shall,  by  the  |)i'ovisions  of  this  snbcha]itei'.  be  a  body 
politic  and  ccir']iorate  by  the  name  and  style  stilted  in  the  certitieate. 
and  by  that  name  and  style  shall  \\:\\r  pei-petual  succession,  and  by 
saiil  name  may  sue  and  be  sued,  and  may  have  and  use  a  common 
seal,  and  the  same  may  alter  and  change  at  ])leasure,  and  may  make 
and  alter,  at  times  or  from  time  to  time,  such  laws,  not  inconsistent 
with  the  Constitution  of  the  United  States  or  the  laws  in  force  in 
said  District,  as  they  may  deem  necessarj-  for  the  government  of 
said  association.  And  they  and  their  successors,  by  their  corporate 
name,  shall  in  law  be  cai)able  of  creating,  maintaining,  and  dis- 
bursing a  reserve  or  emergency  fund  in  accordance  with  its  laws  and 
the  ])rovisions  of  this  subchapter,  and  of  taking,  receiving,  ])urehas- 
ing.  and  liolding  real  and  personal  estate  necessary  for  the  purpose 
of  such  association,  and  may  let,  place  out  at  interest,  or  sell  and 
convey  the  same  as  may  seem  most  beneficial  for  said  association. 
The  association  shall  elect  from  its  members  trustees,  directors,  or 
managers,  by  whatever  title  known  in  its  laws,  at  such  time  and 
place  and  in  such  manner  as  may  be  specified  in  its  laws,  who  shall 
have  the  control  and  management  of  the  affairs  and  funds  of  said 
association,  a  ma.i'ority  of  whom  shall  be  a  .quorum  for  the  trans- 
action, of  business:  and  whenever  any  vacancy  shall  happen  among 
such  trustees,  directors,  or  managers,  by  death.  I'esignation.  or  other- 
M-ise.  s\ich  vacancy  shall  be  filled  in  such  manner  as  shall  be  ])ro- 
vided  b\-  the  laws  of  said  associiition. 


92  FRATERNAL    SOCIETY    LAW 

Reinccrporation. 

Section  7.56.  The  officers,  trustees,  direetors.  or  s^overniug  body 
of  any  existing-  fraternal  beneficial  association  may,  by  conforming- 
to  the  requirements  of  the  several  provisions  of  this  subchapter,  rein- 
corporate themselves  or  continue  their  -  existing  corporate  po-wers 
under  this  subchapter,  or  change  their  name,  stating  in  their  certifi- 
cate the  original  name  of  such  corporation  as  well  as  their  new  name 
assumed,  and  all  the  property  and  effects  of  such  existing  corpora- 
tion shall  vest  in  and  belong  to  the  corjioration  so  reincorporated  or 
continued. 

Subordinate  Bodies. 

Section  757.  Any  subordinate  body  of  any  fraternal  beneficial 
association  incorporated  under  the  provisions  of  this  subchapter,  or 
of  such  association  now  doing  business  or  which  may  hereafter  be 
admitted  to  do  business  in  this  District  under  this  subchapter,  where 
1li('  laws  of  the  governing  l)ody  of  said  association  do  not  prohibit 
lhi>  incorporation  of  their  subordinate  bodies,  may  become  a  bod.v 
corporate  in  the  manner  following:  At  some  I'egular  meeting  of  such 
suliordinate  body  a  resolution  expressing  the  desire  of  such  sub- 
ordinate body  to  be  incorporated,  and  directing  its  officers  to  perfect 
such  incorporation,  shall  l)e  submitted  to  a  vote  of  the  members 
present,  and  if  two-thirds  of  the  mcjubers  present  vote  therefor 
the  president  and  secretary  of  such  subordinate  body,  or  the  officers 
holding  relative  offices  thei-ein.  shall  prepare  articles  of  association, 
luider  their  hands  and  the  seal  of  such  subordinate  body,  setting 
forth,  first,  the  mimber  of  members  of  such  subordinate  body  then 
in  good  standing;  secoiul,  the  name  by  which  said  subordinate  body 
is  i<no\vn  :  thii'd,  the  date  of  its  organization  and  the  iieriod  for  which 
it  is  to  be  incorporated,  not  exceeding  thirty  years.  .\  fupy  of  such 
articles  of  association  shall  ho  filed  with  the  i-oeoi-der  of  deinls.  and 
shall  by  him  lie  rccdrdcd,  Idgethcr  witli  the  at'lidavit  hereafter 
named,  in  a  buok  to  be  K'epl  Wiy  Ihal  pui-pnse.  ()n  the  executinn  of 
said  ai'tieies  of  association  and  liefore  tiu"  liliiig  tliereof  with  the 
recorder  the  secretary  of  sueli  subordinate  l)ody  shall  annex  thereto 
his  affidavit,  staling  Unit  he  is  a  memlier  in  good  slanding  in  such 
subcirdinalr  lioily  and  occn|)ies  the  pusilidn  ol' secretary,  or  the  office 


THI'J    DISTRICT    OF    COLUMBIA  93 

correspond  ill  <;■  tlicrcwilli.  jiihI  that  llic  rcsdlnt  imi,  a  copy  (if  which 
shall  be  set  I'drth  at  Iciiiilh.  was  regulai'ly  jiassed  at  a  reii'ular  meet- 
ing of  said  siil)()i'(liiiat('  body  and  received  the  vote  of  two-thii'ds  of 
the  meiiiliers  present  and  voting,  and  tiiat.  to  the  best  of  his  knowl- 
edge and  Ix'lief.  the  statements  made  in  the  articles  of  association 
are  true,  and  that  such  siiboi'dinate  bod,y  is  organized  and  acting 
under  the  laws  of  its  respective  association,  giving  the  name  l)y 
which  such  association  is  known.  "When  the  foregoing  re(iiiirements 
are  complied  with  such  subordinate  body  shall  be  a  body  corporate 
ty  the  name  expressed  in  such  articles,  and  by  that  name  shall  be 
a  person  in  law,  capable  of  suing  and  being  sued  in  the  courts,  and 
taking  aiul  holding  jirojierty  of  every  kind  the  same  as  natural 
persons,  and  a  copy  of  said  articles  of  association,  duly  certified  to 
by  the  recoi'der  of  deeds,  shall  be  prima  facie  evidence  in  all  courts 
and  places  of  the  existence  and  the  due  incorporation  of  such  sub- 
ordinate body. 

Contract  Invalid  if  Beneficiary  to  Pay  Assessments. 

Section  758.  No  contract  with  any  such  association  shall  be  valid 
when  there  is  a  contract,  agreement,  or  imder.standing  betw^een  the 
member  and  the  beneficiary  prior  to  or  at  the  time  of  becoming  a 
member  of  the  association  that  the  beneficiary,  or  any  person  for 
him,  shall  pay  such  member's  assessments  and  dues,  or  either  of 
them. 

Benefits  Exempt  From  Attachment. 

Section  759.  The  money  or  other  benefit,  charity,  relief,  or  aid 
to  be  paid,  provided,  or  rendered  by  any  association  authorized  to  do 
"business  under  this  subchapter  shall  not  be  liable  to  attachment, 
garnishment,  or  other  process,  and  shall  not  be  seized,  taken,  appro- 
priated, or  ai)plied  liy  any  legal  or  equitable  i)rocess,  or  by  operation 
of  law  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any 
beneficiary  named  in  a  certificate,  or  any  jierson  who  may  have  any 
right  thereunder. 

Meetings. 

Section  760.     Any  such  association  organized  imder  the  laws  of 


94  FRATERNAL    SOCIETY    LAW 

said  District  iiuiy  provide  for  the  meetings  of  its  legislative  or 
governing  body  in  any  .State,  country,  province,  or  Territory  wherein 
such  association  shall  have  subordinate  bodies,  and  all  business  trans- 
acted at  such  meetings  shall  be  valid  in  all  respects  as  if  such  meet- 
ings were  held  within  said  District ;  and  where  the  laws  of  any  such 
association  provide  for  the  election  of  its  offieers  by  votes  to  be  cast 
in  its  subordinate  bodies,  the  votes  so  cast  in  its  subordinate  bodies 
in  any  State,  country,  province,  or  Territor\'  shall  be  valid  as  if  cast 
Avithin  said  District. 

Fraudulent  Representations. 

Section  761.  Any  person,  officer,  nionber,  or  examining  physician 
who  shall  knowingly  oi-  willfully  make  any  false  or  fraudulent  state- 
ment or  representMtion  in  ov  with  reference  to  any  application  for 
membership  or  for  restoration  to  membership  or  for  the  purpose  of 
obtaining  any  money  or  benefit  in  any  association  transacting  busi- 
ness under  this  subchapter  slmll  be  guilty  of  a  misdemeanor,  and 
upon  conviction  shall  be  ]uniished  by  a  tine  of  not  less  than  one 
hundred  dollars  nor  more  than  five  hundred  dollars,  or  imprisonment 
in  the  United  States  .iail  in  said  District  for  not  less  than  thirty  days 
nor  more  than  one  year,  or  both,  in  the  discretion  of  the  court;  and 
an.\-  )ierson  who  shall  willfully  make  a  false  statement  of  any 
material  fact  or  thing  in  a  sworn  statement  as  to  the  death  or  dis- 
ability of  a  certificate  holdei-  in  any  such  association  for  the  purpose 
of  procuring  payment  of  a  benefit  named  in  the  certificate  of  such 
holder,  and  an.\-  ])erson  who  shall  willfully  nudce  any  false  statement 
in  any  verified  re|)oi-t  or  declaration  under  oatii  re(|uii'ed  or  author- 
ixed  li\-  tliis  subcliaptei',  shall  lie  guilty  of  perjury. 

Neglect  to  Report. 

Section  Tfi'J.  Any  such  association  refusing  or  negk'cting  to  make 
the  report  as  pi'ovided  in  this  subchapter  shall  be  excluded  from 
doing  busiru'ss  within  said  dislriet.  Said  snpei'intendent  of  insur- 
ance musi,  within  si.xty  ilays  after  failure  to  make  such  report,  or 
in  case  an\-  such  as.sociation  shall  exceed  its  powers,  or  shall  coiuluct 
its  business  fraudulently,   or  shall   fail   to  comply  with  any   of  the 


THE    DISTRICT    OF    COLUMBIA  95 

provisions  ol:'  lliis  suhrliiiplci',  li'ivc  notice  in  writiui;-  to  tiic  atlorncv 
for  said  District,  who  sluill  immediately  eonimence  an  aution  ag^ainst 
such  association  to  enjoin  tlie  same  from  carrying  on  any  business. 
An  injunction  against  any  such  association  may  be  granted  on  appli- 
cation by  the  Commissioners  of  said  District  at  the  request  of  the 
said  superintendent.  No  association  so  enjoined  shall  have  authori1.\- 
to  continue  business  until  such  rei)ort  shall  be  made,  or  overt  act 
or  violation  complained  of  shall  have  been  corrected,  nor  until  the 
costs  of  such  action  be  paid  by  it,  (provided,  tlie  court  shall  find 
that  such  association  was  in  default,  as  charged,)  whereupon  the 
superintendent  of  insurance  shall  reinstate  such  association,  and  not 
until  then  shall  such  ;issoeiati<in  be  allowed  again  to  do  busiiU'ss  in 
said  District.  Any  officer,  agent,  or  person  acting  for  any  association 
or  subordinate  body  thereof,  within  said  district,  while  such  associa- 
tion shall  be  so  enjoined  or  prohibited  from  doing  business  pursuant 
to  this  subchapter,  shall  be  deemed  guilty  of  a  misdemeanor,  and  on 
conviction  thereof  shall  be  lumished  by  a  fine  of  not  less  than  twenty- 
five  dollars  nor  more  than  two  hundred  dollars,  or  by  imprisonment 
in  saiti  jail  not  less  than  thirty  days  nor  more  than  one  year,  or  by 
both  such  fine  and  imprisonment,  in  the  discretion  of  the  court. 

Acting-  Without  Authority. 

Section  768.  Any  person  who  shall  act  within  said  District  as  an 
officer,  agent,  or  otherwise,  for  any  association  which  shall  have 
failed,  neglected,  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provision.s  of  this  subchapter,  or  shall  have  failed  or  neg- 
lected to  procure  from  the  said  superintendent  a  proper  certificate  of 
authority  to  transact  business  as  provided  for  in  this  subchapter, 
shall  be  subject  to  the  ]ienalty  provided  in  the  last  preceding  section 
for  the  misdemeanor  therein  specified.  To  "transact  business"  or 
"doing  business'"  under  this  subchapter  means  the  writing  of  appli- 
cations aiul  the  soliciting  of  new  members  so  far  as  the  penalty  of  this 
subchapter  applies  thereto.  It  shall  not  be  unlawful  for  any  organ- 
ization under  section  seven  hundred  and  forty-nine  to  continue  the 
operation  of  its  lodges  or  branches  except  in  securing  new  members. 


96  FRATEHXAL    SOCIETY    LAW 

This  Law  Not  to  Apply  to  Associations  for  Profit. 

Section  764.  Nothing  in  this  subchapter  shall  be  construed  to 
apply  to  any  corporation,  society,  order,  or  association  carrying-  on 
the  busines.s  of  life,  health,  casualty,  or  accident  insurance  for  profit 
or  gain,  and  it  shall  only  apply  to  fraternal  beneficial  associations  as 
defined  by  section  seven  hundred  and  forty-nine,  and  nothing  in 
this  subchapter  ccnitained  shall  be  construed  to  eft'ect  any  grand  or 
subordinate  lodge  or  branch  of  any  such  fraternal  beneficial  societies, 
orders,  or  associations  which  limits  its  certificate  holders  to  a  par- 
ticular religious  denomination  or  to  the  employees  of  a  particular 
town  or  city,  designated  firm,  business  house,  or  corporation,  or  de- 
partment or  branch  of  the  United  States  Government,  nor  the  grand 
and  subordiniite  lodges  of  the  Independent  Order  of  Odd  Fellows, 
nor  any  grand  or  subordinate  lodge,  or  other  l)ody  of  Free  and  Ac- 
cepted ]Masons.  nor  the  grand  or  any  subordinate  lodge  of  the 
Elnights  of  Pythias,  or  similar  orders,  associations,  or  societies  that 
do  not  have  as  their  principal  object  the  issuance  of  benefit  certifi- 
cates of  membership  in  case  of  death  or  the  payment  of  sick,  funeral, 
or  death  benefits  exceeding  in  amount  one  hundred  dollars. 

Nor  to  Associations  or  Individuals  Using  Name  of  Previously  Exist- 
ing Corporation. 

Section  Tlio.  The  provisions  of  this  subchapter  shall  not  extend 
to  nor  apply  to  any  association  or  individual  who  shall,  in  the  cer- 
tificate filed  with  the  recorder  of  deeds,  use  or  specify  a  name  or 
style  the  same  as  that  of  any  previously  existing  incorporated  fra- 
ternn]  l)oneficial  association  in  the  District  of  Columbia. 

Sec.  0()1.  Cliap.  '_']  of  the  Disti'ict  of  Columbia  Code  provides: 

Party  Committing  Murder  or  Manslaughter  Takes  No  Interest  in 
Estate  of  Deceased. 

Section  !)(i1.  \<i  imtsoii  wiio  shall  be  convicted  i)\'  the  I'donious 
homicide  of  ;iiici1lier.  eitlier  by  way  of  murder  or  manslaughter,  shall 
take  any  estate  or  interest  of  any  kind  whatsoever  in  any  kind  of 
lii-o]i('i-ty  whatsoever  from  lliat  nthci'  by  way  of  inhcrilani-c.  disti'ibu- 


THE    DISTRICT    OF    COLUMBIA  97 

tion,  devise,  or  bequest,  or  shall  take  any  remainder,  reversion,  or 
executoi'y  interest  dejjendent  upon  the  death  of  that  other;  and  the 
estate  or  interest  of  property  to  which  the  person  so  convicted  would 
have  succeeded  or  would  have  taken  in  any  way  from  or  after  the 
death  of  the  person  so  killed  by  him  sliall  go  as  if  the  person  so  con- 
victed had  died  before  the  i)erson  whom  ho  shall  be  convicted  of  kill- 
ing. And  every  policy  of  insurance  procured,  directly  or  indirectly, 
by  the  person  so  convicted  for  his  own  benefit  or  payable  to  him  upon 
the  life  of  the  person  so  killed  shall  be  void.  This  act  shall  not  affect 
the  rights  of  bona  lide  purchasers  of  any  such  property  for  value 
without  notice. 

By-laws  are  Prospective  in  Operation. 

By-laws  will  be  given  a  prospective  operation  only,  unless  the 
language  used  clearly  indicates  that  they  were  intended  to  be  ret- 
rospective in  their  operation,  especially  where  to  give  them  a  reti-o- 
spective  effect  will  impair  the  contract. 

Brown   vs.   Grand    Fountain   of   the   Uniterl    Order   of  True   Reform- 
ers, Nov.  9th,  1906.  2S  App.  Cases  D.  C.  200. 

Amendment  of  Charter — Rights  of  Members  Unaffected. 

An  amendment  to  the  charter  of  a  society,  which  was  originally 
incorporated  as  a  joint  stock  company,  depriving  certificate  holders 
of  the  right  they  formerly  possessed  of  designating  their  bene- 
ficiaries, will  not  affect  existing  members  in  the  absence  of  anything 
in  the  amendment  of  the  charter  to  show  that  it  was  intended  to 
have  a  retrospective  effect,  and  where  the  existing  certificate  holders 
did  nothing  to  show  an  intention  to  acquiesce  in  such  amendment. 

Brown  vs.  Grand   Fountain   of  the   United   Order   of  True  Reform- 
ers, Nov.  9th,  1906,  28  App.  Cases  D.  C.  200. 

Amendments  to  Constitution. 

A  committee  appointed  by  a  society  to  revise  the  constitution  and 
general  laws  has  no  authorit.y  to  propose  amendments  without  the 
notice  required  for  amendments. 


98  FRATERNAL    SOCIETY   LAW 

National  Council  J.  O.  U.  A.  M.   vs.  State  Council  J.  O.  U.  A.   M., 
Feb.  6,  1906,  27  App.  Cases  D.  C.  1. 

Void  Constitution. 

A  revised  constitution  of  a  society,  adopted  without  compliance 
with  the  requirements  of  the  old  constitution  as  to  the  procedure  in 
such  cases  is  invalid,  and  a  bill  in  equity  by  the  National  council 
against  the  State  council  to  compel  the  surrender  of  its  charter,  and 
to  iujoiu  it  from  acting  thereunder,  on  the  ground  that  the  charter 
had  been  revoked  by  the  National  council's  authority,  will  not  lie 
where  the  National  council  so  revoking  the  charter  was  created, 
by  the  revised  constitution  so  unlawfully  adopted. 

National  Council   J.  O.  U.  A.  M.   vs.  State  Council  J.   O.  U.  A.   M., 
Feb.  6,  1906,  27  App.  Cases  D.  C.  1. 

Reinstatement  a  Personal  Privilege. 

Where  the  by-laws  of  a  society  provide  that  forfeiture  and  dis- 
connection of  a  member  will  result  from  the  non-payment  of  the 
assessments,  and  also  that  the  disconnected  member  may  be  rein- 
stated by  payment  b.v  him.  within  30  days,  of  his  arrearages,  the 
right  of  reinstatement  is  held  to  be  personal  to  the  member,  and 
not  to  survive  to  his  personal  representatives  or  beneficiaries,  and 
if  the  member  dies,  and  is  disconnected  inside  of  such  30  days,  there 
can  be  no  recovery  on  the  benefit  certificate. 

Supreme  Commandery  of  the  United  Order  of  the  Golden  Cross  vs. 
Bernard,  Nov.  8th,  1905,  26  App.  Cases  D.  C.  169. 

Agency  of  Local  OiRcers — Estoppel. 

As  to  the  agency  of  a  local  collecting  ofSeer.  and  his  right  to  waive 
laws,  and  a  discussion  of  the  question  of  estoppel,  as  apply  in  such 
cases,  see 

Supreme  Commandery  of  the  United  Order  of  the  Golden  Cross  vs. 
Bernard,  Nov.  8th,  1905,  26  App.  Cases  D.  C.  169. 


THE    DISTRICT    OF    COLUMBIA  99 

Agency  of  Local  Officials. 

Where  a  by-law  of  a  society  imposes  upon  the  officers,  of 'local 
councils  the  duty  of  receiving  and  transmitting  to  the  central*  gov- 
erning body  the  dues  and  assessments  of  members;  a' provision  in 
such  by-law  that  the  officers  of  each  local  counm  shall  be  deemed 
the  agents  solely  of  such  council,  is  inconsistent  with  the  duty  o{ 
the  agency,  and  cannot  be  used  to  defeat  a  cla'm  upon  a  certificate 
issued  by  the  society.  In  such  ease  it  is  imih'a:*;erial  u"^  between  the 
member  and  the  society  whether  the  latter 's  agents  and  officers  of  the 
local  council  perform  their  duty  or  not  by  transmitting  the  assess- 
ments which  the  member  had  paid. 

Prudent  Patricians  of  Pompeii  vs.   Marr,  June  23rd,  1902,   20  App. 
Cases  D.   C.   363. 

Good  Standing — Resort  to  Civil  Courts. 

The  courts  will  not  interfere  to  determine  a  person's  good  standing 
in  his  society,  when  such  good  standing  is  based  upon  morals,  re- 
ligion, etc.,  but  will  interfere  whenever  such  good  standing  is  based 
upon  the  payment  of  dues,  etc. 

Prudent  Patricians  of  Pompeii  vs.   Marr,   June  23rd,   1902,   20  App. 
Cases  D.   C.   363. 

Suicide — Facts  Held  Not  Sufficient. 

For  the  facts  in  a  suicide  case,  where  the  court  directed  a  verdict 
for  the  plaintiff,  and  no  important  question  of  law  being  involved, 
see  the  following: 

National  Union   vs.  Bennett,  Nov.  lltli,  1902,   20  App.   Cases   D.   C. 
527. 

Jurisdiction  of  Courts  Over  Foreign  Society. 

A  suit  in  equit}'  to  enjoin  a  foreign  mutual  insurance  society,  whose 
dues  or  assessments  are  payable  at  its  home  office,  and  which  has  an 
agency  and  carries  on  business  in  this  district,  against  collecting 
from   a    member   resisting,    excessive   and   illegal   assessments,    and 


100  FRATERNAL    SOCIETY    LAW 

against  forfeiting  his  contract  for  non-payment  of  such  assessments, 
and  also  seeking  an  accounting  and  discovery  of  the  books  and 

■  papers' of  the  corporation,  to  determine  the  member's  basis  of  assess- 
ment, is  .pot  maintainable  in  this  jurisdiction,  as  the  relief  sought 
would  require  the  direction  and  control  of  the  internal  affairs  of 

'the  corporation^  H'tieh  pi'operly  belong  to  the  jurisdiction  where 

•"t^^'.corporation  is  d:6miciled. 

Caaf-k','iii53.  Mutual 'Reserve  Fund  Life  Ass'n,  Feb.  7th,  1899,  14  App. 
dases  D./C.  iS4 . 

Members  Bound  By  Laws — Ignorance  Inexcusable. 

The  members  of  a  mutual  insurance  society  are  bound  bj^  its  con- 
stitution and  by-laws,  whether  they  have  actual  knowledge  of  them, 
or  whether  they  are  referred  to  in  the  certificate  held  by  them  or  not. 

Clark  vs.  Mutual  Reserve  Fund  Life  Ass'n,  Feb.  Tth,  1899,  14  App. 
Cases  D.  C.  154. 

Suicide — Sane  or  Insane. 

A  stipulation  in  a  cei'tificate  relieving  the  society  of  liability,  ex- 
cept for  assessments  paid,  in  case  of  the  suicide  of  a  member,  whether 
voluntary  or  involuntaiy,  sane  or  insane,  is  valid,  and  will  be  given 
effect  according  to  the  terms  of  the  contract.  In  a  suit  on  a  cer- 
tificate containing  such  a  stipulation,  where  the  defense  is  estab- 
lished, and  the  evidence  is  so  clear  as  to  exclude  any  other  hypothe- 
sis, other  than  by  suicide,  doubtful  presumption  against  the  fact  of 
suicide  will  not  bo  allowed  to  counteract  and  divert  the  rational  con- 
elusion  deducible  from  such  clear  and  definite  proof.  In  such  case 
it  seems  proper  for  the  trial  court  to  direct  a  verdict  for  the  suicide. 

Sommerville  vs.  Knights  Templars,  Nov.  4th.  1897,  11  App.  Cases  D. 
C.  417. 

Forfeiture — No  Reinstatement  of  Contract  after  the  Member 's  Death. 

The  constitution  and  by-laws  of  a  mutual  benefit  association  and 
the  certificate  of  membership  in  which  the  party  to  whom  it  is  issued 
agrees  to  conform  to  the  constitution  and  by-laws,  constitute  the  con- 


THE    DISTRICT    OF    COLUMBIA  101 

tract,  and  determine  the  rights  of  the  member,  and  where  such  con- 
tract provides  that  any  member  who  fails  to  pay  any  of  his  assess- 
ments 30  days  after  the  same  may  be  due  shall  be  notified,  and  if 
he  shall  be  in  arrears  30  days  longer  he  shall  be  dropped,  it  is  of  the 
essence  of  the  contract.  And  upon  his  failure  in  such  case  to  pay 
after  notice,  his  rights  terminate,  and  the  subsequent  tender  by  the 
beneficiary  after  the  member's  death  of  the  amount  of  the  assess- 
ment cannot  avail  to  reinstate  the  membership. 

Drum  vs.  Benton,  Oct.  3,  1898,  13  App.  Cases  D.  C.  245. 


102  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  FLORIDA. 

-  CHAPTER  10. 

There  is  no  statute  law  in  the  State  of  Florida  relating  to 
Fraternal  Benefit  societies  and  the  Supreme  Court  of  that  State 
has  had  fewer  questions  of  Fraternal  Society  LaAv  to  adjudicate  than 
most  of  the  States. 

Death  in  Violation  of  Criminal  Law. 

In  an  action  ujjon  a  certificate  where  one  of  the  defendant's  pleas 
is  to  the  effect  that  the  member  came  to  his  death  in  consequence  of 
the  violation  by  him  of  the  criminal  law  of  the  State  of  Florida,  the 
burden  of  proving  the  matter  contained  in  the  plea  is  upon  the  de- 
fendant, and  it  must  establish  the  plea  by  a  preponderance  of  the 
testimony.  For  the  facts  in  a  case  supporting  the  plea,  see  the 
court's  opinion. 

Supreme    Lodge   Knights   of   Pythias   vs.   Lipscomb,    June,    1905,   50 
Florida  406. 

Waiver  of  Proofs  of  Loss. 

A  denial  of  liability  i.s  a  waiver  of  proofs  of  loss. 

Ta.vlor  vs.  Glenn  Falls  Ins.  Co.,  .lanuar.v,  1902,  44  Fla.  273. 


THE    STATE    OB'    GEORGIA  103 


THE 

STATE  OF  GEORGIA. 

CHAPTER  11. 

An  Act  to  define  and  regulate  fraternal  beneficiary  orders,  associa- 
tions or  societies  in  the  State  of  Georgia,  to  provide  penalties,  and 
for  other  purposes. 

Section  1.  Be  it  enacted  by  the  General  Assembly  of  Georgia, 
That  a  fraternal  beneficiary  order,  association  or  society  is  hereby 
defined  to  be  a  corporation,  society  or  voluntary  association  which 
has  no  capital  stock,  but  is  formed  or  organized  and  carried  on  for 
the  benefit  nf  its  members  and  their  beneficiaries,  and  having  a. 
representative  form  of  government  and  a  lodge  system,  with  ritual- 
istic form  of  work  for  the  meeting  of  its  lodges,  chapters,  councils, 
or  other  designated  subordinate  bodies,  and  the  benefits,  insurance, 
charity  or  relief  shall  be  payable  by  a  grand  or  supreme  body  of 
the  same,  excepting  sick  benefits,  which  may  also  be  paid  by  local 
or  subordinate  bodies.  Such  grand  or  supreme  bodies  may  be  com- 
posed of  its  officers,  incorporators,  representatives  elected  by  local, 
district  or  grand  bodies,  past  officers  and  standing  committees.  Such 
orders  or  associations  may  make  a  constitution,  by-laws,  rules  and 
regulations  consistent  with  the  existing  laws  of  the  State,  for  thf> 
government  of  all  under  its  authority,  for  the  management  of  its 
properties  and  the  due  and  orderly  conduct  of  its  affairs. 

Such  orders  or  associations  may  make  provision  for  the  payment 
of  benefits  in  case  of  death,  sickness,  temporary  or  permanent  physi- 
cal disability,  either  as  the  result  of  disease,  accident  or  old  age; 
provided,  the  period  of  life  at  which  payment  for  old  age  com- 
mences shall  not  be  under  seventy  years.  Any  such  order  or  associa- 
tion may  also  accumulate,  maintain,  apply  or  disburse  among  its 
membership  a  reserve,  emergency  or  other  funds,  as  may  be  pro- 


104  FRATERNAL    SOCIETY    LAW 

vided  iu  its  constitution  and  laws;  provided,  however,  that  no  profit 
or  o-ain  shall  be  added  to  the  payments  made  by  a  member. 

The  funds  from  which  the  payment  of  benefits  shall  be  made,  and 
the  funds  from  which  the  expenses  shall  be  defrayed,  shall  be 
derived  from  assessments,  dues  or  other  payments  collected  from  its 
members,  as  may  be  provided  by  the  constitution  or  by-laws  of  such 
order  or  association.  Payment  of  death  benefits  shall  be  to  families, 
heirs,  blood  relatives,  affianced  husband  or  affianced  wife  of,  or  to 
Ijersons  dependent  ujion  the  member,  as  may  be  designated  by  the 
member. 

Such  orders  or  associations  shall  be  governed  by  this  Act,  and 
shall  be  exempt  from  the  provisions  of  the  insurance  laws  of  this 
State,  and  no  law  hereafter  passed  shall  apply  to  fraternal  benefi- 
ciary orders  or  associations,  unless  it  is  expressly  designated  therein. 

Section  2.  Be  it  further  enacted.  That  any  fraternal  beneficiary 
order,  association  or  society  of  this  or  any  other  State,  district, 
province  or  territory,  now  having  members,  or  any  lodge,  chapter, 
council  or  subordinate  branch  duly  established  and  organized  in 
this  State,  may  continue  its  operations  and  business  in  this  State ; 
provided,  that  it  hereafter  complies  with  the  provisions  of  this  Act 
regulating  annual  reports,  and  the  designation  of  the  Insurance 
Commissioner  as  the  person  upon  whom  process  may  be  served,  as 
hereinafter  provided. 

Section  3.  Any  fraternal  beneficiary  order,  association  or  societj^ 
coming  within  tlie  description  as  set  forth  in  section  one  of  this 
Act,  organized  under  the  laws  of  any  other  State,  province,  district 
or  territory,  not  now  having  lodges,  covmcils,  or  other  bodies,  or 
members  in  this  State,  shall  be  permitted  to  do  business  within  this 
State  when  it  shall  have  filed  with  the  Insurance  Commissioner  a 
certificate  from  the  official  in  charge  of  insurance  matters  in  its 
home  State  of  incorporation  that  it  is  authorized  to  transact  business 
therein  as  a  fraternal  beneficiary  order  or  association,  also  a  duly 
certified  copy  of  its  charter  and  articles  of  association,  and  a  copy  of 
its  constitution  and  laws,  certified  to  by  its  secretary  or  correspond- 
ing ofiieer.  together  with  the  appointment  of  the  Insurance  Com- 
missioner as  the  person  upon  whom  Ic^al  process  may  be  served,  as 
hereinafter  ]>rovided. 

Section  -1.    Every  such  corporation,  society,  order  or  association 


THE    STATE    OF    GEORGIA  105 

doing  business  iu  this  State  shall,  on  or  bei'ore  the  first  day  of 
March  each  year,  make,  and  file  with  the  Insurance  Commissioner 
a  report  of  its  affairs  and  operations  during-  the  year  ending  the 
thirty-first  day  of  December  immediatelj^  preceding,  which  annual 
report  sliall  be  in  lieu  of  all  other  reports  required  by  any  other 
law.  Such  reports  shall  be  made  on  blanks  provided  by  the  Insur- 
ance Commissioner,  and  shall  be  verified  under  oath  by  the  duly 
authorized  officers  of  any  such  order,  and  shall  be  published,  or  the 
substance  thereof,  in  the  annual  report  of  the  Insurance  Commis- 
sioner under  a  separate  head,  entitled  "Fraternal  Beneficiary  So- 
cieties." 

Section  5.  Each  such  corporation,  society  or  association  now  doing, 
or  hereafter  admitted  to  do  business  in  this  State,  and  not  having 
its  principal  office  within  this  State,  and  not  being  organized  under 
the  laws  of  this  State,  may  be  served  with  each  and  all  processes  of 
law,  whether  mesne  or  final,  in  any  action  or  special  proceedings 
against  said  corporation,  society  or  association,  as  follows:  The 
party  in  whose  favor  suit  is  being  brought,  through  his  attorney  at 
law  shall  notify  in  writing  the  Insurance  Commissioner  of  Georgia 
of  his  intention  to  bring  such  suit  or  action,  and  request  the  said 
Insurance  Commissioner  to  a]i])oiiit  some  resident  of  the  county  of 
the  residence  of  said  plaintiff  in  said  case,  and  it  shall  be  the  duty 
of  the  Insurance  Commissioner  immediately  to  appoint  some  resi- 
dent of  said  county  to  accept  service  of  process  in  all  cases  in  the 
name  of  the  said  corporation,  society  or  association ;  and  the  said 
service,  when  so  made,  shall  be  deemed  and  held  and  accepted  by 
said  cor[-)oration,  society  or  association  to  be  legal  personal  service 
and  binding,  the  same  as  if  made  upon  any  agent  or  officer  of  said 
society  or  corporation;  provided,  that  the  said  party  or  his  attorney 
shall  twenty  days  before  the  appearance  term  for  said  si;it  or 
action,  cause  to  be  sent  tn  the  Insurance  C'ommissioner  a  copy  of  the 
petition.  When  such  service  has  been  made  upon  such  attorney 
for  service  on  any  such  corporation,  society  or  association,  and 
copy  of  same  has  been  forwarded  to  said  Commissioner  as  hereinbe- 
fore provided,  it  shall  be  the  dut,v  of  said  Insurance  Commissioner 
immediately  to  notify  the  said  corporation,  society  or  association  of 
such    service   liy   letter,    enclosing    copy   of  said   petition,    together 


106  FRATERNAL    SOCIETY   LAW 

with  process  filed  in  said  case,  prepaid  and  dii-ected  to  the  secretai-y 
or  its  correspouding  otficer. 

The  Insnrauce  Commissioner  shall  keej)  a  record  of  all  such  at- 
torneys appointed  for  such  service,  together  with  the  record  of 
when  any  such  petitions  with  process  were  received  by  him  in  any 
ease,  and  forwarded  to  any  such  corporation,  society,  or  association. 

Section  6.  The  Insurance  Commissioner  shall,  without  undue  delay, 
upon  the  application  of  any  order,  society  or  association  having 
the  right  to  do  business  in  this  State  as  provided  by  this  Act,  issue 
a  permit  in  writing  authorizing  it  to  do  business  within  the  State, 
for  which  certificate,  and  all  proceedings  in  connection  therewith, 
such  association  shall  pay  to  said  Insx^rance  Commissioner  a  fee  of 
ten  dollars.     This  fee  shall  be  paid  annually  thereafter  in  advance. 

Section  7.  Any  such  order,  association  or  society  refusing  or  neg- 
lecting to  make  the  report  to  the  Insurance  Commissioner,  as  pro- 
vided in  this  Act,  shall  be  excluded  from  doing  business  within  this 
State,  and  the  Insurance  Commissioner  shall  at  once  recall  and  can- 
cel their  license.  Any  officer,  agent  or  person  acting  for  any  order, 
or  subordinate  body  thereof,  within  this  State,  while  it  shall  be  pro- 
hibited from  doing  business  pursuant  to  this  Act,  shall  be  deemed 
guilty  of  a  misdemeanor,  and  on  conviction  thereof  shall  be  pun- 
ished by  a  fine  of  not  less  than  twenty-five  dollars  nor  more  than 
one  hundred  dollars. 

Section  8.  Any  person  who  shall  act  within  this  State  as  an  offi- 
cer, agent  or  otherwise  for  any  such  fraternal  beneficiary  order  in 
soliciting  or  ])roeuring  new  business  or  members,  which  shall  have 
neglected  or  refused  to  comply  with  this  Act.  .shall  be  subject  to 
the  penalty  provided  in  the  last  preceding  section  for  the  misde- 
meanor tlierein  si)ecified. 

Section  9.  All  laws  and  parts  of  laws  in  conflict  with  or  inconsist- 
ent with  this  Act  be,  and  the  same  are,  hereby  repealed,  and  nothing 
in  this  Act  shall  be  held  to  afi'ect  or  to  apply  to  grand  or  subor- 
dinate lodges  of  Masons,  Knights  of  Pythias.  Odd  Fellows,  Red 
Men.  Junior  Ordei-  American  Mechanics,  or  similar  orders  that  do 
not  have  as  their  principal  object  the  Issuance  of  benefit  certificates 
to  members. 

Section  10.  This  .\ct  shall  be  in  force  and  ofl'oet  from  and  after 
its  passage. 


THE    STATE    OF    GEORGIA  107 

Approved  December  17,  IDUO. 

Section  20  of  "An  Act  to  regulate  tlic  business  of  insurance  in 
this  State  and  for  other  purposes,"  which  Act  creates  the  Insurance 
Department  of  the  State,  etc.,  provides,  viz. : 

Section  20.  Be  it  further  enacted,  That  nothing  in  this  Act  con- 
tained shall  apply  to  or  be  construed  to  require  any  fraternal  or 
secret  or  industrial  societies,  or  other  associations  exempt  by  law, 
now  organized  or  to  be  organized  in  this  State,  to  pay  any  license 
fee  or  tax,  or  to  make  or  file  reports  with  the  Insurance  Commis- 
sioner, or  to  prevent  the  same  from  doing  business  in  this  State, 
when  the  monej'',  benefit,  charity  or  relief  is  payable  \)j  the  grand 
or  supreme  body  of  the  same,  and  is  derived  from  assessments  on 
subordinate  lodges,  councils,  or  other  bodies  of  their  members. 

Contract  Between  Members  and  Society — Certificate  Need  Not  be 
Issued. 

A  certificate  of  membership  is  not  indispeusable  to  the  completion 
of  the  contract  between  a  member  and  the  society.  In  the  absence 
of  the  certificate,  it  is  competent  to  look  to  the  by-laws  in  order  to 
determine  the  obligations  of  the  society,  and  unless  there  is  an 
express  provision  that  a  certificate  of  membei'ship  is  essential,  the 
by-laws  and  the  existence  of  good  standing  in  the  society  may  alone 
be  regarded  as  constituting  a  valid  contract. 

Social   Benevolent  Society   No.   1   vs.   Holmes,   Feb.   loth,    1907,   127 
Ga.   586. 

Contract  Must  be  in  Writing. 

The  law  requires  a  contract  of  insurance  to  be  in  writing,  but 
upon  demurrer  it  will  be  presumed  that  the  contract  is  in  writing, 
as  the  law  requires  it  to  be. 

Social   Benevolent    Society   No.    1    vs.    Holmes,    Feb.    loth,    1907,    127 
Ga.    .586. 

Officers  and  Agents — Distinction  Between. 

The  distinction  between  officers  and  agents  of  a  corporation  lies  in 


108  FRATERNAL    SOCIETY    LAW 

the  manner  of  their  creation.    For  a  fall  discussion  upon  this  sub- 
ject, see  the  opinion  of  the  court. 

Vardeman  vs.  Penn.  Mut.  Life  Ins.  Co.,  March  24th,  1906,  125  Ga. 
117. 

Forfeiture — Custom — Estoppel. 

A  custom  to  receive  payments  after  they  are  overdue,  cannot  be 
availed  of  in  the  face  of  a  writing  stipulating  for  prompt  payment, 
and  against  the  power  of  waiving  the  requirement. 

Vardeman  vs.  Penn.  Mut.  Life  Ins.   Co.,  March  24th,   1906,  125  Ga. 
117. 

Beneficiary. 

When  an  application  for  a  policy  of  life  insurance  designates  a 
named  person  as  a  beneficiary,  and  the  policy  is  issued,  which  does 
not  contain  the  name  of  any  person  as  beneficiary,  the  person  named 
in  the  application  is  to  be  treated  as  the  beneficiary  of  the  con- 
tract; aliter,  when  an  application  named  one  person,  but  the  policy 
named  another,  and  the  policy  was  accepted  b.v  the  insured. 

Ogletree  vs.  Hutchinson,  August  13,  1906,  126  Ga.  454. 

Beneficiary— Death  of  Before  Member. 

A  member  of  a  society  named  as  his  beneficiary  his  wife  S,  and 
three  sisters,  who  were  to  have  the  benefit  in  certain  designated 
proportions.  S,  the  beneficiary,  died  intestate,  leaving  the  member 
as  her  sole  heir-at-law.  Svibsequently  the  member  married  J,  who 
survived  hiin.  No  change  in  the  certificate  took  place,  and  at  the 
member's  death  it  remained  in  force  as  issued.  A  law  of  the  society 
provided  that  "in  the  event  of  the  death  before  the  decease  of  the 
member,  of  one  or  more  of  the  beneficiaries  designated  by  him 
•  *  *  if  he  shall  have  made  no  other  and  further 

disposition  thereof  #  #  *  upon  his  death,  that 

part  of  the  benefit  made   payable   Id  the   deceased   beneficiary,   or 
beneficiaries,  shall  be  |)aid  to  the  surviving  beneficiary  or  benefi- 


THE    STATE    OF    GEORGIA  109 

ciaries  equally."  It  was  held  that  under  the  facts  in  the  case,  the 
thi-ee  sisters  named  in  the  certificate,  who  survived  the  member, 
were  entitled  to  have  equally  the  share  which  would  have  gone  to 
S  had  she  lived;  that  J,  the  widow,  was  not  entitled  to  participate 
under  the  certificate.  Contract  and  by-law  in  question  are  those  of 
of  the  Royal  Arcanum. 

Polhill  vs.  Battle,  Nov.  9th,  1905,  124  Ga.   111. 

Forfeiture — Custom — Estoppel. 

"Where  a  certificate  of  insurance  provided  that  all  benefits  there- 
from should  be  forfeited  on  failure  to  pay  the  premiums  as  therein 
stipulated,  and  that  no  agent  was  authorized  to  alter  or  discharge 
contracts,  waive  forfeitures,  or  receive  premiums  in  arrears  beyond 
the  time  provided  in  the  conditions  and  provisions  of  the  certificate, 
the  custom  of  a  mere  collecting  agent  of  a  society  with  reference  to 
the  collection  and  payment  of  premiums,  if  contrary  to  the  terms 
of  the  certificate,  would  not  prevent  a  forfeiture  thereof,  on  the 
failure  by  a  member  to  comply  with  its  conditions  as  to  the  payment 
of  premiums,  where  such  a  custom  was  neither  authorized  or  ratified 
by  the  society. 

American  Assurance  Ass'n  vs.  Hardiman.   Nov.   20th.  1905,  124   Ga. 
379. 

Resort  to  Civil  Courts. 

Where  the  constitution  of  a  society  declared  that  "no  suit  shall 
be  brought  against  this  order  without  first  referring  the  matter  to 
the  grievance  committee,"  with  right  of  appeal  to  the  cabinet,  and 
from  them  to  the  annual  congress,  a  suit  by  a  member  on  a  claim  for 
a  sick  benefit  cannot  be  maintained  without  first  exhausting  the 
remedies  so  prescribed. 

Union  Fraternal  League  vs.  Johnston.  Nov.  20th,  1905,  124  Ga.  902. 

After-enacted  Laws. 

A  member  who  has  agreed  to  comply  with  the  laws  in  force  at  the 


110  FRATERNAL    SOCIETY    LAW 

time  of  his  admission  to  the  society,  and  also  with  such  as  might 
thereafter  be  adopted,  was  held  bound  by  all  laws  lawfully  adopted 
after  his  admission. 

Union  Fraternal  League  vs.  Jolinston,  Nov.  20th,  1905,  124  Ga.  902. 

Misrepresentation — By  Applicant. 

Where  an  applicant  for  life  insurance  states  in  his  application  that 
the  statements  made  to  the  medical  examiner  are  true,  and  these 
statements  are  made  a  pai-t  of  the  contract,  and  form  the  basis 
thereof,  any  variation  iu  them  which  is  material,  whereby  the  nature 
or  extent  or  character  of  the  risk  is  changed,  will  avoid  the  certifi- 
cate, whether  the  statements  were  made  in  good  faith  or  fraudulently 
and  willfully. 

Supreme  Conclave  Knights  of  Damou  vs.  Wood,  .Tune  8th.  1904.  120 
Ga.  328. 

Suicide — Sane  or  Insane. 

In  an  action  upon  a  certificate  containing  terms  which  the  member 
agreed  to,  that  no  benefit  whatever  should  be  paid  upon  his  death, 
should  he  commit  suicide  within  two  years,  while  sane  or  insane, 
and  the  evidence  was  sufScient  to  warrant  a  finding  that  in  less 
than  the  time  mentioned,  the  member  took  his  own  life,  it  was  not 
error  for  the  court  to  charge  the  jury  that  if  the  member  "destroyed 
his  life  by  shooting  himself,  and  at  the  time  he  shot  himself,  did  it 
voluntarily,  and  intended  to  kill  himself,  then  it  would  be  imma- 
terial whether  at  the  time  he  Avas  sane  or  insane,  or  whether  his 
mental  faculties  wore  so  impaired  as  to  destroy  his  moral  responsi- 
bility and  the  plaintiffs  in  this  case  could  not  recover." 

Jenkins  et  al.  vs.  National  Union,  Aug.  14th,  1903,  118  Ga.  587. 

Interpleader — Counsel  Fees. 

In  a  case  of  interpleader  in  which  the  holder  of  a  fund  asked  that 
the  two  claimants  be  decreed  to  intorpload.  and  was  authorized  to 
pay  the  fund  into  court,  the  plaintiil:'  is  not  entitled  to  an  allowance 


THE    STATH    Of    GFAJRGIA  III 

of  counsel  i'cos  \)\  the  tlcerre  .■illowiug  the  interpleudei'.  and  even 
though  such  fund  be  paid  into  thi'  registry  of  the  court.  Various 
aiitliorities  are  cited  in  the  l)riefs  tiled  by  counsel,  and  same  are 
considered  and  coustructl  by  the  court. 

Helmken  vs.  Meyer,  Aug.  14tli,  1903,  118  Ga.  657. 

Void  After-enacted  Laws. 

A  certificate  issued  provided  that  in  consideration  of  a  full  com- 
pliance with  all  the  by-laws  then  existing,  and  thereafter  adopted, 
the  society  agreed  to  pay  the  sum  of  $5,000.00.  Subsequently  a  by- 
law was  adopted,  i)roviding  that  -$2,000.00  should  be  the  highest 
amount  paid  on  any  benefit  certificate  theretofore  or  thereafter 
issued.  Held,  1st,  that  the  agreement  to  pay  $5,000.00  was  a  con- 
tract which  could  not  be  changed  by  a  by-law  so  as  to  reduce  the 
amount  agreed  to  be  paid;  2nd,  that  the  passage  of  sucli  by-law,  and 
an  attempt  to  enforce  it  by  tendering  to  the  member  a  certificate  for 
$2,000.00  in  lieu  of  the  old  certificate,  which  was  requested  for  can- 
cellation, amounted  to  a  repudiation  of  the  contract,  and  gave  tiie 
member  the  right,  at  his  option,  to  bring  an  action  against  the  soci- 
ety for  the  recovery  of  the  amount  paid  as  premiums,  with  interest 
thereon  from  the  time  each  premium  was  paid. 

Supreme  Council  American  Legion  of  Honor  vs.  Jordan,  June  27tli. 
1903,  117  Ga.  808. 

Limitations — Repudiation  of  Contract. 

A  b3-law  provided:  "Ko  action  at  law  or  in  equity  in  any  court 
shall  be  brought  or  maintained  for  anj'  cause  or  claim  arising  out 
of  any  membership  or  benefit  certificate,  unless  such  action  is  brought 
within  one  year  from  the  time  when  such  action  accrues,  and  such 
right  of  action  shall  accrue  ninety  days  after  all  proofs  called  for 
in  case  of  the  death  of  a  member  shall  have  been  furnished."  It  was 
held  that  this  by-law  had  no  application  to  a  suit  to  be  brought  by 
a  certificate-holder  to  recover  back  lU'emiums  paid,  in  the  event  of 
the  society's  repudiation  of  a  contract. 


112  FRATERNAL    SOCIETY    LAW 

Supreme  Council  American  Legion  of  Honor  vs.  Jordan,  June  27th, 
1903,   117  Ga.   SOS. 

Beneficiaries — "Next  of  Kin." 

Where  a  by-law  stipulated  that  no  death  beuetit  shall  be  paid 
except  "to  the  widow,  children,  uncle,  niece,  nephew,  first  cousin, 
next  of  kin,  who  would  be  distributee  of  the  member's  personal 
estate  if  he  died  intestate,  or  to  persons  dependent  upon  the  mem- 
ber," the  words  "next  of  kin"  do  not  limit  the  class  before  enumer- 
ated, but  adds  to  them  another  class. 

Maxwell  vs.  Family  Protective  Union,  April  .30th,  1902,  115  Ga.  475. 

Resort  to  Civil  Courts — Beneficiaries  Not  Bound  by  Rules. 

A  stipulation  in  the  by-laws  that,  "No  suit  shall  be  instituted 
against  this  order  without  first  referring  the  matter  to  the  griev- 
ance committee,  and  if  its  action  be  objected  to  by  either  party,  an 
appeal  may  be  taken  to  the  supreme  council,"  etc.,  was  held  not  to 
apply  to  beneficiaries  of  deceased  members,  but  only  to  members 
themselves. 

Maxwell  vs.  Family  Protective  Union,  April  30th,  1902,  115  Ga.  475. 

After-enacted  Laws — Suicide — Sane  or  Insane. 

While  a  member  in  making  a  contract  with  a  fraternal  society 
may  agree  that  he  will  be  bound  by  the  laws  existing  at  the  date 
of  the  agreement,  and  any  other  laws  that  may  thereafter  be  legally 
adopted,  he  is  entitled  to  rely  upon  the  contract  and  conditions  as 
made,  until  the  law-making  power  of  the  society  enacts  legislation 
which  by  its  terms  applies  to  his  contract.  Applying  this  principle 
to  a  case  where  it  was  stated  that  at  the  time  the  member  made  his 
contract  no  forfeiture  was  prescribed  in  case  he  should  die  by  his 
own  hand  while  insane,  but  that  four  years  later  a  by-law  was  en- 
acted providing  for  forfeitures  in  cases  where  members  died  by  their 
own  hands,  whether  sane  or  insane,  the  court  held  that  the  by-laws 
were  to  be  given  a  ])ro.speetivo  operation  only,  as  the  words  used  in 


THE    STATE    OF    GEORGIA  113 

the  amendment  did  not  niiike  it  clear  that  they  were  to  act  retro- 
spectively. 

Sovereign   Camp   Woodmen   of  the  World   vs.   Thornton,   July   17th, 
1902,  115  Ga.  798. 

Disappearance  of  Member. 

A  certificate  provided  that  "the  disappearance  or  long  continued 
absence  of  a  member  unheard  of  shall  not  be  regarded  as  evidence 
of  death  or  any  right  to  recover  until  the  full  term  of  expectancy 
has  expired. ' '  It  was  held  that  the  beneficiary  named  in  the  certifi- 
cate was  not  entitled  to  maintain  an  action  thereon  on  the  theory 
that  the  insured  had  disappeared  and  was  not  heard  of  or  seen  for  a 
period  exceeding  seven  years,  without  alleging  that  the  full  term  of 
the  member's  expectancy  had  expired. 

Porter  vs.  Home  Friendly  Society,  March  12th,  1902,  114  Ga.  937. 

Agent's  Power — Estoppel. 

"Where  it  was  provided  in  a  benefit  certificate  that  "no  agent  has 
authority  in  any  manner  to  nuike,  alter,  or  discharge  contracts," 
the  beneficiary  was  held  not  entitled  to  maintain  an  action  against 
the  society  on  the  theory  that  one  of  its  agents  had  made  an  agree- 
ment with  such  beneficiary  to  the  effect  that  if  the  latter  would  pay 
the  premiums,  etc.,  for  the  specified  number  of  years,  the  amount  of 
the  insurance  would  be  paid  her. 

Porter  vs.  Home  Friendly  Society,  March  12th,  1902,  114  Ga.  937. 

Beneficiary — Not  Entitled  to  Take. 

In  a  suit  against  a  society  by  one  who  had  been  named  as  benefi- 
ciary in  a  certificate,  and  who  did  not  belong  to  the  class  from  which 
the  member  was  authorized  to  select  a  beneficiary,  it  is  proper  for 
the  court  to  direct  a  verdict  in  favor  of  the  society. 

Union  Fraternal  League  vs.  Walton,  Nov.  28th,  1900.  112  Ga.  315. 


1^4  FRATERNAL    SOCIETY    LAW 

Agency — Beneficiary — Estoppel. 

"Where  it  was  provided  in  a  certificate  that  "no  agent  or  member 
or  other  party  than  the  President  or  Secretary  of  such  order"  shall 
have  the  right  to  change  the  conditions  of  the  contract,  or  to  agree 
to  any  modification  thore(  f.  cr  in  any  other  way  to  alter  or  amend 
the  same,  or  release  any  of  its  conditions,  the  fact  that  other  agents 
of  the  society  than  those  mentioned,  knew  that  the  person  named  as 
beneficiary  in  a  certificate  did  not  belong  to  the  class  from  which 
the  member  was  authorized  to  make  a  selection,  did  not  estop  the 
society  from  calling  in  question  this  i)erson's  right  to  the  fund. 

Union  Fraternal  League  vs.  Walton,  Nov.  28th,  1900,  112  Ga.  315. 

After-enacted  Laws. 

An  after-enacted  by-law  will  be  given  a  prospective  operation  oul\- 
in  the  absence  of  a  clear  intent  that  it  shall  act  retrospectively. 

Ancient  Order  of  United  Workmen  vs.  Brown,  Jan.  24th,  1901,  112 
Ga.  545. 

Forfeiture — Promissory  Warranty. 

"Where  it  is  provided  in  a  contract  that  the  society  shall  not  lie 
held  responsible  if  the  health  of  a  member  shall  become  impaired  by 
the  use  of  narcotics,  or  alcoholic,  vinouS,  or  malt  liquors,  it  is  held 
that  this  stipulation  amounts  to  a  promissory  warranty  on  the  part 
of  a  member,  and  that  the  breach  thereof  will  work  a  forfeiture. 

Waters  vs.  Supreme  Conclave  Knights  of  Damon,   July  23rd,   1S9S. 
105  Ga.  151. 

Member's  Admissions  Bind  Beneficiary. 

Admissions  or  declarations  by  a  member  made  before  his  eertiti- 
eate  is  issued  are  admissible  against  the  beneficiary  in  a  case  wIumt 
it  is  within  thi'  power  of  a  member  to  change  the  beneficiary. 

Supreme   Conclave    Knights    of    Damon    vs.    O'Coniipll,    March    ISth. 
1899,  107  Ga.  97. 


THE    t^TATE    OF    GEORGIA  115 

Suspension  of  Member. 

For  the  facts  iu  a  case  involving  the  suspension  of  a  member  for 
non-payment  of  assessments,  in  which  case  there  was  no  provision 
in  the  contract  for  such  suspension,  see : 

Warwick  vs.  Supreme  Conclave  Knights  ot  Damon,  MarclT  IStli.  1S99, 
107  Ga.   115. 

Suspension — Reinstatement  Personal. 

Where  the  by-laws  require  members  to  make  payment  of  the 
assessments  by  a  certain  day  in  each  month,  or  subject  themselves 
to  suspension,  a  failure  to  pay  his  assessments  within  the  time 
required,  and  his  failure  to  pay  was  reported  to  the  lodge,  upon 
which  the  lodge  took  affirmative  action  iu  suspending  the  member, 
and  the  member  died  thereafter  without  having  been  reinstated, 
the  society  is  not  liable  on  the  contract.  In  this  case  it  is  held  that 
the  offer  of  a  third  person  to  make  payment  after  the  expiration  of 
the  ]iro]ior  time  to  pay  the  assessment.s  of  the  delinquent  could  not 
bind  the  society. 

Supreme  Conclave  Knights  of  Damon  vs.  Warwick,  July  5th,  1900, 
110  Ga.   3SS. 

Beneficiaries — "Family." 

For  a  death  benefit  payable  to  the  family  of  a  deceased,  those 
persons  whose  relationship  to  the  deceased  are  legally  connoted  in 
the  word  "family,"  are  entitled  to  sue,  and  not  his  personal  repre- 
sentative. 

Jackson   vs.   Brothers  and   Sisters  of   Promise,   Court  of  Appeals  of 
Georgia,  Oct.  1907,  59  S.  E.  11. 

Forfeiture  Clauses  not  Favored. 

The  provision  in  the  laws  of  a  society  M'ei"e  to  the  effect  that  "no 
member  shall  be  entitled  to  benefits  who  has  not  paid  dues  and  as- 
sessments in  advance,"  and  that  "members  whose  dues  remain  un- 
paid for  two  months  shall  be  dropped  from  the  roll  and  lose  all 


11(5  FRATERNAL    SOCIETY    LAW 

elaims  to  membership"  were  held  not  to  create  ipso  facto  a  for- 
feiture of  benefits.  There  must  be  some  judicatory  or  affirmative 
action  by  the  society,  declaring  the  member  suspended  or  expelled. 

Starnes  vs.  Atlanta  Police  Relief  Assn.,  June,  1907,  Court  of  Appeals 
of  Ga.,  58  S.  E.  481. 

Beneficiary  Definition  of  "Family." 

The  word  '"family"  used  in  the  laws  of  a  society  to  designate  the 
class  to  which  the  beneficiaries  must  belong,  was  held  to  include 
any  relative  who  lives  ^^^th  the  member  and  who  is  dependent  upon 
him,  or  with  whom  the  member  lives,  and  upon  whom  he  is  de- 
pendent for  support,  and  is  cared  for  at  the  time  of  his  death.  The 
Court  said  "This  combines  the  family  relation  .with  the  fact  of 
dependence,  both  of  which  we  think  .should  exist  in  such  case."  The 
rule  as  stated  above  is  from  the  Court's  opinion,  but  a  majority  of 
the  members  of  the  Court  concurred  upon  a  proper  construction  of 
the  word  "familj^, "  in  a  separate  opinion,  and  gave  the  word  a 
larger  meaning  than  that  given  above.  The  majority  membei-s  of 
the  court  said.  "It  is  a  word  which  may  vary  in  meaning  according 
to  the  conditions  concerning  the  member  at  the  date  of  his  death. 
From  a  review  of  the  decision  we  deduce  the  following  order  of  pre- 
cedence which  should  ordinarily  be  observed  in  determining  who 
are  entitled  to  take  under  the  words  "family  of  the  member.'  or 
similar  designation:  (1)  Wife  and  unmarried  children,  minor  or 
adult;  Or,  if  no  unmarried  children,  ("2)  wife  alone;  or,  if  no  wife, 
(3)  unmarried  children  alone;  or,  if  no  wife  and  no  unmarried  chil- 
dren (4)  perspns  related  by  consanguinity,  or  affinity,  living  with 
the  member  in  the  same  household  :  or,  if  none  of  these,  (5)  any  per- 
son related  by  consanguinity  or  affinity  upon  whom  the  member  is 
dependent;  or,  (6)  any  person  related  by  consanguinity  or  affinity, 
depending  on  and  supported  by  the  member;  or,  if  none  of  these. 
(7)  married  children,  irrespective  of  dependency ;  or.  if  none  of 
these,  (8)  father,  mother,  brothers  and  sisters,  irrespective  of  active 
household  connections  and  irrespective  of  llu'  question  of  depen- 
dence; in  some  instances  even  further  extension  may  be  made,  if 
necessary,  in  order  to  find  a  beneficiary.  The  existence  of  the  benefit 
connotes  a  contemplated  beneficiary,  if  possible." 


THE    STATE    OB'    GEORGIA  117 

Starnes  vs.  Atlg-nta  Police  Relief  Assn.,  June,  1907,  Court  of  Appeals 
of  Ga.,  58  S.  E.  481. 

Tenders  Need  Not  Be  Repeated. 

A  tender  of  the  payment  actually  made  in  good  faith,  and  posi- 
tively declined,  need  not  be  repeated  in  order  to  prevent  a  for- 
feiture of  a  certificate. 

Starnes  vs.  Atlanta  Police  Relief  Assn.,  June,  1907,  Court  of  Appeals 
of  Ga.,  58   S.  E.  481. 

Forfeiture  by  Member's  Violation  of  Criminal  Law. 

A  certificate  provided  that  if  the  death  was  "caused  or  super- 
induced at  the  hands  of  justice"  the  full  amount  of  the  certificate 
should  not  be  recovered.  The  Georgia  Code  provides  that  "death 
by  suicide  or  by  the  hands  of  justice,  either  punitive  or  preventive, 
releases  the  insurer  from  the  obligations  of  his  contract."  Civ.  code 
1895,  §  2118.  The  member  holding  a  certificate  with  the  first  quota- 
tion contained  therein  was  killed  by  a  husband  under  circumstances 
which  warranted  the  lielief  that  the  member  was  guilty  of  adultery 
with  the  wife  of  the  husband.  The  court  held  that  "the  word  'puni- 
tive' certainly  referred  to  death  inflicted  by  an  officer  of  the  law 
in  obedience  to  the  commands  of  the  law.  The  word  'preventive' 
must  be  construed  to  refer  to  a  killing  by  an  authorized  officer  of  the 
law,  or  a  private  person  for  the  time  being  in  the  attitude  of  a  public 
officer;  as  a  member  of  the  .sherifi"s  posse,  or  the  like,  under  these 
circumstances  where  the  law  authorizes  the  taking  of  human  life 
in  the  advancement  of  public  justice.  It  cannot  be  properly  inter- 
preted to  ever  include  the  killing  by  a  private  person  to  avenge  or 
prevent  a  private  wrong,  this  though  the  circumstances  be  such  that 
the  homocide  is  justifiable."  Another  provision  in  the  certificate 
was  to  the  efl:'ect  that  the  Society  should  not  be  liable  for  the  full 
amoiuit  of  the  certificate  if  the  killing  "was  caused  or  superinduced 
by  a  violation  of  the  criminal  law."  And  it  was  claimed  that  the 
member  lost  his  life  as  the  result  of  having  committed  the  offense 
of  adultery  with  the  wife  of  a  person  that  did  the  killing.  The 
Court  reviewed  the  various  authorities  on  the  latter  proposition  and 
announced  its  holding  in  the  following  language:     "If  the  insured 


lly  FliATEh'XAL    SOCIETY    LAW 

commits  au  act  which  is  a  vidlatimi  ot  the  law.  and  u  liich  he  knows 
puts  his  life  in  peril  at  the  time  he  commits  it,  the  company  is  not 
liable  under  a  policy  eoutaiuing  a  stipulation  of  the  character  now 
befox-e  us.  But,  there  must  be  something  in  the  act  itself,  inde- 
pendent of  other  circumstances,  which  makes  the  death  the  reason- 
able consequence.  Death  may  follow  the  commission  of  any  viola- 
tion of  law,  when  a  felony ;  for  the  arresting  officer  is  authorized  to 
kill  under  certain  circumstances  in  order  to  effect  an  arrest,  as  in 
the  case  where  an  insured  robbed  the  state  treasurer,  he  knew  that 
under  the  law  of  the  land  the  arresting  officer,  or  in  some  circum- 
stances, even  a  private  person,  would  have  the  right  to  slay  him  in 
order  to  take  him,  but  his  death  resulting  from  the  effort  to  arrest 
him  was  not  the  reasonable  and  legitimate  consequence  of  the  rob- 
bery he  had  committed  a  few  minutes  before.  One  who  commits  the 
offense  of  adultery  with  a-married  woman  well  knows  that  his  life 
is  imperiled  if  the  outraged  husband  takes  the  guilty  pair  in  the 
unlawful  act,  or  at  its  beginning,  or  at  its  conclusion ;  but  it  cannot 
be  said  as  a  matter  of  law  that  the  killing  of  the  adulterer  is  the 
natural  and  legitimate  consequence  of  the  illicit  intercourse  between 
him  and  the  wife  of  the  wronged  husband.  Death  might  result, 
but  it  cannot  be  any  more  said  that  death  of  the  adulterer  at  the 
hands  of  the  husband  is  the  reasonable  and  legitimate  consequence 
of  the  act  of  adultery  than  it  can  be  said  that  the  death  of  a  felon 
at  the  hands  of  an  arresting  officer  is  the  reasonable  and  legitimate 
consequence  of  the  felony  committed." 

Supreme  Lodge  of  Knights  of  Pythias  vs.  Crenshaw,  August,  1907, 
Supreme  Court  of  Ga..  58  S.  E.  628. 


THE    TEHUITORY    OF    HAWAII  119 


THE 

TERRITORY  OF  HAWAII. 

CHAPTER  12. 

There  is  no  statute  law  of  the  Territory  of  Hawaii  that  in  express 
terms  applies  to  fraternal  benefit  societies.  These  societies  are  not 
in  terms  exempt  from  the  operation  of  the  insurance  laws  of  the 
Territory,  and  for  that  reason  such  provisions  of  the  General  In- 
surance Jaws  of  the  Territory  as  might  under  a  liberal  construction, 
be  held  to  apjily  to  fraternal  benefit  societies,  are  herein  set  forth. 
The  provisions  set  out  are  from  Chapter  159  of  the  Revised  Laws  of 
the  Territory  of  Hawaii,  as  amended  by  Act  77  of  the  Session  Laws 
of  1905,  and  Act  124  of  the  Session  Laws  of  1907. 

Commissioner — Qualification — Forms. 

Section-  2599.  There  shall  be  a  department  charged  with  the  exe- 
cution of  the  laws  relating  to  insurance,  to  be  known  as  the  insur- 
ance department,  the  chief  officer  of  which  shall  be  the  Territorial 
treasurer,  who  shall  be  ex-offieio  insurance  commissioner.  Neither 
the  insurance  commissioner  nor  any  of  his  deputies  or  clerks  shall  be 
directly  or  indirectly  interested  in  any  insurance  corporation  or 
insurance  business  except  as  a  policy  holder.  All  necessary  forms, 
circulars  and  blanks,  together  with  such  pamphlet  copies  of  the 
insurance  laws  as  may  be  required  for  distribution  to  any  person 
at  any  time  by  the  provisions  of  this  chapter,  shall  be  furnished  at 
the  expense  of  the  Territory. 

Deputy  Commissioner. 

Section  2600.  The  insurance  commissioner  shall  appoint  a  deputy, 
and  in  the  absence  of  the  commissioner  or  his  inability  from  any 


120  FRATERNAL    SOCIETY   LAW 

cause  to  exercise  the  powers  and  discharge  the  duties  of  his  office, 
the  powers  and  duties  of  the  office  shall  devolve  on  the  deputy. 

Report  to  Legislature. 

Section  2601.  The  commissioner  shall  transmit  to  each  legislature 
at  the  beginning  of  its  regular  session,  or  within  ten  days  thereafter, 
a  report  containing  a  summary  of  the  statements  and  reports  made 
to  him  pursuant  to  the  in'ovisious  of  this  chapter,  classified,  which  re- 
port shall  also  contain : 

First,  a  statement  of  all  the  insurance  companies  or  corporations 
authorized  to  do  business  in  this  Territory  during  the  biennial  period 
ending  the  thirty-first  day  of  December  next  preceding,  with  their 
names,  locations,  capital  stock,  paid-up  capital,  dates  of  organization 
and  of  the  commencement  of  business  in  this  Territory,  and  kinds 
of  insurance  in  which  the.y  are  engaged  respectively. 

Second,  the  receipts  and  disbursements  of  the  insurance  depart- 
ment during  the  same  period. 

Third,  any  amendment  to  the  insurance  law  which,  in  his  judg- 
ment, are  demanded  for  the  better  protection  of  the  insured  and  the 
people. 

Powers  and  Duties. 

Section  2602.  The  commissioner  shall  see  that  all  laws  of  this 
Territory  respecting  insurance  companies  and  corporations  are  faith- 
fully executed.  He  shall  have  power  to  examine  all  books  and 
accounts  of  any  companies  or  corporations  doing  business  in  this 
Territory,  that  are  organized  under  the  laws  of  this  Territory;  to 
examine  their  officers  and  employees  under  oath ;  to  issue  Rub])oenas 
for  witnesses  to  attend  and  testify  before  him  in  regnrd  to  tlie  busi- 
ness of  said  companies  and  corporations,  and  produce  for  examina- 
tion and  investigation  books,  papers  and  documents  in  relation 
thereto.  Said  subpoenas  must  be  served  in  the  same  manner  as  if 
issued  from  a  court,  and  any  (tcrson  wlm  shall  fail,  neglect  or  refuse 
to  obey  any  sucli  subpixnia  shall  be  deemed  guilty  of  a  misdemeanor 
and  upon  conviction  thereof  shall  be  pimished  by  a  fine  of  not  more 
than  one  hundred  dollars. 


THE    TBKHiroKY    OF    IIAM'AII  121 

Certificate  of  Authority. 

Section  2603.  The  commissioner  shall  i.ssue  to  any  insurance 
company  or  corporation  a  certificate  of  authority  to  transact  busi- 
ness in  this  Territoiy  under  the  following  conditions: 

First — If  a  company  or  corporation  organized  under  the  laws  of 
this  Territory,  when  he  is  satisfied  that  the  provisions  of  this  chapter 
in  relation  to  such  company  or  corporation  have  been  complied  with ; 

Second — If  a  company  or  corporation  organized  outside  of  the 
Territory  of  Hawaii,  when  he  is  satisfied  that  the  company  or 
corporation  has  a  paid-up  and  unimpaired  capital  or  net  surplus  of 
not  less  than  one  hundred  thousand  dt>llars. 

Charter,  Etc.,  to  be  Filed. 

Section  2604.  The  commissioner  shall  cause  every  company  or 
cor])oration  before  engaging  in  the  business  of  insurance  in  this 
Territory  to  file  in  his  office  as  follows : 

First — If  incorporated  under  the  laws  of  this  Territory,  a  copy  of 
its  articles  of  incorporation  witli  any  amendments  made  thereto ; 

Second — If  incorporated  under  the  laws  of  any  other  State  or 
country,  a  copy  of  its  articles  of  incorporation  or  charter,  certified 
by  the  officer  having  the  custody  of  such  articles,  which  certificate 
shall  also  state  that  it  is  organized  under  the  laws  of  such  State  or 
country,  that  it  is  authorized  to  do  business  therein,  and  the  amount 
of  the  capital  stock,  or  net  surplus. 

Term  and  Revocation  of  Certificate. 

Section  2605.  Every  certificate  of  authority  granted  pursuant 
to  the  provisions  of  this  chapter  to  an  insurance  company  or  cor- 
poration to  do  business  in  this  Territory,  shall  expire  on  the  fifteenth 
day  of  April  after  the  date  of  issuance. 

The  statements  and  evidence  of  investment  required  by  this  chap- 
ter to  be  filed  in  the  office  of  the  commissioner  before  a  certificate 
of  authority  is  granted  to  a  company,  shall  be  renewed  from  year 
to  year,  as  prescribed  in  Section  2609. 

If  the  commissioner  is  not  satisfied  that  the  capital,  securities  and 
investment  remain  secure,  and  that  it  may  be  safely  intrusted  with 


122  FRATERNAL    SOCIETY    LAW 

a  continuance  of  its  authority  to  do  business  in  this  Territory,  he 
sluill  revoke  its  certificate  of  authority. 

Publication  of  Revocation. 

Section  26iH>.  When  the  license  or  authority  of  any  insurance 
company  or  corporation  doing  business  in  this  Territory  has  been 
revoked  by  the  commissioner,  the  revocation  shall  be  jniblished  four 
times  in  some  newspaper  of  general  circulation  published  in  this 
Territory. 

Business  Without  Certificate,  Unlawful. 

Section  2607.  It  shall  l)o  unlawful  for  any  company  or  corpora- 
tion to  transact  the  business  of  insurance  in  this  Territory  unless  it 
shall  have  complied  with  all  of  the  provisions  of  this  chapter  and 
obtained  a  certificate  of  aTithority  from  the  commissioner  as  in  this 
chapter  provided. 

Business  Without  Certificate — Penalties. 

Section  litiOS.  If  any  insurance  company  or  corporation,  its  agents 
or  attorney's  shall  solict  insurance  or  shall  issue  a  policy  without 
having  complied  with  the  provisions  of  this  chapter,  the  company 
or  corporation,  or  its  agents  or  attorney  so  issuing  the  jiolicy  or 
accepting  the  application  for  the  same  shall  be  guilty  of  a  misde- 
meanor and  be  subject  to  a  fine  not  less  than  one  hundred  dollars 
nor  more  than  five  hundred  dollars.  If  any  insurance  company  or 
corporation  licensed  to  do  business  in  this  Territory  shall  violate 
any  of  the  provisions  of  this  chapter,  the  commissioner  shall  have 
power,  upon  notice  and  satisfactory  proof  thereof,  to  revoke  the 
license  of  such  company  or  corporation  to  do  business  in  this  Terri- 
tory, and  such  insurance  company  or  corporation  shall  not  again 
he  re-admitted  to  do  business  in  this  Territory  until  it  shall  have 
paid  into  the  treasury  of  the  Territory  the  sum  of  five  hundred  dol- 
lars as  a  pcnnlly  for  such  \'ii)latiiin. 

Agents — License — Penalty. 

Section  2(1(11).     .\"  piTsmi  sliall  act  ;is  agrnt  fni-  any  insui'ance  com- 


THE    TEHltlTOllV    OF    HAWAII  123 

paijy  or  (Mirporatiuu  in  tlic  transaction  oi'  any  oi'  its  hiisiiicss  in  this 
Territory,  or  negotiate  for  or  place  risks  for  any  sucli  orjiani/.atioii 
or  in  any  way  or  manner  aid  such  organization  in  effecting  insurance 
in  this  Territory,  unless  such  organization  shall  have  fully  complied 
with  the  provisions  of  this  chapter.  Every  such  person  before  com- 
mencing business,  ami  on  or  before  the  fifteenth  day  of  each  April 
thereafter,  shall  produce  a  license  of  authority  from  the  insurance 
commissioner,  which  license  shall  grant  the  privilege  of  soliciting 
and  writing  for  any  and  all  kinds  of  insurance  in  this  Territory.  Any 
person  violating  the  ju'ovisioiis  of  this  section  shall  forfeit  to  the 
people  of  the  Tei'rilory  the  sniii  ot  H\'e  Imiiiireil  ddll.-irs  for  the  first 
offense,  and  an  aiklitional  snni  of  one  hiimli'eil  ili}||ars  for  each 
month  during  which  any  sucli  jiei'son  shall  eontinne  to  act  for  any 
unauthorized  insurance  company  oi-  corporation,  or  to  aid  in  effect- 
ing unauthorized  business  or  insurance  in  this  Territm-y. 

Section  2(J(t!JA.  Every  person,  firm  or  corporation  who  in  this 
Territoi'v  ju'ocures,  agrees  to  jirocure  or-  assist  in  procuring  in- 
surance for  a  person,  firm  or  corporation  of  this  Territory,  or  for 
a  foreign  corporation  doing  business  in  this  Territory,  from  any 
insurance  company,  corporation  or  association  not  licensed  to  do 
business  within  this  Territory,  shall  be  guilty  of  a  misdemeanor, 
and,  upon  conviction,  be  jumished  by  a  fine  not  to  exceed  five  hun- 
dred dollars  for  each  offense ;  provided,  however,  that  the  Insurance 
commissioner  may  issue  a  license  to  any  person  residing  in  this  Ter- 
ritory, subject  to  revocation  at  any  time,  permitting  the  i)erson 
named  therein  to  procure  policies  of  insurance  on  risks  located  in 
this  Territory  in  insurance  cinnpanies  not  authorized  to  transact 
business  in  this  Territory,  and  for  such  license  the  Insurance  Com- 
missioner shall  collect  for  the  Territory  an  annual  fee  of  twenty- 
five  dollars.  Said  license  shall  be  valid  until  the  fifteenth  day  of 
April  of  each  year. 

Before  the  person  named  in  such  license  shall  ])rocure  any  insur- 
ance in  such  companies  on  any  such  property,  he  shall  in  every  case 
execute  and  file  with  the  Insurance  Commissioner  an  affidavit  that 
he  is  unable  to  procure  for  a  specified  person,  firm  ov  corporation  in 
a  majority  of  the  companies  authorized  to  do  business  in  the  Terri- 
tory the  amount  of  insurance  necessary  to  jirotect  said  property. 

Every  jierson   so  licensed   shall   keep  a   sejiarate   account   of   the 


124:  FRATERNAL    SOCIETY    LAW 

business  done  under  said  license,  open  at  all  times  to  the  inspection 
of  the  Insurance  Commissioner,  and  shall  file  a  certified  copy  thereof 
forthwith  with  the  Insurance  Commissioner,  showing  the  exact 
amount  and  character  of  such  insurance  placed  for  any  person,  firm 
or  corporation,  the  gross  premiums  charged  thereon,  the  companies 
in  which  the  same  is  placed,  the  dates  of  the  policies  and  the  terms 
thereof,  the  location  of  the  insured  property  and  also  a  report  in  the 
same  detail  of  all  such  policies  cancelled  and  the  gross  return 
thereon. 

Before  receiving  such  license,  the  person  licensed  shall  execute 
and  deliver  to  the  Insurance  Commissioner  a  bond  in  the  penal  sum 
of  two  thousand  dollars,  with  such  sureties  as  the  Commissioner 
shall  approve,  conditioned  that  the  licensee  will  faithfully  comply 
with  all  the  requirements  of  this  section,  and  will  file  with  the 
Insurance  Commissioner  on  or  before  June  first  of  each  year,  a 
sworn  statement  of  the  gross  premiums  charged  for  insurance  pro- 
cured or  placed,  and  the  gross  return  premiums  on  such  insurance 
cancelled  under  such  license  during  the  year  ending  on  the  thirty- 
fii-st  day  of  December  last  preceding,  and  will  paj^  to  the  Insurance 
Commissioner  of  the  Territory  of  Hawaii,  for  the  use  and  benefit 
of  said  Territory,  an  amount  equal  to  four  per  cent,  of  such  gross 
premiums,  less  such  return  premiums  so  reported,  and  in  default  of 
the  payment  of  any  sum  imposed  by  this  section,  the  said  Insurance 
Commissioner  may  sue  for  same  in  any  court  of  record  in  this 
Territory. 

Any  person,  firm,  company  or  corporation  for  whom  such  insur- 
ance as  herein  specified  shall  have  been  efl'ected,  whenever  required 
by  the  Insurance  Commissionr  so  to  do,  shall  produce  for  examina- 
tion by  him  the  policy  or  policies  issued  for  such  insurance,  and  dis- 
close to  him  the  true  amount  of  the  gross  premiums  agreed  to  be 
paid  therefor,  and  upon  refusal  so  to  do  shall  forfeit  to  the  Territory 
of  Hawaii  for  each  such  refusal  the  sum  of  two  hundred  dollars,  to 
be  recovei'ed  in  a  civil  action.  All  policies  and  insurance  contracts 
issued  without  full  compliance,  by  all  parties  concerned,  with  the 
requirements  of  this  Act,  and  of  the  general  insurance  laws  of  the 
Territory,  are  null  and  void. 


THE    TERRITOHY    OF    HAWAII  125 

Resident  Agent  Shall  be  Appointed — Penalty. 

Section  2610.  No  iii.suraiKH'  eomiuiny  oi'  uoqjoratioa  licensed  to 
do  hiisiiiuss  ill  this  TexTitory  shall  accept  any  application  I'or  insur- 
ance, nor  shall  it  write,  issue,  or  deliver  any  policy  of  insurance 
covering-  a  risk  located  within  this  Territory  except  through  a  duly 
appointed  agent  of  such  insurance  company  or  corporation,  who  is 
a  bona  fide  resident,  linn  or  corporation  of  this  Territory,  resident 
herein,  and  licensed  as  agent  of  such  insurance  company  or  corpora- 
tion by  the  Commissioner  to  write  and  solicit  insurance  for  such 
insurance  company,  corporation  or  association.  The  license  of  any 
such  insurance  company  or  corporation  which  shall  violate  this 
section  shall  be  revoked  by  the  commissioner,  and  such  organization 
shall  not  be  again  licensed  to  do  business  in  this  Territory  until  it 
shall  have  paid  into  the  treasury  of  the  Territory  the  sum  of  five 
hundred  dollars  as  a  license  fee.  This  section  does  not  apply  to 
the  acceptance  or  effecting  of  reinsurance. 

Power  of  Attorney — Service. 

Section  2611.  No  insuranc(!  company  or  corporation  organized 
outside  of  this  Territory  shall  be  permitted  to  do  business  in  this 
Territory  until  such  company  shall  have  filed  with  the  Commissioner 
a  power  of  attornej',  which  shall  authorize  a  resident  of  this  Terri- 
tory to  make  and  accept  service  in  any  proceeding  in  any  court  in 
this  Territory  or  of  the  United  States  herein.  If  any  attorney  of  an^^ 
insurance  organization,  appointed  under  the  provi.sions  of  this  chap- 
ter, shall  remove  from  the  Territory,  or  become  disqualified  in  any 
manner  from  accepting  service,  and  if  any  resident  of  this  Terri- 
tory shall  have  any  claim  by  virtue  of  any  insurance  policy  issued 
b.y  any  company  or  organization  not  represented  by  attorney  in  this 
Territory,  valid  service  ma.y  be  made  on  such  company  or  organiza- 
tion by  sei'vice  upon  the  Insurance  Commissioner;  provided,  that 
in  such  case  the  commissioner  shall  immediately  notify  such  com- 
pany by  inclosing  a  copy  of  the  same  by  mail,  postpaid ;  and  pro- 
vided further,  that  in  case  such  proceeding  shall  be  had  within 
sixty  days  after  such  service  on  the  commissioner. 


P26  FRATERNAL    SOCIETY    LAW 

Annual  Statement. 

Section  1^618.  Every  in.surniiee  company  doing  business  in  this 
Territoi\y  shall  : 

First.  Ou  or  before  the  loth  clay  of  April  of  each  year  file  a 
statement  with  the  Commissioner,  verified  by  the  oath  of  its  princi- 
pal executive  officer  residing  witliiu  this  Territory,  or  by  the  princi- 
pal executive  officer  of  the  company,  Avhich  statement  shall  show 
the  total  business  done  in  this  Territory  during  the  year  ending  the 
31st  day  of  December  next  preceding,  and  shall  contain  a  complete 
list  of  agents  in  this  Territory; 

Second.  Make  and  file  with  the  Commissioner  before  the  fifteenth 
day  of  April  of  each  year  a  statement,  verified  by  the  oath  of  the 
president  or  principal  officer  of  such  company,  showing  the  condition 
of  such  company  on  the  31st  day  of  December  next  preceding,  and 
such  statement  shall  show: 

1.  The  amount  of  the  capital  .stock  of  the  company. 

2.  The  property  or  assets  held  by  the  same. 

3.  The  liabilities  of  the  company,  which  must  in  the  case  of  fire 
insurance  companies  include  the  re-insurance  reserve  estimated  at 
fifty  per  cent,  of  the  outstanding  premii;ms,  and  which  in  the  case 
of  life  insurance  companies  uuist  be  computed  on  the  basis  of  either 
the  American  experience  or  the  combined  experience  table  of  mor- 
tality, with  interest  at  the  rate  of  not  less  than  four  per  cent,  per 
annum. 

■4.     The  income  of  the  compan.y  during  the  preceding  year. 
5.     The    total    amount   of   risk    outstanding   on    the   31st   day   of 
December  next  preceding. 

Of  Foreign  Organizations. 

Section  261!l.  Every  organization  foi-eigii  to  this  Territory,  its 
agents  and  officers,  shall  always  be  required  to  malce  the  same  state- 
nu'iits  and  answer  the  same  inquiries  to  the  Insurance  Commissioner 
and  in  case  of  default  be  sub.ject  to  the  same  penalties  and  liabilities 
as  domestic  organizations  doing  the  same  kind  of  business,  or  any 
op  tlie  agents  or  officers  thereof,  are,  or  may  be  liable  to.  under  the 
laws  of  this  Territory  or  the  regulations  of  the  insurance  depart- 
ment. 


THE    TERRITORY    OF    HAWAII  127 

Fees. 

iSeetiou  2620.  The  Couiuiissioner  sliall  requiri;  payment  iu  ad- 
vance of  the  following  fees : 

For  tiling-  articles  of  incorporation,  or  certified  copies  of  ar- 
ticles, by-laws,  or  other  certificates  required  to  be  filed  in 

his  office $25.00 

Fur  issuing  certificates  of  authority 10.00 

For  each  renewal  certificate  of  authority 10.00 

For  filing  the  annual  statement  of  condition 10.00 

For  filing  each  annual  statement  of  business  transacted  in  the 

Territory    10.00 

For  filing  any  other  paper ; 1.00 

For  furnishing  copies  of  papers  filed  in  his  office,  per  folio .  . .         .2.5 

For  certifying  copies,  each 1.00 

For  Agent's  license  for  each  company  represented 2.00 

All  moneys  collected  under  this  chapter  shall  be  paid  into  the 
treasury  of  the  Territory  as  a  government  realization. 

Taxes — Penalty. 

Section  2621.  All  insurance  companies  or  corporations  doing  busi- 
ness in  this  Territory  must  file  with  the  Commissioner  annually,  on 
or  before  the  first  day  of  June,  in  each  year  hereafter,  a  statement 
under  oath,  setting  forth  the  amount  of  gross  premiums  received  by 
said  companies  or  corporations  during  the  year  ending  December 
'■\1.  next  preceding,  from  all  risks  located  in,  and  all  business  done, 
within  this  Territory.  All  such  insurance  companies  or  corpoi-atimis, 
except  life  insurance  companies,  shall  pay  to  the  Treasurer  through 
the  Insurance  Commissioner  a  tax  of  two  per  cent,  on  the  gross 
premiums  received  from  all  risks  located  in,  and  from  all  marine 
business  done  within  this  Territory  during  the  year  ending  on  the 
preceding  31st  day  of  December,  less  return  jiremiums.  re-insurance 
in  companies  or  corporations  authorized  to  do  business  in  this  Ter- 
ritory and  losses  actually  paid  to  policy  holders.  And  if  a  life  in- 
surance company,  shall  pay  to  the  Treasurer  through  the  Insurance 
Commissioner  a  tax  of  two  per  cent,  on  the  gross  premiums  received 
from  all  business  done  within  this  Territoi*y  during  the  year  ending 
on  the  preceding  31st  day  of  December  less  return  premiums,  re- 


128  FRATERNAL,    SOCIETY    LAW 

insurance  in  companies  or  corporations  authorized  to  do  business 
in  this  Territory,  death  claims,  payments  made  to  policy  holders, 
and  actual  operating  and  business  expenses;  which  taxes  when 
so  paid  shall  be  in  settlement  of  all  demands  of  any  taxes  or  licenses 
or  fees  of  every  character  imposed  by  the  laws  of  the  Territory, 
excepting  property  taxes,  and  the  fees  set  forth  in  Section  2620, 
for  conducting  said  business  of  insurance  in  said  Territory.  Said 
taxes  shall  be  due  and  payable  on  the  first  day  of  July  succeeding 
the  filing  of  the  statement  provided  for  in  this  chapter.  Any  organ- 
ization failing  or  refusing  to  render  such  statement  and  to  pay  the 
required  taxes  above  stated  for  more  than  thirty  days  after  the  time 
so  specified,  shall  be  liable  to  a  penalty  of  $25.00  for  each  day  of 
delinquency,  and  the  taxes  may  be  collected  by  distraint,  and  the 
penalty  recovered  by  an  action  to  be  instituted  by  the  Commissioner 
in  the  name  of  the  Territory,  in  any  court  of  competent  jurisdiction, 
and  the  Commissioner  shall  revoke  and  annul  the  certificate  of 
authority  of  such  delinquent  organization  until  such  taxes  and  fine, 
should  any  be  imposed,  are  fully  paid. 

Sick  Benefits — Evidence, 

In  an  action  against  a  society  for  sick  benefits,  the  records  of  a 
similar  former  action  are  admissible  to  show  the  status  of  the 
plaintiff  as  a  member  of  the  society,  and  entitled  to  such  benefits 
at  the  date  from  which  such  benefits  were  claimed, 

De  Fraga  vs.  Portuguese  Mutual  Benefit  Society  of  Hawaii,  Oct.  IStli, 
1895,  10  Hawaii  128. 

Members  May  Resort  to  Civil  Courts. 

A  member  of  a  society  may  sue  for  sick  benefits  in  a  court  of  law, 
if  he  has  not  been  allowed  a  fair  hearing  in  the  tribun^als  of  the 
society. 

De  Fraga  vs.  Portuguese  Mutual  Benefit  Society  of  Hawaii,  Oct.  18th, 
1895,  10  Hawaii  128. 


THU    TtUilUroUY    OF    II  AW  Alt  ]29 

Beneficiary — Dependency. 

For  the  facts  in  a  ease  liolding  that  a  father  aged  60  years  and  a 
cripple,  who  had  a  wife  of  the  same  age  to  sii})port,  and  to  whose 
support  the  member  in  his  lifetime  had  contributed  his  wages,  was 
entitled  to  take  the  benefit  due  ui>iin  a  membership  by  the  member, 
see: 

Daniel   vs.   Portuguese  Mut.   Benefit  Society  of   Hawaii,  Nov.    23rd, 
1896,   10  Hawaii   518. 

Liability  for  Agent's  Negligence. 

A  life  insurance  company  was  held  liable  for  the  negligence  of 
an  agent  in  failing  to  forward  promptly  and  within  a  reasonable 
time  an  application  for  insurance,  and  by  reason  of  snch  negligence, 
the  member  dying  before  the  application  was  passed  upon,  the  bene- 
ficiary was  entitled  to  damages,  and  the  measure  of  damages  in  the 
case  was  stated  to  be  the  amount  for  which  the  policy  would  have 
been  issued  had  the  applicant  been  received  into  the  society. 

Carter  vs.  Manhattan  Life  Insurance  Co.,  June  16th,  1897,  11  Hawaii 
69. 

Contracts — Waivers  Not  Allowed. 

Where  a  contract  of  insurance  provided  that  no  agent  of  the 
society,  except  an  officer,  should  have  power  to  waive  any  provision 
or  condition  of  a  contract,  unless  such  waiver  was  in  writing  upon, 
or  attached  to  the  contract,  proof  was  rejected  of  the  oral  waiver 
by  an  agent. 

Boardman  vs.  Firemen's  Fund  Ins.  Co.,  Feb.  7th,  1902,  14  Hawaii  21. 

Beneficiary — Legal  Heirs. 

The  proceeds  of  an  insurance  contract,  which  was  by  its  terms 
payable  to  the  member's  legal  heirs,  had  been  collected  by  the  ad- 
ministrator of  the  deceased  member's  estate,  were  held  not  to  be 


130  FRATERNAL    SOCIETY    LAW 

assets  of  the  estate  of  the  member,  and  the  administrator  was  de- 
creed to  pay  them  to  the  legal  heirs  of  the  member. 

In  Re  Estate  of  Scrimgeour,  Nov.  6th,  1905,  17  Hawaii  122. 


THE    STATE    OF    IDAHO  131 


THE 

STATE  OF  IDAH(3. 

CHAPTER   13. 

(The  section  uuiubers  are  from  the  Revised  Statutes  of  Idaho.) 

Fraternal  Beneficiary  Association,  What  is — Government  of — Benefit 
Fund — Benefits — to  Be  Paid  to  W^|om,  Etc. 

Section  2246.  A  fraternal  beneficiary  association  is  hereby  de- 
clared to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  tlie  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have 
a  lodge  system,  with  ritualistic  form  of  work  and  representative 
form  of  government,  and  shall  make  provision  for  the  payment  of 
benefits  in  case  of  death,  and  may  make  provisions  for  the  paj'ment 
of  benefits  in  case  of  sickness,  temporary  or  permanent  physical 
disability,  either  as  the  result  of  disease,  accident  or  old  age :  Pro- 
vided, That  the  period  in  life  at  which  payment  of  physical  disability 
benefits  on  account  of  old  age  commences  and  shall  not  be  under 
seventy  (70)  years,  subject  to  their  compliance  with  its  constitution 
and  laws.  The  fund  from  which  the  payment  of  such  benefits  shall 
be  made,  and  the  fund  from  which  the  expense  of  such  association 
shall  he  defrayed  sluill  lie  derived  from  assessments  or  dues  collected 
from  its  members.  Payments  of  death  benefits  shall  be  to  the 
families,  heirs,  blood  relatives,  affianced  husband  or  affianced  wife  of, 
or  person  dependent  upon  the  member.  Such  associations  shall  be 
governed  by  this  chapter  and  shall  he  exempt  from  the  provisions  of 
the  insurance  laws  of  this  State  and  shall  not  pay  a  corporation  or 
other  tax,  and  no  law  hereinafter  passed  shall  apply  to  them  unless 
they  be  expressly  designated  therein.    And  such  fraternal  beneficial 


132  FKATERNAL    i<OCIETY    LAW 

associatiou  may  create,  maiiitaiu.  disburse  and  apply  reserve  or 
emergency  funds  in  accordance  with  its  constitution  or  by-laws. — 
(1901,  6th  Ses.  p.  175.  Sec.  1.) 

Associations  Already  Formed,  to  Comply. 

Section  2247.  All  such  associations  coming  within  the  description 
as  set  forth  in  the  preceding  section,  organized  under  the  laws  of 
this  or  any  other  State,  province  or  Territory,  and  now  doing  busi- 
ness in  this  State,  may  continue  such  business :  Provided,  That  thej^ 
hereafter  comply  with  the  provisions  of  this  chapter  regulating  an- 
nual reports  and  the  designation  of  the  commissioner  of  insurance 
as  a  person  upon  whom  process  may  be  served,  as  hereinbefore  pro- 
vidd.— (1901,  6th  Ses.  p.  176.  See.  2.) 

Foreign  Associations. 

Section  2218.  Any  such  association  organized  under  the  laws  of 
any  other  State,  Province  or  Territory  and  now  doing  business  in 
this  State  shall  be  admitted  to  do  business  within  this  State,  when 
it  shall  have  filed  with  the  commissioner  of  insurance  a  duly  certified 
copy  of  its  charter  and  articles  of  association  and  a  copy  of  its  con- 
stitution or  laws,  certified  to  by  its  secretary  or  corresponding  officer, 
together  with  an  appointment  of  the  commissioner  of  insurance  of 
this  State  as  a  person  upon  whom  process  shall  be  served  as  herein- 
after provided :  And,  provided,  That  such  association  shall  be  shown 
to  be  authorized  to  do  business  in  the  State,  Province  or  Territoiy  in 
which  it  is  incorporated  or  organized,  in  case  the  laws  of  such  State, 
Province  or  Territory  shall  provide  for  such  authorization ;  and  in 
case  the  laws  of  such  State,  Province  or  Territory  do  not  ])rovide 
for  any  formal  authorization  to  do  business  on  the  part  of  any  sucli 
association,  then  such  association  shall  be  shown  to  be  conducting  its 
business  within  the  provisions  of  this  chapter  for  which  purpose  the 
commissioner  of  insurance  of  this  State  may  personally  or  by  some 
person  to  be  designated  by  him,  examine  into  the  condition  of  affairs, 
cliaracter  and  business  nu^hods,  accounts,  books  and  investments 
of  such  associaticui  at  its  home  ot'lioe.  wliieli  cxaiiiiiialiDn  shall  be  at 
the  expense  of  such  associatiou,  and  shall  be  made  within  thirty 
days  after  demand  thereof,  and  the  expense  of  such  examination 


THE    STATE    OF    IDA  110  133 

shall  be  limited  to  fifty  dollars:  Provided,  Such  person  appointed 
to  examine  into  the  affairs  of  any  fralernal  beneficiary  association 
shall  not  be  a  member  of,  or  in  anywise  connected  with  said  frater- 
nal beneficiary  association. —  (1901,  (itli  Ses.  p.  176,  Sec.  3.) 

Fraternal  Beneficiary  Association  to  Make  Reports — Contents. 

Section  2249.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  daj*  of  March  of  each  year,  maice  and 
file  witli  the  commissioner  of  insurance  of  this  State  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  31st  day  of 
December  immediately  preceding,  which  annual  report  shall  be  in 
lieu  of  all  other  reports  required  by  any  other  law.  Such  report 
shall  be  ui)on  blank  forms  to  be  provided  by  the  commissioner  of 
insurance,  or  may  be  printed  in  pamphlet  form,  and  shall  be  verified 
under  oath,  by  the  didy  authorized  officers  of  such  association,  and 
shall  be  pxdjlished,  or  the  substance  thereof,  in  the  annual  report  of 
the  commissioner  of  insui-aiici'  niulcr  a  scpai-atc  pai't  entitled  '"Fra- 
ternal beneficiary  assoeiation  "  and  shall  contain  answers  to  the  fol- 
lowing   questions: 

1.  Number  of  certificates  issued  during  the  year,  or  members 
admitted. 

2.  Amount  indemnity  affected  thereby. 

3.  Number  of  losses  or  benefit  lialiilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representatives 
or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

S.  Number  and  kind  of  claims  comprised  or  resisted  and  brief 
statement  of  reasons. 

9.  Does  association  charge  anniuil  oi'  jieriodical  dues  or  admission 
fee? 

10.  How  much  on  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be? 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 


134  FRATERNAL    SOCIETY    LAW 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  association  guarantee  iu  its  certificate  tixed  amount 
to  be  paid  regardless  of  amount  realized  from  assessments,  dues,  ad- 
mission fees  and  donations? 

l-i.  If  so,  state  amount  guaranteed,  and  the  security  of  such 
guarantee. 

15.  Has  the  association  a  reserve  or  emergency  fund? 

16.  If,  so,  how  is  it  created  and  for  what  purpose,  the  amount 
thereof,  and  how  invested? 

17.  lias  the  association  more  than  one  class? 

IS.     If  so.  how  many  and  the  amount  of  indemnity  in  each? 

19.  Number  of  members  in  each  class. 

20.  If  voluntary,  so  state  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  \mder  what  law 
and  at  what  time :  giving  chapter  and  year  and  date  of  passage  of 
the  act? 

22.  If  organized  under  tlie  hiws  of  any  other  State,  Province  or 
Tei-ritory,  state  such  fact  and  date  or  organizMtion.  giving  chapter 
and  j^ear  and  date  of  passage  of  the  act. 

23.  Number  of  certificate  of  beneficiary  membersliip  lapsed 
during  the  year. 

24.  Number  in  force  at  the  beginning  and  end  of  .year;  if  more 
than  one  class  number  in  each  class. 

25.  Names  and  addresses  of  its  presidents,  secretary  and  treas- 
urer-, or  corresponding  officer. 

Tile  commissioner  of  insurance  is  authorized  and  empowered  to 
address  any  additional  inquiries  to  any  such  association  in  relation 
to  the  matter  embraced  in  such  report,  and  such  officers  of  such 
association  as  the  commissioner  of  insurance  may  require  shall 
promptly  reply  in  writing,  under  oath,  to  all  such  inquiries. —  (1901, 
6th  Ses.  p.  177,  See.  4.) 

Service  of  Process  on  Fraternal  Beneficiary  Association. 

Section  2250.  Eaeli  association  now  doing  or  hereafter  admitted 
to  do  business  within  this  State,  not  having  its  principal  office  in  this 
State,  and  not  having  organized  \mder  the  laws  of  this  State,  shall 
apjioint,   in   writing,   the   commissioner   of   insurance   and   his   sue- 


THE    STATE    OF    IDAHO  135 

cessors  in  office  to  be  its  true  and  lawful  attorneys  and  upon  whom 
all  lawful  process-  in  any  action  or  proceeding  against  it  may  be 
served  and  in  such  writing  shall  agree  that  any  lawful  process 
against  it,  which  is  served  on  said  attorney  sliall  be  of  the  same 
legal  force  and  validity  as  if  served  upon  the  association,  and  that 
the  authority  shall  coutiuue  in  force  so  long  as  any  liability  remains 
outstanding  in  this  State.  Copies  of  such  certificate,  certified  by 
said  commissioner  of  insurance,  shall  be  deemed  sufficient  evidence 
thereof  and  shall  be  admitted  in  evidence  with  the  same  force  and 
effect  as  the  original  thereof  might  be  admitted.  Service  upon  such 
attorney  shall  be  deemed  sufficient  service  ujiou  such  association. 
When  legal  process  against  any  such' association  is  served  upon  said 
commissioner  of  insurance,  he  shall  immediately  notify  the  associa- 
tion of  such  service  by  letter,  prepaid  and  directed  to  its  secretary 
or  corresponding  officer,  and  shall,  within  two  days  after  such 
service,  forward  in  the  same  manner  a  copy  of  the  process  served 
on  him  to  such  officer.  The  plaintiff  in  such  jiroeess  so  served  shall 
pay  the  eommis.sioner  of  insurance  at  the  time  of  such  service  a  fee 
of  three  dollars  which  shall  be  recovered  by  him  as  part  of  the 
taxable  costs,  if  he  prevails  in  the  suit.  The  commissioner  of  in- 
surance shall  keep  a  record  of  all  process  served  iipon  him,  which 
record  shall  show  the  day  and  hour  when  such  service  was  made 
and  by  whom  made.— (1901,  6th  Ses.  p.  178,  Sec.  5.) 

Permit  to  Do  Business — How  Obtained. 

Section  2251.  The  commissioner  of  insurance  of  this  State  shall, 
upon  the  application  of  any  association  having  the  right  to  do  busi- 
ness within  this  State,  as  provided  in  this  chapter,  issue  to  such 
association  a  permit,  in  writing,  anthori;^ing  such  association  to  do 
business  within  this  State,  for  which  certificate  and  all  proceedings 
in  connection  therewith  such  association  shall  pay  to  said  commis- 
sioner of  insurance  the  fee  of  five  dollars. — (1901.  6th  Sees.  p.  179. 
Sec.  6.) 

How  Incorporated. 

Section  2252.     Fraternal  beneficial  associations  shall  be  incorpor- 


2^36  FRATERNAL    SOCIETY    LAW 

ated  in  mauiier  as  now  is  or  may  be  iiereinafter  pi-ovidi-d  by  law. — 
(1901,  6th  Ses.  p.  179,  Sec.  7.) 

Association  Shall  Not  Employ  Agents— When. 

Section  2253.  Such  association  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members  except  in  the  organization  or  build- 
ing up  of  subordinate  bodies  or  granting  members  inducements  to 
procure  new  members. — (1901,  6th  Ses.  p.  179,  Sec.  8.) 

Contract  of  Beneficiary  to  Pay  Dues — Effect  of. 

Section  2254.  No  contract  between  a  member  and  his  beneficiary, 
and  the  beneficiary  or  any  person  for  him.  by  which  said  beneficiary 
or  an.y  person  for  him.  shall  pay  such  member's  assessments  and 
dues,  or  either  of  them,  shall  give  the  beneficiary  a  vested  right 
in  the  benefit  certificate  or  in  the  benefit  or  deprive  the  member  of 
the  right  to  change  the  name  of  the  beneficiary,  or  revoke  the  certifi- 
cate, if  any  issued  by  the  association :  Provided,  That  such  change 
or  revocation  be  done  by  written  or  printed  notice  to  the  association 
in  the  manner  and  form  provided  for  by  law. —  (1901,  6th  Ses.  p. 
180,  Sec.  9.) 

Benefits  Not  Liable  to  Attachments,  Execution  or  Other  Process, 
Etc. 

Sietion  2255.  The  money  or  other  benefit,  charity,  relief  or  aid 
already  paid  or  to  be  paid,  provided  or  rendered  by  any  association 
authorized  to  do  business  under  this  chapter,  shall  not  be  liable  to 
attachment  or  execution  by  trustee,  garnishee  or  other  process,  and 
shall  not  be  seized,  taken,  appropriated  or  applied  by  any  legal  or 
equitable  ]irocess.  or  by  the  operation  of  law,  to  pay  any  debt  or 
liability  of  a  certificate  holder  or  any  beneficiary  named  in  the  cer- 
tificate, or  any  person  who  may  have  rights  thereunder. —  (1901,  6th 
Ses.  p.  180,  Sec.  10.) 

May  Provide  for  Meetings  of  Legislative  Body  in  Any  Other  State — 
Vote  of  Subordinate  Bodies  in  Other  States. 

Section  2256.     Any  such  association  organized  nndor  the  laws  of 


THE    STATE    OF    IDAHO  137 

this  State  may  provide  for  the  meeting  of  its  legislative  or  govei'u- 
iiig  body  ill  any  other  State,  Province  or  Territory  wherein  such 
assoeiatioii  shall  have  suboi'dinalc  liodii's.  ami  all  i)iisiness  transacted 
at  siu'h  meetings  shall  be  \  a  lie  I  in  all  respects,  as  if  such  meetings 
were  held  within  the  State,  and  wiien  the  laws  of  any  such  associa- 
tion provide  for  the  election  of  ils  officers  b.v  votes  to  be  east  in  its 
subordinate  bodies  the  \dt('  so  east  in  llic  subordinate  bodies  in  any 
other  State.  Province  or  Territory,  shall  be  valid  as  if  cast  within 
this  State.— (.1901,  6th  Ses.  p.  180,  See.  11.) 

Penalty  for  False  and  Fraudulent  Statements. 

Section  2257.  Any  jierson,  officer,  memiicr  or  examining  ph.vsician 
who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent  state- 
ment or  representation  in  or  with  reference  to  an.y  application  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit 
in  any  association  transacting  business  under  this  chapter,  shall  be 
guilty  of  a  misdemeanor,  and,  upon  conviction,  shall  be  punished 
b.y  a  fine  not  less  than  one  hundred  dollars  nor  more  than  five  hun- 
dred dollars,  or  by  imprisonment  in  the  county  ,iail  for  not  less 
than  thirty  days  nor  more  than  one  year,  or  by  both,  in  the  dis- 
cretion of  the  court,  and  any  person  who  shall  wilfully  make  any 
false  statement  of  any  material  fact  or  thing  in  a  sworn  statement 
as  to  the  death  or  disability  of  a  C(n'tificate  holder  in  any  such 
association  for  the  purpose  of  jirocuring  payment  of  a  benefit  named 
in  the  certificate  of  such  holder,  and  any  person  who  shall  wilfully 
make  any  false  statement,  in  any  verified  report  or  declaration, 
under  oath  required  or  authorized  by  this  chapter,  shall  be  guilty  of 
per.iury,  and  shall  be  proceeded  against  and  punished  as  provided 
by  the  statute  of  this  State.— (1901.  6th  Ses.  p.  180,  Sec.  12.) 

Penalty  for  Refusing  or  Neglecting  to  Make  Report — Duty  of  Com- 
missioner of  Insurance — Injunction,  Etc. 

Section  2258.  Any  svicli  association  refusing  or  neglecting  to 
make  the  report,  as  provided  in  this  chapter,  or  to  appoint  the 
commissioner  of  insurance  as  its  true  and  lawful  attorne.v  for  the 
purpose  of  this  chapter,  shall  be  exchided  from  doing  business  within 
this  State.    Said  commissioner  of  insurance  must,  within  sixty  days 


138  FRATERNAL    SOCIETY    LAW 

after  failure  to  make  such  report,  or  in  auy  case  such  association 
shall  exceed  its  power  or  conduct  its  business  fraudulently,  or  shall 
fail  to  comply  with  any  of  the  provisions  of  this  chapter  give 
notice,  in  writing,  to  the  attorney  general,  who  shall  immediately 
commence  an  action  against  any  such  association  to  enjoin  the  same 
from  carrying  on  any  business.  And  no  injunction  against  such 
association  shall  be  granted  by  auy  court,  except  on  the  application 
of  the  attorney  general  at  the  request  of  the  commissioner  of  insur- 
ance. No  such  association  so  enjoined  shall  have  authority  to  con- 
tinue to  do  business  until  such  report  shall  be  made,  or  overt  act 
or  violation  complained  of  shall  have  been  corrected  and  until  the 
cost  of  such  action  be  paid  by  it :  Provided,  The  court  shall  find  that 
such  association  was  in  default  as  charged.  "Whereupon  the  com- 
missioner of  insurance  sliall  reinstate  such  association  and  not  until 
then  shall  such  association  be  allowed  to  again  do  business  in  this 
State.  Any  ofScer,  agent,  or  person  acting  for  any  association  or 
subordinate  body  thereof  within  this  State,  while  such  association 
shall  be  enjoined  or  prohibited  from  doing  business  pursuant  to  this 
chapter,  shall  be  deemed  guilty  of  a  misdemeanor,  and.  on  convic- 
tion thereof,  shall  be  pimished  by  a  fine  not  less  than  twenty-five 
dollars  nor  more  thn  two  hiindred  dollars,  or  by  imprisonment  in 
the  county  jail  for  not  less  than  thirty  days  nor  more  than  one  year, 
or  by  both  such  fine  and  imprisonment  in  the  discretion  of  the 
court.— (1906.  6th  Ses.  p.  181.  Sec.  13.) 

Failing  to  Comply  With  Chapter — Agent  Guilty  of  Misdemeanor. 

Section  2259.  Any  person  wlio  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise  for  auy  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provisions  of  this  chapter,  or  shall  have  failed  or  neg- 
lected to  procure  from  the  commissioner  of  insurance  a  proper 
certificate  of  authority  to  transact  business  as  provided  by  this 
chapter,  shall  be  subject  to  the  penalty  provided  in  the  last  pre- 
ceding section  for  the  misdemeanor  therein  specified. — -(1901.  6th 
Ses.  p.  182.  Sec.  14.) 


THE    STATU    OF    IDAHO  W.) 

Fees  For  Report — Fraternal  Beneficiary  Association. 

Section  2260.  Every  fraternal  beneficiary  society  to  which  this 
chapter  is  applicable  sliall  pay  to  the  insurance  commissioner  for 
filing  annual  statement  as  provided  by  this  chaiiter,  twenty-five 
dollars.— (1901,  Gth  Ses.  p.  182,  Sec.  15.) 

Chapter  Not  Applying  to  Masons,  Odd  Fellows,  or  Similar  Orders. 

Section  2261.  This  chapter  shall  not  ajiply  to  any  grand  or  sub- 
ordinate lodge  of  the  order  of  Free  and  Accepted  Masons.  Inde- 
'pendent  Order  of  Odd  Fellows,  as  they  now  exist,  nor  to  similar  or- 
ders or  secret  societies,  nor  to  fraternal  societies  whose  snbordinate 
or  national  bodies  pay  nothing  but  funeral  or  weekly  sick  benefits, 
nor  to  any  organization  conducted  solely  for  benevolent  and  charit- 
able purposes,  whose  members  are  employed  by  one  corporation  or 
institution  or  by  more  than  one  similar  corporation  or  institution, 
or  whose  membershi]i  is  confined  to  one  trade,  ;ii-t  or  profession. — 
(1901.  6th  Ses.  p.  182.  Sec.  16.) 

Agency  of  Collecting  Officer. 

Where  it  is  expressl.y  provided  in  the  constitution  of  a  society 
that  the  secretary  of  a  subordinate  lodge  shall  collect  and  forward 
to  the  supreme  lodge  all  assessments  paid  by  members,  such  secre- 
tary is  the  agent  of  the  supreme  lodge,  and  the  payment  of  assess- 
ments by  members  to  such  secretary  is  payment  to  the  supreme 
lodge,  notwithstanding  the  fact  that  the  constitution  contained  a 
provision  in  general  terms  that  the  officers  of  a  subordinate  lodge 
are  agents  of  the  members  and  not  agents  of  the  supreme  lodge. 

Reert  vs.  Ancient  Order  of  Red  Cross.  May  29th.  1902.  S  Idaho  409. 

Privileged  Communications — Physicians — Waiver  of  Exemptions. 

A  certificate  issued  by  the  Modern  Woodmen  provided  that  if  the 
member  should  die  from  small-pox  there  should  be  no  liability.  In 
a  suit  involving  the  certificate,  the  cause  of  the  member's  death 
being  in  issue,  the  testimony  of  the  attending  physician  was  ofi'ered 
by  the  society  and  objection   was  made  to   the  testimony   on  the 


14:0  FRATERNAL    SOCIETY    LAW 

ground  that  it  was  privileged  under  tlie  statutes  of  Idaho.  The  sec- 
tion of  the  statutes  involved  in  the  ease  is  5958  Revised  Statutes, 
providing  as  follows : 

"There  are  particular  relatioiis  in  which  it  is  the  policy  of  the 
law  to  eucourage  confidence  and  to  preserve  it  inviolate.  Therefore 
a  person  cannot  be  examined  as  a  witness  in  the  following  cases, 
*  *  *  *  4. — A  phj'sieian  or  surgeon  cannot  without  the 
consent  of  his  patient  be  examined  in  a  civil  action  as  to  any  infor- 
mation acquired  in  attending  the  patient  which  was  necessary  to 
enable  him  to  prescribe  or  act  for  the  patient." 

There  was  contained  in  the  application  for  membership  upon 
which  the  certificate  of  membership  sued  was  issued,  the  followiug 
provision,  which  was  agreed  to  over  the  signature  of  the  member : 

"And  I  hereby  expressly  waive  for  myself  and  beneficiaries  the 
privileges  or  benefits  of  any  and  all  laws  which  are  now  or  may  be 
hereafter  enforced  making  incompetent  the  testimony  of  or  dis- 
qualifying any  physician  fi'om  testifying  concerning  any  informa- 
tion obtained  by  him  in  a  professional  capacity." 

In  passing  iipon  and  determining  the  validity  of  the  waiver  con- 
tained in  the  application  and  set  out  above  the  court  reviewed  the 
leading  authorities,  and  announced  the  law  in  the  following  lan- 
guage : 

"In  the  light  of  the  foregoing  authorities  and  with  the  under- 
standing we  gather  as  to  the  intention  and  purpose  of  the  statute. 
.  we  see  no  reason  why  the  Court  should  not  give  force  and  effect  to 
the  clause  in  the  contract  making  the  attending  physician  competent 
to  testify  in  all  matters  the  same  as  other  witnesses.  In  that  view 
of  Ihe  case  there  could  be  no  question  but  that  the  testimony  of  Dr. 
Taylor  was  properly  admitted.  The  benefits  of  the  waiver  are 
equally  as  available  to  the  beneficiary  as  to  the  insurer." 

Trull   vs.   Modern   Woodmen   of   America,   May.   1906,   12    Idaho   318; 
85   Pac.   1081. 


THE    STATI-:    OF    lLLl.\UJii  141 


ruE 
STATE   OF    ILLINOIS. 

CHAPTER  14. 

An  Act  to  provide  for  the  organization  and  management  of  fraternal 
beneficiary  societies  for  the  purpose  of  furnishing  life  indemnity 
or  pecuniary  benefits  to  beneficiaries  of  deceased  members  or 
accident  or  permanent  indemnity  disability  to  members  thereof, 
and  to  control  such  societies  of  this  State  and  of  other  States  doing 
business  in  this  State,  and  providing  and  fixing  the  punishment 
for  violation  of  the  provisions  thereof,  and  to  repeal  all  laws  now 
existing  which  conflict  herewith,  approved  and  in  force  June  22, 
1893,  and  all  acts  amendatory  thereof  and  supplemental  thereto, 
in  force  July  1,  1901,  (amended  May  23,  1907,  by  adding  Sec.  4A). 

Fraternal  Beneficiary  Society  Defined — Funds — Benefits. 

Section  1.  A  fraternal  beneficiary  society  is  hereby  declared  to  be 
a  corporation,  society  or  association  formed,  organized  or  carried  on 
for  the  sole  benefit  of  its  members  and  their  beneficiaries,  and  not 
for  profit.  Bach  society  shall  have  a  lodge  system,  with  ritualistic 
form  of  Avork  and  representative  form  of  government,  and  may  make 
provisions  for  the  payment  of  benefits  in  case  of  disability  and  death, 
or  of  either,  resulting  from  either  disease,  accident,  or  old  age,  of 
its  members.  Any  such  society,  order  or  association  may  create, 
maintain  and  disburse  a  reserve  fund  in  accordance  with  its  consti- 
tution and  by-laws.  Such  reserve  fund,  if  any,  shall  represent  cer- 
tain prescribed  accumulations  or  percentage-  retained  for  the  benefit 
of  its  members  or  their  beneficiaries,  and  no  part  thereof  shall  be 
used  for  expenses,  nor  for  any  purpose  except  the  payment  of 
death  and  disability  claims;  the  pa.vment  of  such  benefits  in  all 
eases  being  subject  to  compliance  by  the  member  with  the  contract 


142  FRATERNAL    SOiJlETY    LAW 

rules  and  laws  of  society:  Provided,  The  period  in  life  at  which 
payment  of  physical  disability  benefits  on  account  of  age  may  com- 
mence shaU  not  be  under  seventy  (70)  years.  The  fund  from  which 
the  payments  of  such  benefits  shall  be  made,  and  the  fund  from 
which  the  expenses  of  such  societj'  shall  be  defrayed,  shall  be  de- 
rived from  assessments  or  dues  collected  from  its  members.  Pay- 
ments of  death  benefits  shall  only  be  paid  to  the  families,  heirs, 
blood  relations,  afSanced  husband  or  affianced  wife  of,  or  to  persons 
dependent  upon  the  member:  Provided,  That  a  member  having 
no  wife  or  children  living  may,  with  the  consent  of  the  society, 
make  a  charitable  institution  his  beneficiary;  Provided,  however, 
That  societies  formed  to  include  only  the  membership  or  any  re- 
ligious denomination  may  be  permitted  to  provide  that  benefits 
under  their  certificates  of  membership  may  be  paid  to  religious  or 
charitable  institutions.  The  members  of  any  religious  denomination 
may  incorporate  under  this  act,  and  shall  only  be  required  to  have 
a  lodge  or  branch  system  and  a  representative  form  of  government. 
Membership  in  such  corporation  shall  be  confined  to  the  members 
of  such  religious  organization.  Commercial  travelers  shall  also  be 
allowed  to  incorporate  under  the  provisions  of  this  act,  but  member- 
ship of  such  incorporation  shall  be  confined  to  those  actively  en- 
gaged as  commercial  travelers,  and  officers,  buyers  or  sellers  for 
corporations,  associations  and  co-partnerships,  or  individuals  who 
employ  commercial  traveling  men.  Such  commercial  travelers'  in- 
corporation shall  have  a  lodge  or  branch  system  and  representative 
form  of  government.  All  such  societies  shall  be  governed  by  this 
act,  and  shall  be  exempt  from  the  provisions  of  all  insur;iuce  laws 
in  this  State,  and  no  law  hereafter  passed  shall  apply  to  them  unless 
they  be  expressly  designated  therein :  Provided,  That  this  act 
shall  not  be  construed  to  prevent  any  society  having  a  supreme  lodge 
with  separate  .iurisdiction,  which  by  their  law  provides  for  a  general 
relief  or  reserve  fund,  for  making  assessments  to  pay  its  pro  rata 
share  of  such  relief  or  reserve  fund,  or  fi-om  receiving  their  pro  rata 
of  any  such  fund.  [As  amended  by  an  act  approved  May  11.  1901, 
in  force  July  1,  1901.] 

Existing  Societies  May  Continue — Condition. 

Section  2.     All  such  societies  coming  witliiii  the  description  as 


THE    UTATE    OF    ILLI.XOIH  143 

set  forth  in  section  1  of  this  <u;t,  orgaiiizcKl  uudcr  the  laws  of  this 
or  any  other  State,  ami  now  doing'  Inisiness  in  tliis  State,  shall 
be  considered  duly  organized,  and  may  continue  such  business: 
Provided,  That  they  hereafter  make  application  for  such  permission 
and  comply  with  the  provisions  of  this  act  regulating  annual  reports, 
and  the  designation  of  the  Insurance  Superiuteudeut  as  the  pei'son 
upon  whom  process  may  be  served,  as  hereinafter  provided.  [As 
amended  by  an  act  approved  June  21,  1895,  in  force  Julj^  1,  1895.] 

Admission  of  Societies — Conditions. 

Section  3.  Auj-  such  society  coming  withiu  the  descriiDtion  as 
set  forth  in  section  1  of  this  act,  organized  under  the  laws  of  any 
other  State,  province  or  territory,  and  not  now  doing  business  in 
this  State,  shall  be  admitted  to  do  business  within  this  State  when 
it  shall  have  filed  with  the  Auditor  of  Public  Accounts  [Insurance 
Superintendent]  a  duly  certified  copy  of  its  charter  and  articles  of 
association,  accompanied  by  a  fee  of  $10,  and  a  copy  of  its  consti- 
tution and  laws,  certified  to  bj^  its  secretary,  and  a  certificate  duly 
verified  by  such  officer  to  the  effect  that  such  society  has  paid  all 
approved  death  claims  in  full  for  a  period  of  at  least  six  months 
prior  to  applying  for  permission  to  do  business  within  this  State, 
together  with  an  appointment  of  the  Auditor  of  Public  Accounts 
[Insurance  Superintendent]  of  this  State  as  a  person  upon  whom 
process  may  be  served  as  hereinafter  provided :  And,  provided, 
That  such  society  shall  be  shown  bj'  certificate  to  be  authorized  to 
do  business  in  the  State,  province  or  territory  in  which  it  is  incor- 
porated or  organized,  in  ease  the  laws  of  such  State,  province  or 
territory  shall  provide  for  such  authorization,  and  in  ease  the  laws 
of  such  State,  province  or  territory  do  not  provide  for  any  formal 
authorization  to  do  business  on  the  part  of  any  such  society,  then 
sncli  society  must  be  shown  to  be  conducting  its  business  in  accord- 
ance with  the  provisions  of  this  act,  for  which  pui-pose  the  Auditor 
of  Public  Accounts  [Insurance  Superintendent]  of  this  State  ma}^ 
personally,  or  by  some  person  to  be  designated  by  him,  exanyue 
into  the  condition,  affairs,  character  and  business  methods,  accounts, 
books  and  investments  of  such  society  at  its  home  office,  which  ex- 
amination shall  be  at  the  expense  of  such  society. 


144  FRATERNAL   SOCIETY   LAW 

Annual  Report — Form. 

Section  4.  Every  such  society  doing  business  in  this  State,  shall, 
on  or  before  the  first  day  of  March  of  each  year,  make  and  file 
with  the  Auditor  of  Public  Accounts  [Insurance  Superintendent]  of 
this  State,  a  report  of  its  affairs  and  ojierations  during  the  .year 
ending  on  the  31st  day  of  December  immediately  preceding,  together 
with  a  copj'  of  constitution  and  laws  then  in  force,  which  annual 
report  shall  be  in  lieu  of  all  other  reports  required  by  any  other 
law.  Such  reports  shall  be  ujion  blank  forms  to  be  provided  by  the 
Auditor  of  Public  Accounts  [Insurance  Supei'intendent] ,  and  shall 
be  verified  under  oath  by  the  duly  authorized  officers  of  such  society, 
and  shall  be  published,  or  the  substance  thereof,  in  the  annual  re- 
port of  the  Auditor  of  Public  Accounts  [Insurance  Superintendent] 
under  a  separate  part  entitled  '"Fraternal  Beneficiary  Societies," 
and  shall  contain  answers  to  the  following  questions: 

1.  Number  of  certificates  issued  during  the  year,  or  members 
admitted. 

2.  Amoimt  of  indemnity  effected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representa- 
tives or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  and  resisted,  and 
brief  statement  of  reasons. 

9.  Does  society  charge  annual  or  other  periodical  dues  or  ad- 
mission fees? 

10.  How  mucli  on  each  $1,000  annually  or  per  capita  as  the  case 
may  be? 

11.  Total  amount  received,  from  what  source  and  the  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  society  guarantee,  in  its  certificate,  fixed  amounts  to 
be  paid  regardless  of  amount  realized  from  assessments,  dues,  ad- 
mission fees  and  donations? 


THE    STATE    OF    ILLIXOIS  145 

I 

14.  It'  so,    stiito   Miiiiiiiiit    niKiranlccMl.    ;iii(l    the    security    of  such 

guaranty. 

15.  lias  the  society  a  si)ecial  reserve  luiid.' 

16.  If  so,  how  is  it  created,  and  for  what  purpose;  the  amount 
tliei-eof.   and   how   invested? 

17.  Has  the  society  more  ihan  mn-  ehiss  .' 

18.  If  so,  how  many,  and  Ihc  aiunniil  of  nuieiiuiity  in  each? 

19.  Number  of  members  in  each  chiss. 

•20.  If  the  society  is  incorporated,  so  state,  and  give  date  of  or- 
ganization. 

L'l.  If  organized,  under  the  laws  ot  lliis  State,  under  what  law, 
and  at  what  time,  giving  chapter  and  year  and  date  of  passage 
of  the  act. 

22.  If  organized  umhn-  the  laws  of  any  other  State,  province  or 
territory,  state  such  fact,  and  the  date  of  organization  giving 
chapter,  and  year  and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  beneficiary  membership  lapsed  dur- 
ing the  year. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more  than 
one  class,  niunber  in  each  class, 

25.  Names  and  addresses  of  its  president,  secretary  and  treasurer, 
or  corresponding  officers. 

The  Anditor  of  Public  Accounts  [Insurance  Superintendent]  is 
authorized  and  empowered  to  address  any  additional  inquiries  to 
any  such  society  in  relation  to  its  doings  or  condition,  or  any  other 
nuitter  connected  with  its  transactions  relative  to  the  business  con- 
templated by  this  act,  and  such  officers  of  such  society  as  the  Audi- 
tor of  Public  Accounts  [Insurance  Superintendent]  may  require, 
shall  promptly  reply  in  writing,  under  oath,  to  all  such  inquiries. 

Section  4-a.  The  Insurance  Superintendent  may  make  or  eai^se  to 
be  made  an  examination  of  the  condition  and  affairs  of  any  society, 
corporation,  order  or  association,  incorporated  under  the  laws  of 
this  State,  or  having  its  principal  office  in  this  State,  at  least  as 
often  as  once  in  two  years,  and  all  of  the  expenses  of  such  examina- 
tion except  the  salaries  or  compensation  of  the  examiners  shall  be 
paid  by  the  society,  corporation,  order  or  association  examined,  upon 
proper  vouchers  showing  the  amount  and  nature  of  such  expenses 
furnished  to  such  society,  corporation,  order  or  association  by  the  In- 
10 


146  FRATERNAL    SOCIETY    LAW 

suranee  Siiperiutendeut  or  by  such  examiners,  and  that  from  and 
after  Jauuarj-  1,  1908,  every  such  society,  corporation,  order  or 
association  organized  under  the  laws  of  this  State,  shall  annually 
pjiblish  its  annual  statement  within  thirty  (30)  days  after  the  same 
has  been  filed  in  the  office  of  the  Insurance  Superintendent,  such 
publication  to  be  made  in  the  official  publication  or  newspaper,  of 
any  such  societ}'.  order,  corporation  or  association,  and  if  such  so- 
ciety, order,  corporation,  or  association  hasno  official  publication,  then 
in  a  secular  newspaper  of  general  circulation  published  in  the  county 
in  which  such  society,  order,  corporation  or  association  has  its  prin- 
cipal office.  Every  such  society,  corporation,  order  or  association 
not  organized  under  the  laws  of  this  State  but  doing  business  herein 
under  the  provisions  of  this  Act  shall  furnish  to  the  Insurance  Super- 
intendent a  cei-tified  copy  of  such  an  examination  made  by  the 
proper  authority  of  its  own  State,  at  least  once  in  every  two  years, 
if  requested,  or  oftener,  if  requested.  In  case  of  its  failure  to  fur- 
nish said  cei'tified  copy  of  examination  on  request,  then  the  Insur- 
ance Superintendent  may  make  or  cause  to  be  made,  an  exam- 
ination of  any  such  society,  corporation,  order  or  association  so 
failing  as  often  as  he  may  deem  it  necessary,  tlie  whole  cost  of  such 
examination  to  be  paid  by  the  society,  corporation,  order  or  asso- 
ciation so  examined. 

Insurance  Superintendent  to  be  Appointed  as  Attorney  for  Service. 

Section  5.  Each  such  society  now  doing  or  hereafter  admitted 
to  do  business  in  this  State,  and  not  having  its  principal  office 
within  this  State,  and  not  being  organized  under  the  laws  of  this 
State,  shall  appoint  in  writing  the  Auditor  of  Public  Accounts  [In- 
siiranee  Superintendent]  or  his  successor  in  office  to  be  its  true 
and  lawful  attorney,  iipon  whom  all  lawful  process  in  any  action 
or  proceedings  aigainst  it  maj^  be  served,  and  in  such  writing  shall 
agree  that  any  lawful  process  against  it  which  is  served  on  said 
attorney  shall  be  of  the  same  legal  force  and  validity  as  if  served 
upon  the  society,  and  that  the  authority  shall  continue  in  force  so 
long  as  any  liability  remains  outstanding  in  this  State.  Copies  of 
such  certificate  certified  by  said  Auditor  of  Public  Accounts  [In- 
surance SuiMU'intondentl  sliall  bo  deemed  sufficient  evidiuice  thereof. 


THE    STATE    OF    ILLINOIS  I4.7 

and  shall  be  admitted  in  evidence  with  the  same  force  and  effect  as 
the  original  thereof  might  be  admitted.  Service  upon  such  attorney 
shall  be  deemed  sufficient  service  upon  such  "society.  When  Icual 
process  against  such  society  is  served  upon  said  Auditor  of  I'ublii- 
Accounts  [Insurance  SiiperinteiidentJ,  he  shall  immediately  notify 
the  society  of  such  service  by  letter,  prepaid  and  directed  to  its 
secretary  or  corresponding  officer,  and  shall,  within  two  days  after 
such  service,  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him  to  such  officer.  The  plaintiff'  in  such  process  so 
served  shall  pay  to  the  Auditor  of  Public  Accounts  [Insurance 
Sui)erintendentJ  at  the  time  of  such  service  a  fee  of  $3,  whicli 
shall  be  recovered  by  him  as  part  of  the  taxable  costs,  if  he  pre- 
vails inthe  suit.  The  Auditor  of  Public  Accounts  [Insurance  Super- 
intendent] shall  keep  a  record  of  all  processes  served  upon  him, 
which  record  shall  show  the  day  and  hour  when  such  service  was 
made. 

Application  to  Continue  Bvisiness. 

.  Section  6.  Any  such  society  now  having  the  right  to  do  business 
within  this  State,  as  provided  by  this  act  desiring  to  so  continue, 
shall  file  with  the  Auditor  of  Public  Accoiuits  [Insurance  Super- 
intendent] an  application  for  permission  to  do  so,  in  which  appli- 
cation shall  appear  the  date  of  organization  or  incorporation,  and 
if  such  society  is  incorporated,  the  name  of  the  State,  province  or 
territoiy  within  which  such  incorporation  was  had,  and  the  chapter 
and  year  and  date  of  the  passage  of  the  act  under  which  such 
society  was  incorporated.  If  siich  society  is  not  incorporated,  such 
fact  shall  be  so  stated  in  the  a])|)]ieat  inu,  and  a  copy  of  the  articles 
of  association  of  such  society,  duly  cei'tified  to  by  its  secretary  or 
corresponding  officer,  shall  accompany  such  applicatiou.  Iipon  re- 
ceipt of  such  a])]ilication,  accompanied  by  a  fee  of  ^'i.  the  Auditor 
of  Public  Accounts  [Insurance  Superintendent]  of  this  State  shall 
issue  to  such  society  a  permit,  in  writing,  authorizing  such  society 
to  do  business  in  this  State. 

Mode  of  Incorporating — Requirements — Certificate  of  Association. 

Section  7.     Any  ten  or  more  persons,  citizens  and  voters  of  this 


148  FRATERNAL   SOCIETY   LAW 

State  may  associati'  themselves  together  for  the  jiiii'pose  of  forming 
a  eorjioratiou  under  this  act:  for  this  i)nrpose  they  shall  make, 
sign  and  acknowledge,  before  an.y  officer  authorized  to  take  acknowl- 
edgements of  deeds  in  this  State,  a  certificate  of  association,  in  which 
shall  be  stated  the  name  or  title  of  the  proposed  society;  the  object 
for  which  it  was  formed;  the  jilan  of  doing  business  clearly  and 
fully  defined ;  the  name  of  the  board  of  officers  or  managers  for  the 
first  j'ear,  and  manner  of  selecting  their  successors;  the  limit  as  to 
age  of  applicants  for  membership,  which  shall  not  exceed  60  years, 
and  that  medical  examinations  are  required,  and  that  bona  fide 
applications  for  membership  have  been  secured  from  not  less  than 
500  persons  who  have  each  made  application  for  membership  in 
such  proposed  society  and  have  lieen  dul.v  examined  and  recom- 
mended by  a  rejnitable  physician  :  Provided,  Societies  that  only 
provide  for  the  insuring  against  bodil.v  injury,  disablement  or  death 
resulting  frpm  accident,  shall  not  be  required  to  have  medical  ex- 
aminations of  its  members,  and  have  each  deposited  with  the  parties 
asking  such  charter  the  sum  of  one  advanced  assessment  on  each 
$1,000  of  insurance,  or  part  thereof,  jjrovided  for  in  the  plan  of 
organization  of  such  society  as  an  advance  assessment  for  mortuary 
purposes,  which  certificate  of  associations  and  applications,  to- 
gether with  the  certificate  of  some  solvent  bank  or  banks  that  all 
such  advance  mortuary  funds  are  deposited  therein  to  be  turned 
over  lo  the  treasurer  of  a  subordinate  lodge  or  branch  composed  of 
such  a])plicants,  after  the  incorporation  of  such  society,  which  cer- 
tificate of  association  shall  be  filed  with  the  Insurance  Superintend- 
ent, accompanied  b.v  a  fee  of  $10.  If  the  Insurance  Supei'intendent 
siuill  find  after  eai-eful  examinatiou,  that  the  objects  of  the  organ- 
ization and  the  plan  of  doing  business  are  fully  and  definitely  set 
forth,  and  are  clearly  within  the  provisions  of  this  act.  and  that  the 
name  or  title  is  not  the  same,  or  does  not  so  nearly  resemble  the 
titli'  in  use.  as  to  inive  a  tenili'iicx'  to  mislead  tlic  ])ublic.  he  shall  ap- 
prove the  same,  and  sluill  forthwith  issue  a  cerliticate  of  organ- 
ization of  the  societ.v.  Thereupon  said  societ.v  may  proceed  to 
transact  business  according  to  the  plan  of  its  organization.  [As 
amcndi'd   by   an  act   a|)]U-ov(Ml   .May  11.   1!t01.   iu   fdrce  July  1.  1901.] 


THE    HTATE    O/-'    ILLINOIS  149 

How  Articles  of  Association  May  Be  Changed. 

.Section  7^2-  Any  corporation,  association  or  society  organized 
nndor  the  provisions  of  this  act,  amended  by  this  section,  may 
change  its  article  of  association  in  the  manner  prescribed  by  its  own 
rules,  but  no  such  change  shall  lie  of  legal  effect  until  a  certificate 
setting  forth  fully  and  definitely  the  changes  proposed  shall  have 
been  sidjmitted  to  and  approved  by  the  Insurance  Sup(!rintendent 
and  Hied  in  tiie  oflii/c  of  the  Secretai'y  of  State  cUid  a  certified  copy 
thereof  recorded  in  the  office  of  the  recorder  of  deeds  in  the  county 
in  which  the  origiuid  eertificMte  of  association  wms  re('(iril(Ml,  Every 
corjioration,  ;issoei;i1  ion  <>v  society  (n"gani/e(l  li;i\iim'  ailnplcd  snch 
change  in  its  articles  of  association  shall  (•(imply  with  the  |)rovisioiis 
of  this  section  within  sixty  (Oil)  days.  ]  As  amciided  liy  act  aji- 
{iroved  and  in  force  ]\Iny  L'7.  1!)()7.] 

Shall  Not  Have  Paid  Agents. 

Section  8.  Such  societies  shall  not  employ  paid  agents  in  solicit- 
ing or  procuring  members  except  in  the  organizing  or  building  up 
of  subordinate  bodies  or  granting  memliers  inducements  to  procure 
new  members. 

Benefits  Exempt  from  Legal  Process. 

Section  d).  The  money  or  other  benefit,  charity,  relief  or  aid 
to  lie  \rA\d.  provided  or  rendered  by  any  society  authorized  to 
do  business  under  this  act,  shall  not  be  liable  to  attachment 
by  trustee,  garnishee  or  other  process,  and  shall  not  be  seized,  taken, 
appropriated  or  applied  by  any  legal  or  equitable  process,  or  by 
operation  of  law,  to  pay  any  debt  or  liability  of  a  certificate  holder 
or  of  any  beneficiai-y  named  in  a  certificate,  or  of  any  pei'son  who 
may  have  any  right  thereunder. 

Meetings  in  Another  State. 

Section  Id.  Any  such  society  organized  under  the  laws  of  this 
State  vany  provide  for  the  meeting  of  its  legislative  oi'  governing 
body  in  any  other  State,  province  or  territory  wherein  such  societies 


150  FRATERNAL    iSOVlETY    LAW 

shall  have  subonliiuilc  bodies,  and  all  business  that  has  heretofore 
or  may  hereafter  bo  traii.saeted  at  such  meetings  shall  be  valid  in  all 
respects  as  if  such  meeting  was  held  within  this  State,  and  where 
the  laws  of  any  such  society  provide  for  the  election  of  its  officers 
by  votes  to  be  cast  in  its  subordinate  bodies,  the  votes  so  cast  in  its 
subordinate  bodies,  in  any  other  State,  province  or  territory  .shall 
be  valid  as  if  cast  within  this  State:  Provided,  however,  that  in 
all  meetings  held  within  tliis  State  in  any  such  society  organized 
under  this  law  or  heretofore  organized,  no  member  shall  be  allowed 
to  east  more  than  15  votes  by  proxy  on  any  cpiestion  submitted 
therein.     [As  amended  by  act  approved  and  in  force  May  27,  1907.] 

False  Representations — Penalty. 

Section  11.  Any  jierson,  officer,  member  or  examining  physician 
who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent  state- 
ment or  representation,  in  or  with  reference  to  any  application  for 
membership  or  for  the  i)nrpose  of  obtaining  any  money  or  benefit 
in  any  society  transacting  business  under  this  act,  shall  be  guilty 
of  misdemeanor,  and  upon  conviction  shall  be  punished  by  a  fine 
of  not  less  than  $100  nor  more  than  $500,  or  imprisonment  in  the 
covuaty  jail  for  not  less  than  30  days  nor  more  than  one  year,  or 
both,  in  the  discretion  of  the  court  and  any  person  who  shall 
wilfully  make  a  false  statement  of  any  material  fact  or  thing 
in  a  sworn  statement  as  to  the  death  or  disability  of  a  certificate 
holder  in  any  such  society  for  the  purpose  of  procuring  payment 
of  a  benefit  named  in  the  certificate  of  any  such  holder,  and  any 
person  who  shall  wilfully  make  any  false  statement  in  any  verified 
report  or  declaration  under  oath,  required  or  authorized  by  this  act, 
shall  be  guilty  of  perjury,  and  shall  be  proceeded  against  and  pun- 
ished as  provided  by  the  statutes  of  this  State  in  relation  to  the 
crime  of  perjury. 

Visitation — Report — Penalty,  Etc. 

S<'ctioii  12.  All  corporations  to  which  this  act  is  applicable,  with 
their  books,  pajM-i's  and  vouchers,  .shall  be  subject  to  visitation  and 
inspection  by  the  Insurance  Superintendent,  or  such  person  as  he 
may   designate.      'I'lie   Insurance    Su])('rint('udi'iit   may   address    any 


THJ-:    STATK    OF    ILLIXOLS  lyl 

inquifies  to  an\'  swo.h  corporation  in  relation  to  its  doings  or  con- 
dition, or  any  other  matter  connected  with  its  transactions  rehitive 
to  the  business  contemplated  by  this  act.  All  officers  of  such 
corporation  shall  promptly  reply  in  writing  to  all  sucli  iiii|iiiries 
under  the  oath  of  its  president,  secretary  or  other  officers,  if  re- 
quired. 

Any  such  society  refusing  or  neglecting  to  make  tlie  annual  re- 
port, as  provided  in  this  act,  shall  be  excluded  from  doing  business 
within  this  State.  Said  Insurance  Superintendent  must,  within  60 
days  after  failure  to  make  such  report,  or  in  case  any  such  society 
shall  exceed  its  powers  or  shall  conduct  its  business  fraudulently  or 
shall  fail  to  comply  with  any  of  the  j^rovisions  of  this  act,  give  notice 
in  writing  to  the  Attorney  General,  who  shall  immediately  commence 
an  action  against  such  society  to  enjoin  the  same  from  carrying 
(ui  any  business.  And  nny  injuiii'tion  may  bo  granted  upon  proper 
showing  in  any  court  of  competent  jurisdiction  in  this  State.  No 
society  so  enjoined  shall  have  authority  to  continue  business  until 
such  report  shall  be  made  or  overt  act  or  violations  complained 
of  shall  have  been  corrected,  nor  until  the  cost  of  such  action 
be  paid  by  it:  Provided,  The  court  shall  find  that  such  society  was 
in  default  as  charged,  whereupon  the  Insni'ance  Sujjcr- 
intendent  shall  reinstate  such  society,  and  not  until  then  shall 
such  society  be  allowed  to  again  do  business  in  this  State.  Any 
officei",  agent  or  person  acting  for  any  society  or  subordinate  body 
thereof  within  this  State  while  such  society  shall  be  so  enjoined 
or  prohibited  from  doing  business  pursuant  to  this  act  shall  be 
deemed  guilty  of  a  misdemeanor,  and  on  conviction  thereof  shall 
be  punished  by  a  fine  of  not  less  than  .'1>25  nor  more  than  $.500,  or 
by  imprisonment  in  the  county  jail  for  not  less  than  30  days  nor 
more  than  one  year,  or  by  both  fine  and  imprisonment,  in  the  dis- 
cretion of  the  court.  [As  amended  by  an  act  approved  May  27, 
1897.1 

Violations — Penalty. 

Section  13.  Any  person  who  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise,  for  any  society  which  shall  have  failed, 
neglected  or  refused  to  comply  with,  or  shall  have  violated  any  of 


152  FRATERNAL    SOCIETY    LAW 

the  provisions  of  this  act,  or  shall  have  failed  or  neglected  to  pro- 
cure from  the  Insurance  Superintendent  proper  certificate  of  au- 
thority tt)  trausact  business  as  provided  for  by  this  act,  shall  be 
subject  to  the  penalty  provided  in  the  last  preceding  section  for 
the  misdemeanor  therein  specified.  [As  amended  by  act  approved 
June  I'l.  1895.] 

All  Conflicting-  Acts  Repealed. 

Section  14.  All  laws  or  parts  of  |Unvs]  in  contlict  with  this  act 
are  liereby  repealed. 

Emergency. 

Section  1.").  Whereas.  An  emergency  exists,  and  this  act  shall  be 
in  force  frdin  and  after  its  passage. 

An  Act  to  amend  sections  3  and  10  of  an  act  entitled  "An  act  to 
provide  for  the  establishment  of  an  Insurance  Department  and  the 
appointment  of  an  Insurance  Superintendent,"  approved  June 
20,  1893,  in  force  July  1,  1893,  and  to  add  a  section  thereto.  Ap- 
proved April  24,  1899,  in  force  July  1,  1899. 

Section  1.  Be  it  enacted  by  the  People  of  the  State  of  Illinois, 
represented  in  the  General  Assembly:  That  sections  3  and  10  of  an 
act  entitled  ' '  An  act  to  provide  for  the  establishment  of  an  Insurance 
department  and  the  appointment  of  an  Insurance  Superintendent," 
approved  June  20,  1893,  in  force  July  1,  1893.  and  to  add  a  section 
thereto,  be,  and  the  same  is  hereby  amended  to  read  as  follows : 

Section  3.  The  Insurance  Superintendent  shall  possess  and  have 
all  the  powers,  and  he  may  perform  all  the  duties  in  regard  to  the 
business  of  insurance  in  this  State,  which  are  now  attached  by 
law  to  tlio  office  of  Auditor  of  Public  Accoiints  and  the  Attorney 
General. 

And  he  sliail  exercise  the  same  control  over  llie  insurance  com- 
l)aiiics.  Ilicir  (iflieers  ;iiul  agents  in  this  State,  and  shall  collect  from 
tlicni  all  taxes,  fees,  fines  anil  penallies.  ami  may  institut(^  and 
[)f(iseente  in  his  name  all  snits  nnil  do  ;dl  lliinus  heretufore  recpiired 


THE    HTATK    OF    ILLlSOl^  153 

to  be  done  by  the  laws  of  this  State  by  the  Auditor  of  Public  Ac- 
counts and  the  Attorney  General. 

And  the  said  Auditor  of  Public  Accounts  and  the  Attorney  Gen- 
eral are  hereby  relieved  from  miiv  duty  heretofore  imjjosed  upon 
them  by  any  law  of  tliis  .State  in  i-elaticm  thereto,  and  tlir  said 
SuiJerintendent  of  Insurance  fully  authorized  and  empowered,  from 
and  after  date  of  his  appointment  and  qualification  as  such  super- 
intendent, to  perform  the  same. 

Section  10.  All  acts  and  parts  of  acts  in  couHict  with  this  act 
ai'e  hereby  repealed. 

FRATERNAL  BENEFICIARY  SOCIETIES. 

"An  Act  to  regulate  and  control  the  investment  and  safe-keeping- 
of  the  reserve  funds  of  fraternal  beneficiary  societies  and  to  en- 
able such  societies  to  deposit  their  reserve  fund  securities  in  the 
custody  of  the  State  of  Illinois,  and  provide  for  the  registry 
thereof,  and  provide  compensation  therefor,  and  providing  a  pen- 
alty for  the  violation  thereof. ' '  Approved  May  14,  1903,  in  force 
July  1,  1903. 

Section  1.  Be  it  enacted  by  the  People  of  the  State  of  Illinois, 
represented  in  the  General  Assembly :  That  it  shall  be  lawful  for 
any  fraternal  beneficiary  society  organized  or  doing  business  in  this 
State  to  invest  its  funds  or  accumulations  in  the  stocks  or  bonds 
of  the  United  States  or  of  this  State,  or  of  any  county,  city  or  town 
in  this  State,  or  any  national  bank,  or  mortgages  (being  first  lien) 
on  real  estate  being  worth  at  least  twice  the  amount  of  the  money 
loaned  thereon,  and  such  other  securities  only  as  are  approved 
by  the  Insurance  Superintendent  of  this  State. 

Section  2.  It  shall  be  unlawful  for  any  fraternal  beneficiar.y  so- 
ciety to  invest  its  funds  or  accumulations  in  any  other  securities, 
except  as  in  this  act  provided,  and  no  securities  not  in  accordance 
with  the  provisions  of  this  act  shall  be  deposited  or  registered  vmder 
the  provisions  thereof. 

Section  3.  Any  fraternal  benefieiarv  society  organized  in  this 
State  may  deposit  in  the  custody  of  the  State  of  Illinois,  with  the 
Superintendent  of  Insurance,  in  sums  of  not  less  than  fifty  thou- 
sand dollars   ($50,000).  at  any  time,  all  or  any  portion  of  the  se- 


154  FRATERNAL    SOCIETY    LAW 

curities  belonging  to  its  reserve  fund;  and  such  securities,  when  so 
deposited,  shall  be  safely  kept  and  preserved  for  the  use  of  such 
society  under  the  provisions  of  this  act. 

Section  4.  The  Insurance  Superintendent  shall  receive  all  such 
securities  and  shall  register  them  in  the  name  of  the  society  to 
which  they  belong,  in  a  register  kept  for  that  purpose,  and  shall 
indorse  on  each  of  said  securities  tlie  following,  to-wit: 

This  is  the  propertj'  of ,  and  deposited  by  the  said 

society  with  the  Insurance  Superintendent  of  the  State  of  Illinois 
and  held  bj'  him  in  trust  for  the  benefit  and  security  of  the  mem- 
bers of  the  said  society,  pursuant  tn  the  hiws  of  the  State  of  Illinois. 
It  is  not  negotiable  or  transferable  until  withdrawn  from  the  said 
trust,  at  which  time  it  shall  be  indorsed  b.y  the  Insurance  Superin- 
tendent and  by  the  president  and  secretary  of  the  society  before  the 
same  shall  become  negotiable. 

Such  registry  and  indoi-senu>nt  shall  be  public  notice  of  the  own- 
ership of  such  securities  and  the  purpose  for  which  deposited.  The 
Insurance  Superintendent  shall  hold  such  securities  for  the  use  and 
protection  of  the  reserve  fund  of  the  society  depositing  the  same, 
and  shall  permit  such  society,  so  long  as  it  is  solvent,  to  collect 
the  interest  or  dividends  thereon,  and  the  principal  thereof  when 
due.  for  tlie  use  of  its  mortuary  and  reserve  funds,  and  shall  per- 
mit such  society,  whenever  the  receipt  of  its  mortuary  funds  are 
insufficient  to  meet  the  death  and  disability  liabilities  accruing  dur- 
ing any  period  of  sixty  days,  to  withdraw  a  sufficient  sum  in  value 
of  such  securities  to  meet  such  deficiency,  and  shall  permit  any 
such  society,  at  any  time,  to  withdraw  the  whole  or  any  part  of  such 
securities,  upon  depositing  with  the  Insurance  Superintendent  other 
securities  of  the  kind  heretofore  named  and  of  equal  value  with  those 
withdrawn.  And  iipon  the  surrender  of  the  charter  or  the  dis- 
solution of  an.y  such  society  all  of  its  securities  so  deposited  shall 
be  withdrawn,  subject  to  the  payment  of  outstanding  mortuary  and 
disability  liabilities. 

Till'  securities  so  deposited  shall  be  non-negotiable  until  with- 
drawn and  indorsed,  as  provided  in  this  act  and  wlion  withdrawn, 
such  withdrawal  shall  bo  indorsed  thereon,  signed  by  the  Insurance 
Su]icriiili'n(lriil,  and  llic  pri'sidi'iit  and  sccri'tai'v  nf  tlic  sdcicty  to 
which  snidi  seciirit  ies  hidnng. 


THE    STATt!    OF    ILLL\0I8  1;J5 

The  securities  so  deposited  shall  not  be  withdriiwn  at  any  time, 
except  upon  wi-itteu  order  of  the  executive  committee  or  a  board  of 
not  less  than  five  persons  duly  authorized  for  that  purpose,  of  the 
society  to  which  such  securities  belong,  which  order  shall  certify 
to  the  Insurance  Superintendent  the  purpose  of  withdrawal  of  the 
securities  and  the  amount  to  be  withdrawn,  and  shall  be  signed 
by  a  majority  of  such  executive  committee  or  board  and  attested  by 
the  i)resident  and  secretary  of  the  society. 

Section  5.  Each  society  depositing  securities,  as  provided  in  this 
act,  shall  pay  a  vault  and  registration  fee  of  25  cents  per  aiunnn 
for  caeli  sf^l.dOO  (IcpcisitiMJ.  which  shall  l)i'  in  full  lor  all  sn-vices 
rendered. 

Section  (i.  The  Superintendent  ol'  Insurance  is  autluu-ized  antl 
empowered  to  make  and  enforce  such  i'ul(\s  as  are  necessary  for 
the  dejuisit  and  safe-keeping  of  the  securities  deposit(>d  with  him  aiul 
for  carrying'  out  the  provisions  of  tliis  act. 

Section  7.  Any  person  or  officer  who  shall  violate  any  of  the 
provisions  of  this  act  shall  be  guilty  of  a  misdemeanor,  and  upon 
conviction  shall  be  fined  in  a  sum  not  less  than  $500  and  not  to 
exceed  $5,000. 

An  Act  empowering  fraternal  beneficiary  societies  organized  and 
existing  under  and  by  virtue  of  the  laws  of  the  State  of  Illinois, 
to  create,  maintain  and  operate  as  a  part  of  their  organization, 
a  department  for  the  purpose  of  providing  and  furnishing  to  their 
sick,  disabled  and  distressed  members  and  their  families,  free 
medical,  home,  sanitorium  and  hospital  service  and  treatment,  and 
other  material  aid  and  assistance,  and  to  create,  maintain  and  dis- 
burse for  such  purposes,  a  trust  fund  to  be  raised  by  and  from 
voluntary  contributions,  and  declaring  such  departments  to  be 
charitable  institutions,  and  competent  as  such  to  be  named,  and 
to  take,  as  beneficiary  by  its  members  in  certain  cases. 

Section  1.  Be  it  enacted  by  the  People  of  the  State  of  Illinois, 
represented  in  the  General  Assembly :  That  any  fraternal  beneficiary 
society  organized  and  existing  under  and  by  virtue  of  the  laws  of 
the  State  of  Illinois,  adopting  the  benefit  of  this  Act.  in  the  manner 
provided  herein,  may  create,  maintain  and  operate  as  a  part  of  its 


156  FRATERXAL    HUCIETY    LAW 

organizatiou,  a  dcpai-tinciit  for  the  piiri)ose  of  providing  and  furiiish- 
iug  to  its  sick,  disabled  and  distressed  members  aud  their  families, 
free  medical,  home,  sanitorinm  and  hospital  service  and  treatment, 
and  such  other  material  aid  and  assistance  as  may  be  provided  by 
such  society  in  its  laws,  and  the  by-laws,  rules  aud  regulations  gov- 
erning such  department,  and  for  such  purposes  such  societies  may 
own,  hold  and  lease  real  property  and  suitable  buildings  necessary 
to  carry  out  any  of  the  aforesaid  objects  and  purposes,  and  create, 
maintain  and  disburse  a  special  fond. 

Section  2.  Such  special  fund  shall  be  created  and  maintained 
by  and  from  voluntary  gifts,  contributions  or  payments  made  by  the 
subordinate  lodges  of  such  societies,  or  by  the  individual  members 
thereof,  or  both,  upon  such  terms  and  conditions  as  may  be  pre- 
scribed in  and  by  the  by-laws,  rules  aud  regulations  adopted  by 
the  lioard  of  directors  or  managers  of  such  department,  and  by 
and  from  such  contributions  from  the  expense  fund  of  such  society 
as  may  be  authorized  by  the  board  of  officers,  managers  or  gov- 
erning body  of  such  society. 

Section  3.  Such  special  fund  shall  be  used  exclusively  for  the 
pnriio.ses  for  which  it  is  created,  and  shall  constitute  a  trust  fund 
for  such  purposes.  The  expense  of  maintaining  and  operating  such 
department  shall  be  borne  by,  and  paid  from  such  special  fund,  and 
such  fund  and  all  the  property  of  such  department  shall  be  held 
free  and  clear  of,  and  shall  not  in  any  manner  be  used  for.  or  be 
or  become  charged  with,  or  liable  for,  the  payment  of  any  claims, 
debts  or  liabilities  of  such  society;  nor  shall  such  society  or  any 
other  of  its  funds  or  property,  in  any  manner  be  used  for,  or  be 
or  become  charged  with,  or  liable  for,  the  payment  of  any  of  the 
claims,  debts  or  liabilities,  or  expense  of  maintaining  or  operating 
such  department,  except  to  the  extent  of  the  contributions  from 
the  expense  fund  of  such  society  authorized  in  manner  provided  by 
section  two  of  this  Act. 

Section  4.  The  board  of  ofiicers.  managers  or  governing  bod\'  of 
any  fraternal  lieneficiary  society  organized  and  existing  under  and 
by  virtue  of  the  laws  of  the  State  of  Illinois,  desiring  to  accept 
the  benefit  of  the  jirovisions  of  this  Act  on  behalf  of  such  society, 
shall  adopt  a  resolution  to  that  eft'ect.  and  )irovide  for  the  creation 
of  a  (lr|i;irlniciit  of  such  society  under  the  name  thercMii  designated, 


THE    HTATE    OF    ILLINOIS  ■     137 

aii<_l  .sliali  then  siilunit,  sueli  resolution  to  :i  vote  of  ;ill  the  suljordi- 
nate  lodges  oi'  sueli  society,  and  on  I'eceiviiig  the  affirmative  votes 
of  not  less  than  two-tliirds  of  siieh  lodges  thereon,  the  provisions  of 
this  Act  shall  be  thereby  extended  over,  and  this  Act  shall  be  in 
force  and  effect  in  such  society  wlien  tlie  provisions  of  section  five 
of  this  Act  shall  be  complied  with. 

Section  5.  Any  fraternal  beneficiary  society  organized  and  exist- 
ing under  and  by  virtue  of  the  laws  of  the  State  of  Illinois,  may 
accept  the  benefit  of  the  provisions  of  this  Act  in  manner  provided 
by  section  four  hereof,  but  such  action  shall  not  be  of  legal  effect 
until'  a  certificate  subscribed  and  sworn  to  by  the  president,  and 
attested  by  the  secretary  of  such  society  under  its  corporate  seal, 
setting  forth  the  terms  of  the  resolution,  and  the  manner  in  which 
it  was  submitted  to  vote,  together  with  the  result  of  the  vote  thereon, 
shall  have  been  sulnnitted  to  and  be  approved  bj'  the  Insurance 
Superintendent,  and  filed  in  the  office  of  the  Secretary  of  State, 
and  a  certified  copy  thereof  lie  recorded  in  tlii'  office  of  the  Recorder 
of  Deeds  in  the  county  in  which  the  certificate  of  incorporation  of 
such  society  was  recorded.  Every  such  society  having  complied 
with  the  provisions  of  section  four  of  this  Act  shall  comply  with 
the  further  provisions  of  this  section,  within  ninety  tlays  thereafter. 

Section  6.  The  management  and  operation  of  such  department 
shall  be  exercised  by  a  board  of  directors  or  managers  of  not  less 
than  nine  members,  as  shall  be  provided  by  the  by-laws  of  such 
department,  and  the  officers  shall  consist  of  a  president,  secretary 
and  treasurer  and  such  other  officers  and  agents  as  shall  be  deter- 
mined by  the  directors  or  managers,  and  the  directors  or  managers 
may  adopt  by-laws,  rules  and  regulations,  which  shall  ])rovide  for 
the  government  of  the  officers  and  the  affairs  of  such  department, 
and  the  terms  and  conditions  upon  Avhich  the  benefits  thereof  shall 
be  furnished,  but  such  by-laws,  rules  and  regulations  before  the 
same  shall  be  of  foi-ee  and  effect,  shall  first  receive  the  approval 
of  the  executive  or  managing  committee  of  such  societv.  Tlie  di- 
rectors or  managers  may  require  of  the  officers  and  agents,  bonds 
with  siich  sureties  and  conditions  as  they  shall  deem  proper.  The 
officers  shall  hold  their  respective  offices  for  the  terms  provideil  by 
the  by-laws. 


15y  FRATERNAL    SOCIETY    LAW 

Section  7.  Each  such  department,  when  organized  in  manner 
provided  by  this  Act.  is  hereby  declared  to  be  a  charitable  insti- 
tution, with  all  the  rights,  benefits  and  privileges  given  to  charitable 
institutions  under  and  bj^  the  Constitution  and  laws  of  the  State 
of  Illinois,  and  such  department  is  hereby  declai-ed  to  be  compe- 
tent to  be  named  and  to  take  as  beneficiary  in  and  by  the  benefit 
certificate  of  any  member  of  such  society  having  no  wife  or  children 
living,  under  the  provisions  of  the  laws  of  the  State  of  Illinois 
relating  to  fraternal  beneficiary  societies. 

Approved  May  -20.  ^W1. 

An  Act  defining-  who  may  become  delegates  or  who  shall  have  any 
voice  in  the  management  of  or  legislate  for  any  Fraternal  Insur- 
ance Society  doing  business  in  the  State  of  Illinois. 

Section  1.  Be  it  enacted  by  the  People  of  the  State  of  Illinois, 
represented  in  the  General  Assembly :  That  it  shall  be  unlawful  for 
any  person,  other  than  a  beneficiary  nieml)er  to  bo  elected  delegate, 
or  shall  have  any  voice  in  the  management  of  the  endowment  or 
mortuary  features  or  business  of  any  fraternal  insurance  society 
doing  business  in  the  State  of  Illinois. 

Section  2.  All  fraternal  insurance  societies  doing  business  in 
the  State  of  Illinois  shall  amend  their  by-laws  so  as  to  comply  with 
the  requirements  of  section  1  on  or  before  the  first  day  of  January, 
1910. 

Section  3.  Any  fraternal  insurance  society  failing  to  comply  with 
the  requirements  of  this  Act  shall  be  prohibited  from  doing  business 
in  this  State,  and  it  shall  be  the  duty  of  the  Superintendent  of 
Insurance  to  revoke  the  license  of  any  fraternal  insurance  society 
not  incorporated  under  the  laws  of  this  State,  and  if  incorporated 
uiuler  the  laws  of  this  State,  to  enjoin  them  from  further  continuing 
business,  until  the  requirements  of  the  provisions  of  this  Act  are 
complied  with. 

Ajiprovi'd  May  23,  lf)07. 

Suicide  by  Strangulation  Proved  from  Circumstances. 

In  an  aelioii  on  a  certificate  ]iroof  1hat  the  diMil  1)ody  of  the 
plaint  ilV's  Inisliand  was  rniiiKJ   liMimiiiL:'  1iy  a   rope  ai'onnd  his  ne(>k. 


THE    STATE    OF    ILLINOIS  159 

together  with  the  proofs  of  death  offered  li\'  the  plaintiff  herself, 
wherein  it  is  stated  tliat  the  immediate  cause  of  death  was  strangu- 
lation by  hanging  himself,  tends  to  prove  the  presumptions  of  the 
defendant's  special  plea  that  the  death  of  the  assiii-cil  resulted  from 
his  own  act,  and  uuless  overcome  by  contrary  j)roof.  the  fact  of  the 
member's  suicide  is  established. 

Kiesewetter   vs.    Supreme    Teut    Knishts    of    the    Maccabees    of   the 
World,  April,  1907,  227  111.  48. 

Suicide — Insanity  no  Defense  Where  Contract  Excepts  Suicide,  Sane 
or  Insane. 

Counsel  for  the  ])laintiff  offered  to  prove  liy  witnesses  ''that  the 
deceased  came  to  his  death  while  insane,  tliat  his  mind  was  in 
such  a  condition  of  insanity  and  frenzy  that  he  was  not  aware  at 
the  time  of  his  death  of  the  physical  consequences  of  his  act  in  the 
taking  of  his  life  at  that  time."  The  offer  was  objected  to.  and 
the  objection  sustained,  and  the  rule  of  the  trial  court  in  this  re- 
gard approved  by  the  supreme  court. 

Kiesewetter    vs.    Supreme    Tent   Knights    of    the    Maccabees    of   the 
World,  April,  1907,  227  111.  48. 

Service  of  Summons  on  Insurance  Superintendent  Not  Exclusive 
Method  of  Serving  Society. 

The  purposes  of  the  fraternal  beneficiary  act  of  the  State  recpiir- 
ing  foreign  benefit  societies,  doing  business  in  this  State,  to  appoint 
the  Superintendent  of  Insurance  as  its  attorney  in  fact  for  service 
of  process,  is  not  to  make  service  of  process  upon  such  attorney  in 
fact  the  exclusive  method  of  obtaining  jurisdiction  of  societies,  but 
to  secure  an  agent  for  service  of  process  whose  agency  cannot  be 
disputed,  and  to  prevent  such  societies  from  avoiding  service  of  pro- 
■  cess  by  withdraAving  its  other  agents  from  the  State. 

Supreme  Hive,  Ladies  of  the  Maccabees  of  the  World  vs.  Harrington, 
April,  1907.  227  111.  511. 


160  FRATERNAL    SOCIETY    LAW 

Service  of  Summons — Limited  Powers  of  Municipal  Court  of  Chicago. 

The  municipal  court  of  the  city  of  Chicago  cannot  obtain  juris- 
diction of  a  suit  against  a  foreign  society  hy  sending  its  process 
outside  of  the  territorial  limits  of  the  city  of  Chicago,  and  obtain- 
ing service  of  the  same  upon  the  Sujierintendent  of  Insurance. 

Supreme  Hive,  Ladies  -of  tlie  Maccabees  of  the  World  vs.  Harrington. 
April,  1907,  227  HI.  511. 

Contracts — Construction  to  Favor  Purposes  of  Society. 

The  rules  and  by-bnvs  of  a  fraternal  society  are  to  be  construed 
liberally  so  as  not  to  defeat  the  purp)oses  of  the  inilemnity  offered 
to  members,  and  in  construing  such  rules,  equivocal  expressions  are 
to  be  interpreted  most  strongly  against  the  societ.v. 

The  Switchmen's  Union  of  North  America  vs.  Colehouse,  .Tune.  1907. 
227  111.  561. 

Provisions  Requiring  Bringing  Suit  in  Limited  Time,  Valid. 

Before  a  society  can  plead  in  bar  the  provision  of  a  b,v-la\v.  re- 
cpiiring  suit  to  be  brought  within  6  months  from  the  rejection  of 
the  member's  claim  bj'  the  grand  lodge,  it  must  be  alleged  that  the 
member  had  notice  of  such  rejection  for  that  length  of  time  before 
bringing  suit. 

The  Switchmen's  Union  of  North  America  vs.  Colehouse,  June,  1907, 
227  111.  561. 

State  Laws  Not  Retroactive  Nor  Do  They  Affect  Certificates  Al- 
ready Issued. 

The  act  of  1893  relating  to  assessment  societies  does  nut  appl,\' 
to  societies  in  existence  when  the  act  was  passed,  unless  the.v  take 
the  steps  provided  in  Section  6  of  that  act,  to  reincorporate  under  its 
provisions,  and  contracts  issued  by  the  society  prior  to  the  passage 
of  the  act  will  not.  therefore,  he  affected  by  l!u^  act.  unless  the 
societ.y  has  taken  the  steps  to  reincorporate. 


THE    STATE    OF    ILLINOIS  161 

Crawford   vs.   Northwestern   Traveling  Men's  Ass'n,   February,  1907, 
226  111.  57. 

True  Rule  as  to  What  State  Laws  are  Part  of  Contract. 

The  rule  tluit  the  law  writes  into  every  contract  the  provisions  of 
the  statutes  that  are  applicable  to  the  transaction  refers  only  to 
statutes  existing  at  the  time  the  contract  was  made,  and  not  to  sub- 
sequent statutes  such  as  would  operate  to  impair  the  contract.  The 
case  at  bar  was  an  assessment  society  case,  and  not  a  fraternal 
societ.v  case. 

Crawford   vs.   Northwestern   Traveling  Men's  Ass'n,   February,  1907, 
226  111.  57. 

Society  May  Obtain  Certain  Benefits  of  State  Laws  Without  In- 
creasing its  Obligations  on  Existing  Contracts. 

Changing  the  constitution  and  by-laws  of  an  assessment  societ.v 
organized  under  the  act  of  1872.  so  as  to  create  an  emergency  fund, 
provided  for  in  the  act  of  1893,  does  not  render  the  provisions  of 
the  act  of  1893  a  part  of  the  contract  of  a  member  who  joined  the 
society  prior  to  such  action,  where  no  steps  were  taken  to  reincor- 
porate under  the  act  of  1893. 

Crawford   vs.   Northwestern   Traveling   Men's  Ass'n.   February,   1907, 
226  111.  57. 

Contract  Capable  of  Two  Constructions  Must  be  Held  to  Favor  Bene- 
ficiary. 

A  contract  of  insurance  is  to  be  construed  liberall.v  in  favor  of  the 
insured,  and  strictl.v  against  the  insurer,  and  where  two  interpreta- 
tions, each  equally  reasonable,  are  po.ssible,  that  construction  should 
be  adopted  which  will  enable  the  beneficiary  to  recover. 

Grand    Legion    of    Illinois    Select    Knights    of    America    vs.    Beaty, 
December,  1906,  224  111.  346. 

11 


162  FRATERNAL    SOCIETY    LAW 

Beneficiary  Has  No  Vested  or  Assignable  Interest  During  Life  of 
Member. 

During  the  lifetime  of  a  member  the  beneficiary  has  no  vested 
interest  in  the  certificate  of  a  member,  where  the  member  may 
appoint  another  beneficiary  in  the  absence  of  any  contractual  rights, 
and  may,  without  the  consent  of  the  beneficiary  entirely  destroy  his 
or  her  interest  in  the  certificate. 

Grand    Legion   of    Illinois    Select    Knights    of    America    vs.    Beaty, 
December,  1906,  224  111.  346. 

Suicide — No  Defense  Unless  Provided  for  in  Contract. 

If  a  contract  is  silent  as  to  the  effect  upon  the  rights  of  the  parties 
of  a  member's  act  of  self-destruction,  recovery  can  be  had  on  the 
certificate  if  the  member  suicides.  The  court  discusses  various 
authorities  upon  this  proposition,  and  concludes  "That  the  act  of 
the  member  of  a  fraternal  beneficiary  society,  who  intentionally 
takes  his  own  life,  while  sane,  does  not  defeat  the  right  of  his  bene- 
ficiary, who  is  his  wife,  to  recover  the  benefit  named  in  the  certifi- 
cate, where  the  contract  of  insurance  is  silent  as  to  the  effect  on 
the  rights  of  the  parties  under  such  act  of  self-destruction." 

Grand    Legion    of    Illinois    Select    Knights    of    America    vs.    Beaty, 
December,  1906,  224  111.  346. 

Assessments— Printing  and  Mailing  Notices  Required. 

"Where  the  constitution  of  a  society  provides  that  printed  notices  of 
assessments  shall  be  sent  by  the  grand  recorder  in  such  manner 
as  the  grand  lodge  may  provide,  and  further  provides  that  the 
official  organ  of  the  society,  published  and  printed  on  the  1st  day  of 
each  month,  shall  be  an  official  notice  of  assessments  to  each  mem- 
ber, it  is  necessary  in  order  to  charge  the  member  with  notice  to 
show  that  a  notice  was  not  only  published.  l)nt  sent  to  such  mem- 
ber. 

Grand    Legion    of    Illinois    Select    Knights    of    America    vs.    Beaty, 
December,  1906,  224  111.  346. 


THE  STATE  OF  ILLINOIS  163 

Release  on  Part  Payment — Valid  Only  in  Compromise  Cases. 

A  release  in  i'lill.  wliile  cxccutecl  by  tlir  hciietieiai'v  iindei-  a  bene- 
fit certifieate,  iipiui  aeeeplanee  ef  a  part  of  the  amount  of  the  cer- 
tificate eaniiol  lie  made  the  basis  of  a,  plea  of  accord  and  satisfaction 
in  a  suit  on  the  certificate,  where  there  was  no  hon<'st  difference 
whatever  between  tlu'  pai'ties  as  to  the  amount  due.  which  was  fixed 
by  the  terms  of  the  certificate. 

Farmers'  and  Mechanics'  Life  Ass'n  vs.  Caine,  December,  1906,  224 
III.  599. 

Release — Accord  and  Satisfaction. 

Acceptance  by  a  creditor  from  a  debtor  of  an  amount  less  than  the 
amoiuit  due,  in  full  satisfaction  of  a  liquidated  and  inKlis])uted  debt, 
is  not  a  discharge,  except  in  so  much  of  the  debt  as  equals  the 
amount  received,  and  it  is  not  essential  to  the  creditor's  right  of 
action  that  he  rescind  the  contract  of  settlement,  or  return  the  money 
received,  but  only  that  he  give  the  debtor  credit  for  the  amount  paid. 

Farmers'  and  Meclianics'  Life  Ass'n  vs.  Caine,  December.   1906.  224 
111,  599. 

Waiver  of  Contract  Provisions. 

By  entering  into  a  parole  contract  extending  the  time  of  payment 
of  the  assessments,  a  society  waives  the  right  to  have  the  evidence 
of  its  action  reduced  to  writing,  as  provided  in  the  contract,  and 
waives  the  right  1o  insist  u])on  forfeiture  foi-  noniiaynient  of  the 
assessments  at  the  time,  as  tlu>y  were  due  under  the  terms  of  the 
original  contract. 

Farmers'  and   Mechanics'   Life  Ass'n  vs.  Caine.   December.   190fi.  224 
111,  599. 

Suicide — After-enacted  Law  Valid  and  Binding  on  Existing  Con- 
tracts. 

A  by-law  of  a  benefit  society  providing  that  "  Tf  any  member  shall 


164  FRATERNAL    SOCIETY   LAW 

die  by  his  own  act  or  hand,  sane  or  insane,  his  beneficiary  or  bene- 
ficiai'ies  shall  receive  only  one-half  of  the  face  value  of  his  benefit 
certificate,"  is  valid  and  binding  as  to  a  member  who  was  admitted 
to  the  society  before  the  adoption  of  the  by-law,  and  who  had  agreed 
in  his  contract  to  be  bound  by  all  by-laws  then  in  force  or  thereafter 
adopted.  The  court  in  this  ease  reaffirmed  the  same  doctrine  an- 
nounced by  it  repeatedly,  and  quoted  the  language  employed  in  the 
ease  of  FuUenwider  vs.  Royal  League.  180  111.  621,  viz.:  "The  con- 
tract required  full  compliance  with  auj'  by-laws  that  might  be 
thereafter  enacted,  and  if  the  certificate  were  accepted  with  such  a 
clause  therein,  there  is  no  vested  right  of  avoiding  the  contract  if 
the  certificate  remained  unchanged,  because  the  recognition  of  the 
power  named  under  the  by-law.s  is  necessarily  a  recognition  of  the 
right  to  repeal  or  amend." 

Scow   vs.    The   Supreme   Council   Royal    League.    October,    1906,    223 
111.  32. 

After-enacted  Suicide  Law^  Reasonable. 

An  after-enacted  by-law  provided  that  there  shall  be  no  liability 
in  the  event  of  the  suicide  of  the  member,  sane  or  insane,  is  valid 
and  reasonable. 

Scow   vs.    The   Supreme   Council   Royal    League,    October,    1906,    223 
111.  32. 

Taxation — Property  of  Fraternal  Societies  Subject  to, 

A  legislature  lias  no  power  to  exempt  from  taxation  any  property 
other  than  that  enumerated  in  Section  3  of  Art.  9  of  the  Constitu- 
tion, since  such  enumeration  is  exclusive  of  all  other  subjects  of 
exemptions,  and  the  properly  of  fraternal  societies  is  not  included  in 
such  an  enumeration. 

Supreme  Lodge  Fraternal  Order  vs.  Board  of  Review.  October.  1906. 
.223  111.  54.     ^ 

Fraternal  Societies  Not  Public  Charities. 

Benefit    societies    are    not    institutions    of    imblic    charities,    since 


THE  STATE  OF  ILLINOIS  165 

they  issue   contracts  of  insurance,  based  upon   valuable  considera- 
tions, and  which  are  legal  and  enforeable  at  law. 

Supreme  Lodge  Fraternal  Order  vs.  Board  ot  ReviRW,  Oc-tober,  1906. 
223  111.  54. 

Taxation — Statutes  Exempting  Fraternal  Societies  Unconstitutional. 

The  provisions  of  the  statutes  exempting  from  taxation  money  col- 
lected by  fraternal  societies  and  on  hand  within  this  State,  and  used 
exclusively  for  the  purposes  of  such  societies,  is  unconstitutional. 

Supreme  Lodge  Fraternal  Order  vs.  Board  of  Review,  Octoter,  1906, 
223  111.  54. 

Construction  to  Be  Given  to  Ambiguous  Designation  of  Beneficiary. 

Where  an  applicant  for  membership  requests  tliat  the  benetit  be 
paid  to  the  applicant's  wife,  and  there  is  an  unsigned  note  upon  the 
back  of  the  application  directing  that  the  benetit  be  paid  to  the 
applicant's  adopted  daughter,  naming  her,  and  the  certificate  when 
issued  makes  the  benefit  payable  to  the  adopted  daughter  as  per  the 
latter  direction,  which  certificate  is  accepted  by  the  applicant  in 
writing,  and  assessments  paid  by  the  member  without  objection ;  the 
adopted  daughter  must  be  held  to  be  the  equitable  beneficiary. 

Murphy  vs.  Nowack.  October,  1906,  223  111.  301. 

Beneficiary — Dependency — Adopted  Child  Is. 

A  child  taken  by  a  member  and  his  wife  from  a  home  for  orphans 
when  she  was  three  years  old,  and  from  that  time  forward  was 
treated  as  a  daughter,  is  a  dependent  during  the  period  of  her  minor- 
ity, or  so  long  thereafter  as  the  assumed  relation  of  parent  and 
child  continues  and  her  support  is  furnished  by  such  member,  and 
she  is  eligible  to  be  named  as  a  dependent  of  the  member. 

Murphy  vs.  Nowack,  October,  1906,  223  111.  301. 


166  FRATERNAL   SOCIETY   LAW 

Conflict  Between  Charter  and  Statutory  Provisions  Regarding  Bene- 
ficiaries. 

If  the  certificate  of  a  society  is  narrower  than  the  statute  under 
which  the  society  is  organized,  and  excludes  from  the  chiss  of  eligi- 
ble beneficiaries  persons  who  would  otherwise  be  eligible  under 
the  statute,  the  certificate  of  organization,  and  not  the  statute  will 
control. 

Murphy  vs.   Nowak,  October,   1906,  223   111.  301. 

After-enacted  Laws  Valid  and  Change  Existing  Contracts. 

If  a  member  of  a  society  agrees  in  his  contract  that  he  will  con- 
form to  the  laws,  rules,  and  usages  of  the  society  then  in  force,  or 
which  may  subsequently  be  adopted,  subsequent  statutes  and  by- 
laws may  be  given  a  retrospective  effect. 

Murphy  vs.   Nowak,  October,   1906.  223   111.  301. 

Beneficiary — Eligibility  at  Maturity  of  Contract  Determines  Right, 

A  person  who  does  not  come  within  any  of  the  designated  classes 
of  eligible  beneficiaries  at  the  time  of  the  death  of  the  member, 
cannot  take  as  beneficiary,  and  in  such  case  the  fund  should  be 
paid  to  the  member's  heirs  at  law  who  are  within  the  class. 

Murphy  vs.   Nowak,  October,  1906,   223   111.  301. 

Beneficiary — Dependent  at  Member's  Death  Determines  Eligibility 
of. 

AVhere  by-laws  of  a  society  preclude  payment  of  the  benefit  to 
an\-  pei-son  who  is  a  dependent,  unless  the  dependency  exists  at 
the  time  of  the  member's  death.  ;nul  rc(|uii-es  written  proof  of  that 
fact,  one  who  was  a  dependent  upon  the  member  for  a  number  of 
years,  but  was  not  dependent  upon  him  for  support  at  the  time  of 
his  death,  was  not  entitled  to  take  the  benefit,  though  named  as 
beneficiary  in  the  certificate. 

Murphy  vs.   Nowak,  October,  1906.  223  111.  301. 


THE  STATE  OF  ILLINOIS  167 

Beneficiaries — Eligibility     of — Societies    May    Restrict    Statutory 
Classes. 

It  is  settled  law  that  when  the  statute  under  which  a  society  is 
organized,  and  its  charter  adopted  in  pursuance  of  such  statute 
designates  certain  classes  of  persons  as  those  for  whom  a  benefit 
fun^l  is  to  be  accumulated,  a  person  joining  who  belongs  to  other 
than  one  of  such  classes,  is  not  entitled  to  take  the  fund,  and  that 
the  corporation  has  no  authority  to  create  a  fund  for  other  persons 
than  the  classes  specified,  nor  can  a  member  direct  a  t\md  to  be  paid 
to  a  person  outside  of  such  classes,  but  there  is  nothing  illegal  or 
against  public  policy  in  the  action  of  a  society  in  narrowing  the 
scope  of  its  beneficial  action  and  in  determining  the  classes  who 
can  take  as  beneficiaries,  the  court  will  look  alone  to  the  certificate 
of  organization  and  not  to  the  statute  under  which  the  society  is 
organized,  which  may  be  broader  in  its  terms  than  the  certificate  of 
organization  of  the  society  organized  thereunder. 

Murphy  vs.  Nowak,  October,  1906,  223  III.  301. 

Suicide,  Sane  or  Insane  An  Excepted  Risk. 

Suicide  by  a  member  of  a  fraternal  society  precludes  a  recovery 
by  the  beneficiary  regardless  of  whether  sane  or  insane  at  the  time, 
or  of  the  degree  of  his  insanity,  where  both  the  application  for  mem- 
bership and  the  by-laws  of  the  society  specify  that  no  benefits  shall 
be  |)aid  if  death  results  from  the  member's  voluntary  or  involuntary 
suicidal  act,  whether  sane  or  insane  at  the  time. 

Zerulla  vs.  Supreme  Lodge  Order  of  Mut.  Protection.  December,  1906, 
223  111.  518. 

Agency  of  Local  Lodge  Officers. 

Where  all  that  a  delinquent  member  has  to  do  to  be  reinstated,  if 
in  good  health,  is  to  pay  his  dues  to  the  collector  of  the  local  lodge, 
the  latter  must  be  regarded  as  the  agent  of  the  supreme  lodge  in 
the  matter  of  accepting  the  dues  and  reinstating  the  member  in 


168  FRATERNAL    SOCIETY    LAW 

good  standing,  notwithstanding  the  provisions   of  its   constitution 
and  by-laws  to  the  contrary. 

Court  of  Honor  vs.  Dinger,  April.  1906.  221  111.  17C. 

Good  Health — Definition  of. 

Good  health  was  defined  in  an  instruction,  approved  by  the 
supreme  court,  as  follows : 

"The  words  'good  health'  when  applied  to  a  human  being  mean 
that  the  person  said  to  be  in  good  health  is  in  a  reasonable  good 
state  of  health,  and  that  he  is  free  from  any  disease  or  illness  that 
tends  seriously  or  permanently  to  weaken  or  impair  the  constitu- 
tion." 

Court  of  Honor  vs.  Dinger,  April,  1906,  221  111.  176. 

Good  Standing — Societies'  Books  Not  Only  Evidence. 

The  books  of  a  society  are  not  the  only  evidence  of  the  good 
standing  of  its  members. 

Bolles  vs.  Mutual  Reserve  Fund  Life  Ass'n,  April,  1906,  220  111.  400. 

Consolidation — Transfer  of  Membership  to  Another  Society. 

Upon  the  approval  of  a  contract  of  transfer  of  the  membership 
of  one  society  to  another  by  two-thirds  of  the  members  of  the  trans- 
ferring society,  all  of  the  members  in  actual  good  standing  in  the 
transferring  society  become  members  in  the  transferee  society  with- 
out any  further  act  upon  their  part,  unless  they  elect  to  be  trans- 
ferred to  some  other  society;  one  who  does  not  participate  in  the 
meeting  where  a  vote  is  had  upon  the  question  of  transferring  the 
membership  from  the  one  society  to  another,  is  not  to  be  regarded  as 
a  party  to  the  contract  of  transfer,  in  the  sense  that  he  is  precluded 
from  questioning  its  terms. 

Bolles  vs.  Mutual  Reserve  Fund  Life  Ass'n.  April,  1906,  220  111.  400. 


THE  STATE  OF  ILLINOIS  169 

Public  Charged  With  Notice  of  Limited  Power  of  Societies. 

One  who  deals  with  a  corporation  having  as  a  matter  of  public 
law  limited  or  delegated  powers,  is  chargeable  with  notice  of  these 
powers  and  their  limitations,  and  cannot  plead  ignorance  of  their 
existence. 

Steele  vs.  The  Fraternal  Tribunes,  April,  1905,  215  111.  190. 

Ultra  Vires  Contracts — Neither  Party  Estopped  to  Assert. 

If  a  contract  with  a  corporation  is  beyond  the  powers  conferred 
upon  it  by  existing  laws,  neither  the  corporation  nor  the  other  part}' 
to  the  contract,  by  accepting  it  or  acting  upon  it  can  be  estopped 
from  raising  the  defense  of  ultra  vires. 

Steele  vs.  The  Fraternal  Tribunes,  April,  1905,  215  111.  190. 

Age  of  Applicant — No  Estoppel  Under  Ultra  Vires  Contract. 

A  society  organized  in  this  State,  whose  by-laws  and  charter  pro- 
hibit the  taking  in  of  a  member  of  over  51  years  of  age,  cannot  be 
bound  by  a  certificate  issued  to  a  person  over  that  age,  even  though 
some  of  the  oiScers  of  the  local  lodge  knew  that  the  applicant's 
representation  of  age  in  the  application  as  51  years  of  age,  and 
warranted  to  be  true,  was  false. 

Steele  vs.  The  Fraternal  Tribunes,  April,  1905,  215  111.  190. 

Ultra  Vires  Contract  Cannot  be  Ratified. 

On  the  question  as  to  the  power  to  ratify  an  ultra  vires  contract, 
this  is  said:  "It  is  insisted,  however,  that  even  though  the  contract 
be  regarded  as  ultra  vires,  yet  defendant  in  error  cannot  avail  itself 
of  such  defense,  the  contract  having  been  performed  in  good  faith 
by  the  other  party,  and  the  corporation  had  the  full  benefit  of  such 
performance.  We  cannot  agree  with  this  contention.  A  contract 
of  a  corporation  which  is  ultra  vires  in  the  true  sense  of  that  term ; 
that  is  to  say,  outside  the  power  of  its  creation,  as  defined  by  the 


170  FRATERNAL   SOCIETY   LAW 

laws  of  its  organization,  and  therefore,  beyond  the  powers  conferred 
upon  it  by  the  legislature,  is  not  only  voidable,  but  wholly  void,  and 
of  no  legal  effect.  The  objection  to  the  contract  here  is  not  merely 
that  the  corporation  ought  not  to  have  made  it,  but  that  it  could 
not  lawfully  make  it.  The  contract  could  not  be  ratified  by  either 
party,  because  it  could  not  have  been  authorized  b.v  either.  No 
performance  by  the  parties  could  give  the  unlawful  contract  valid- 
it.y,  or  become  the  foundation  of  any  right  of  action  upon  it." 

Steele  vs.  The  Fraternal  Tribunes.  April,  1905,  215  111.  190. 

Agency  May  Be  Implied  from  Adopted  Acts  of  Agent. 

The  existence  of  the  agency  of  a  local  official  may  be  implied  or 
established  by  ratification  and  adoption  of  the  acts  done  by  the 
alleged  agent. 

The  Fraternal  Army  of  America  vs.  Evans,  June,  1905,  215  111.  629. 

Seven  Years  Absence — Presumption  of  Death. 

The  unexplained  absence  of  a  person  from  his  usual  place  of  abode 
for  seven  continuous  years,  and  from  whom  no  intelligence  has  been 
received  within  tluit  time,  raises  the  presumption  of  death,  upon 
which  the  jury  may  act  where  no  sufficient  facts  or  circumstances 
are  proven  to  overcome  the  presumption.  For  instructions  given  to 
the  jury  and  approved  by  the  court,  see 

Policemen's  Benevolent  Ass'n  vs.  Ryce,   December,   1904,   213   111.  1. 

Obligations  of  Member  Not  Affected  by  Society 's  Unauthorized  Act. 

An  unauthorized  attempt  on  the  part  of  a  society  to  make  a 
change  in  a  member's  contract  of  a  character  detrimental  to  him, 
does  not  release  the  member  of  his  obligation  to  pay  as  provided  in 
the  original  contract. 

National  Council  Knights  and  Ladies  of  Security  vs.  Dillon,  Decem- 
ber, 1904.  212  111.  320. 


THE  STATE  OF  ILLINOIS  171 

Ultra  Vires — Defense  of  Not  Available  Where  Performed  Contract  is 
Within  Charter  Powers. 

A  society  which  has  received  the  benefit  of  a  contract  may  be 
estopped  to  raise  the  defense  of  iiltra  vires,  wliere  the  contract  is 
within  the  charter  powers  of  the  society. 

Wood  vs.  Supreme  Ruling  of  the  Fraternal  Mystic  Circle,  December, 
1904,  212  111.  532. 

Organic  Law — Definition  of. 

In  Illinois  the  charter  or  organic  law  of  a  society  consists  of  the 
certificate  of  organization  granted  to  it  by  the  State,  and  the  statutes 
which  provide  for  the  organization  of  snch  societies  and  define  their 
powers. 

Wood  vs.  Supreme  Ruling  of  the  Fraternal  Mystic  Circle,  December, 
1904,  212  111.  532. 

Constitution  May  be  Waived  Same  as  By-law. 

A  by-law  adojited  by  a  society  fixing  the  age  limit  of  members,  al- 
though designated  as  part  of  the  constitution,  may  be  waived,  if 
there  is  no  provision  of  the  organic  law  of  the  society  prohibiting 
persons  who  are  not  within  such  age  limit  from  becoming  members. 

Wood  vs.  Supreme  Ruling  of  the  Fraternal  Mystic  Circle,  December, 
1904,  212  111.  532. 

Statutes  of  Foreign  State — Presumptions  as  to. 

In  the  absence  of  proof,  it  will  be  presumed  that  the  statutes  of 
a  foreign  State  governing  the  organization  and  specifying  the  pow- 
ers of  fraternal  societies,  contain  restrictions  limiting  the  age  of  the 
persons  who  may  become  members. 

Wood  vs.  Supreme  Ruling  of  the  Fraternal  Mystic  Circle.  December, 
1904,  212  111.  532. 


172  FBATERNAL    SOCIETY    LAW 

Suicide — "Commit  Suicide" — Application  of  Term. 

lu  passing  upon  a  suicide  provision  in  a  contract,  where  suicides 
in  general  terms  were  expected  from  the  risk,  but  the  usual  sane 
or  insane  clause  was  not  incorporated,  the  court  said:  "Under  such 
provisions  in  the  certificate,  only  the  return  of  the  amount  which 
had  been  paid  into  the  benefit  fund  could  be  recovered  if  the  insured 
while  in  the  possession  of  his  ordinary  reasoning  faculties  intention- 
ally took  his  own  life,  but  that  if  his  reasoning  faculties  were  so  far 
impaired  that  he  was  unable  to  appreciate  the  moral  character, 
genei-al  nature,  consequences,  and  efi'eet  of  the  act  of  self-destruc- 
tion, or  that  he  was  impelled  thereto  by  an  insane  impulse,  which 
he  had  not  the  power  to  resist,  the  entire  amount  of  the  mortuary 
benefit  might  be  recovered;  that  is,  we  hold  that  the  words  'com- 
mit suicide'  were  applicable  to  a  case  of  voluntary,  intentional  self- 
destruction,  the  act  of  a  sane  mind." 

Supreme  Council  Royal   Arcanum  vs.  Pels.  April,   1904.  209   111.   33. 

Suicide — "Insane  Impulse,"  Definition  of. 

"One  may  have  sufficient  mental  power  to  form  the  intention  to 
do  the  physical  act  which  will  result  in  death,  and  also  intend  to 
bring  about  that  result  by  such  act.  yet  if  he  is  driven  to  the  forma- 
tion of  that  intention  and  the  commission  of  the  act  by  an  insane 
impulse,  whi^^h  lie  has  not  the  power  to  resist,  and  which  overwhelms 
his  moral  nature,  his  death  is  not  regarded  as  a  voluntary  and  inten- 
tional act  of  self-destruction,  but  as  though  it  were  the  result  of 
accident  or  of  some  irresistible,  external  force." 

Supreme  Council  Royal  Arcanum   vs.   Pels.  April.   190-1.   209   111.   33. 

Beneficiary — Murder  of  Member  by — Forfeits  Rights  of. 

WunliT  of  the  iTisuri'd  by  a  beneficiary  named  in  the  certificate 
precludes  a  recovery  by  such  beneficiary,  but  does  not  absolve  the 
society  from  payment  of  the  amount  of  the  certificate  to  any  person 
whomsoever  in  the  absence  of  a  provision  of  the  contract  to  that 
effect. 


THE  STATf:   OF  ILLINUIH  173 

Suiireme  Lodge  Knights  anil  Ladies  of  Honor  vs.  Menkliausen.  A|)ril, 
1904,  209  111.  277. 

Beneficiary — Heirs  at  Law  Take  Where  Member  Murdered  by  Bene- 
ficiary. 

The  heii's  ;it  law  of  a  iiii'nil)or  wlui  was  iiuirilci'i'd  by  a  liriirliriary 
are  entitled,  if  within  the  class  of  eligible  beneficiaries,  to  recover 
under  a  certificate  issued  to  the  member,  in  the  absence  of  anything 
to  the  contrary  in  the  contract  or  the  laws  of  the  State  and  as 
against  tlie  beneficiary  named  in  tlie  certificate. 

Supreme  Lodge  Knights  and  Ladies  of  Honor  vs.  Menkhausen,  April, 
1904,  209  ni.  277. 

Beneficiary — Failure  of  Designated — Order  of  Heirship. 

Where  the  law  determines  the  persons  entitled  to  insurance  on  the 
life  of  a  member,  suit  may  be  brought  in  the  name  of  such  persons,, 
and  not  by  the  administrator  of  the  estate  of  the  deceased  member. 
The  fraternal  act  of  the  State  contemplates  that  the  children  of  a 
member  shall  stand  next  in  order  to  the  .surviving  hu.sband  or  wife, 
where  the  beneficiary  named  is  disqualified  to  take.  The  statute- 
construed  liy  the  court  in  tliis  particular  provides  for  benefits  to  be 
paid  to  the  "families,  heirs,  blood  relations,  affianced  husband  or 
affianced  wife  of  or  to  persons  dependent  upon  a  member,"  but  this 
provision  was  by  the  court  considered  in  connection  with  somewhat 
similar  pi'ovisions  in  jircviou.s  acts  of  the  legislature. 

Supreme  Lodge  Knights  and  Ladies  of  Honor  vs.  Menkhausen,  April,. 
1904,  209  111.  277. 

Guardian  Has  no  Power  to  Compromise  Wards'  Claim. 

A  guardian  has  no  power,  without  an  express  order  of  the  court, 
to  make  any  settlement  of  the  ward's  interest  under  a  certificate  for 
less  than  the  full  amount,  and  has  no  power  or  autlun-ity  to  make 
admissions  that  will  be  adverse  to  his  ward's  interest. 


Knights    Templars"    and    Masons'    Life    Indemnity    Co.    vs.    Crayton. 
.Tune.  1904,  209   111.  550. 


174  FRATERNAL    SOCIETY   LAW 

Minors  Upon  Obtaining  Majority  May  Sue  in  Cases  Where  Guardian 
Compromised  Claims. 

A  release  of  liability  inidei'  a  certificate  given  by  the  guardian  of 
an  infant  beneficiary,  upon  the  payment  by  the  society  of  a  less 
sum  than  the  face  of  the  contract  issued  to  the  member,  whom  the 
society  regarded  as  having  committed  suicide,  is  not  a  bar  to  a  suit 
on  the  certificate  where  the  society  was  liable  for  the  amount  of  the 
contract,  whether  the  member  suicided  or  not,  and  minors  upon  ob- 
taining their  majority  are  not  precluded  from  bringing  suit  to 
recover  the  full  amount  of  the  contract,  by  reason  of  the  fact  that 
their  guardian  acting  without  the  authority  of  the  probate  court 
made  a  settlement  with  the  society  under  the  certificate. 

Knights    Templars'    and    Masons'    Life   Indemnity   Co.    vs.    Crayton, 
June,  1904,  209  111.  550. 

"Satisfactory  Proofs  of  Death" — Definition  of. 

Satisfactory  proof  of  death  within  the  meaning  of  the  certificate 
means  satisfactory  proofs  that  the  insured  is  dead,  and  reasonable 
proof  as  to  the  cause  of  death,  bi;t  such  proofs  are  not  binding  upon 
either  the  society  or  the  beneficiaries  when  the  cause  of  death  be- 
comes a  disputed  (juestion  between  them. 

Knights    Templars'    and    Masons'    Life    Indemnity   Co.    vs.    Crayton. 
June.  1904.  209   111.  550. 

Proofs  of  Death — Coroner's  Verdict  Admissible  in  Evidence. 

A  verdict  of  a  coroner's  jury  attached  to  the  proofs  of  death  ma.v 
be  considered  by  ttie  jury  in  determining  the  cause  of  the  member's 
death,  but  neither  the  proofs  of  death  nor  the  testimony  taken  upon 
the  coroner's  inquest  can  be  considered  "ii  that  subject,  unless  the 
statements  contaiiu>d  in  the  jiroofs  of  death  are  against  interest,  and 
made  by  persons  eompetcnl  lo  bind  Ihemselves,  aiul  infants  are  not 
within  that  class. 


Knights    Templars'    and    Masons'    Life    Indemnity    Co.    vs.    Crayton, 
June.  1904,  209  111.  550. 


THE  UTATE  OF  ILLINOIS  175 

Taxation — Benefit  Certificates  are  Subject  to. 

CV'i-tificates  issued  by  benefit  societies  are  taxable  as  credit  after 
the  death  of  the  persons  wliose  lives  were  insured,  notwithstanding 
proofs  of  death  had  not  been  made,  nor  the  time  expired  within 
which  the  societj'  might  be  sued  to  recover  under  the  certificates, 
and  in  assessing  such  certificates  for  taxation,  they  are  presumed  to 
be  worth  their  face  value. 

Cooper  vs.  Board  of  Review,  February,  1904,  207  111.  472. 

Evidence — Opinions  of  Physician  in  Suicide  Cases. 

A  physician  called  as  an  expert  in  an  action  on  a  certificate  ma.v 
give  his  opinion  as  to  whether  under  the  facts  in  evidence,  the  death 
of  the  insured  was  caused  by  sti-angulation.  where  such  physician 
has  seen  several  cases  of  hanging,  or  has  read  upon  the  question  in 
medical  works. 

Supreme  Tent  Knights   of  the  Maccabees  vs.   Stensland,   December, 
1903,  206  111.  124. 

Proofs  of  Death,  Statements  in,  May  be  Denied  by  Beneficiary, 
Though  Beneficiary  Offered  Proofs  in  Evidence. 

A  beneficiary  who  signed  without  reading  sworn  proofs  of  death, 
prepared  by  the  society's  agent,  may  introduce  such  proofs  in  evi- 
dence upon  the  question  of  notice,  and  if  no  element  of  estoppel  is 
present,  may  after  having  established  proper  notice,  give  evidence 
contradicting  the  statements  made  such  proofs,  to  the  effect  that 
the  death  of  the  member  was  caused  by  self-destruction. 

Supreme  Tent  Knights  of  the  Maccabees  vs.   Stensland,   December, 
1903.  206  111.  124. 

Estoppel— Definition  of. 

It  is  essential  to  equitable  estoppel  that  one  party  has  by  his 
conduct  wilfully  misrepresented  a  material  fact  with  the  intention 
of  inducing  the  action  of  another  person,  who  relying  upon   such 


IIQ  FRATERNAL   SOCIETY   LAW 

representations,  in  ignorance  of  their  falsity,  has  so  changed  his 
position  that  he  would  suffer  loss  if  the  false  conduct  were  repudi- 
ated. 

Supreme  Tent  Knights  of  the  Maccabees  vs.   Stensland,   December, 
1903,  206  111.  124. 

Suicide — Burden  of  Proof  on  Society  Always. 

If  a  society  files  a  special  plea,  alleging  that  a  member  suicided 
in  violation  of  the  contract,  the  society  has  the  burden  of  establishing 
such  fact,  notwithstanding  the  proofs  of  death  introduced  in  evi- 
dence by  the  plaintiff  contained  an  admission  that  the  member  sui- 
cided, which  makes  a  prima  facie  case  of  suicide,  but  which  the  plain- 
tiff' seeks  to  overcome  by  introducing  contradictory  evidence. 

Supreme  Tent  Knights  of  the  Maccabees   vs.   Stensland,   December, 
1903,  206  111.  124. 

Total  Disability — Definition  of. 

One  who  has  power  to  use  his  hands  at  labor  for  a  brief  time  only, 
and  not  for  a  sufficient  time  to  make  the  result  any  benefit  to  him  in 
the  way  of  making  a  living  is  ''totally  incapacitated  from  perform- 
ing manual  labor"  within  the  meaning  of  a  benefit  certificate,  pro- 
viding for  the  paj'ment  of  indemnity  to  one  in  such  condition. 

Grand  Lodge  Brotherhood  of  Locomotive  Firemen  vs.  Orrell,  Decem- 
ber, 1903,  206  111.  208. 

Society  as  to  Funds  a  Mere  Trustee. 

The  members  of  a  society  and  those  persons  named  in  the  statute 
bearing  certain  relations  to  them  are  the  beneficiaries  of  all  funds 
realized  by  the  society,  and  it  stands  as  the  trustee  handling  the 
funds. 

Knights  Templars'  and  Masons'  Life  Indemnity  Co.  vs.  Vail,  Decem- 
ber,  1903,  206  111.  404. 


THE  STATE  OF  ILLIXOIS  177 

Society  Limited  as  to  Right  to  Collect  Funds. 

A  society  is  not  authorizod  to  eollcet  funds  from  the  membership 
by  way  of  dues  or  assessments  in  excess  of  the  amount  necessary 
to  pay  death  losses,  indemnities,  and  the  legitimate  and  reasonable 
expenses  of  eonduetini;-  tlic  business  of  tlie  society  in  the  absence  or 
authority  in  the  organic  law  so  to  do. 

Knights  Templars'  and  Masons'  Life  Inrlemnity  Co.  vs.  Vail,  Decem- 
ber, 1903,  206   111.   404. 

Assessments^Surplus  Fund  May  be  Applied  to. 

If  the  constitiition  of  a  society  provides  that  the  surplus  funds 
shall  be  used  without  notice  in  payments  of  assessments,  and  the 
evidence  shows  that  such  a  surplus  exists,  a  member  can  main- 
tain his  right  to  the  application  of  the  fund  upon  his  unpaid  assess- 
ments. 

Knights  Templars'  and  Masons'  Life  Indemnity  Co.  vs.  Vail,  Decem- 
ber, 1903.  206  111.  404. 

Surplus  Fund — Rights  of  Members  in. 

The  acceptance  by  a  member  of  a  bond  containing  provisions 
which  are  not  in  accord  with  the  constitution  of  the  society,  does 
not  operate  to  change  his  interest  under  the  constitution  and  benefit 
cerificate  in  the  surplus  fund  against  which  the  bond  was  issued, 
where  there  is  no  question  of  estoppel  in  the  action. 

Knights  Templars'  and  Masons'  Life  Indemnity  Co.  vs.  Vail,  Decem- 
ber.  1903.  206  111.  404. 

Suicide — Burden  on  Defendant  to  Establish  by  a  Preponderance  of 
the  Evidence. 

A  defendant  in  an  action  on  a  benefit  certificate  has  the  burden 
of  establishing  by  a  preponderance  of  the  evidence  the  defense  that 
the  insured  committed  suicide. 
12 


178  FRATERNAL    SOCIETY    LAW 

Rumbold   vs.    Supreme   Council   Royal    League,   February,   1904,    206 
111.  513. 

Benefit  Fund  Exempt  From  Debt,  Dvity  of  Society  Upon  Beingi 
Garnisheed. 

It  i.s  the  duty  of  a  society  if  funds  in  its  bauds  belongiug  to  a 
beneficiary  are  garnisheed  to  interpose  the  exemption  created  by  the 
beneficiary  act  of  1893,  and  it  is  not  optional  with  the  society  whether 
it  will  interpose  the  defense  or  suffer  judgment. 


Rumbold   vs.    Supreme   Council   Royal   League.   February,   1904, 
111.  513. 


206 


Suicide — Presumptions  Against. 

"The  law  is  of  course  well  settled  that  suicide  is  not  presumed,  but 
that  the  presumption  is  death  from  natural  or  accidental  causes 
rather  than  suicide,  and  au  instruction  that  makes  the  test  the 
presence  or  absence  of  some  other  cause  than  suicide  would  seem 
to  be  a  reversal  of  the  test." 


Rumbold   vs.    Supreme   Council   Royal   League,   February.   1904,    206 
111.  513. 


Assignment  of  Fund  Under  Certificate  Valid. 

Contingent  interests  and  expectancies,  although  not  assignable  at 
law,  may  be  transferred,  and  when  assigned  will  be  enforced  equity, 
if  the  contract  was  made  in  good  faith  and  for  a  valuable  considera- 
tion. The  contract  in  this  case  was  a  benefit  certificate  issued  by  the 
Royal  Temjilars  of  Temperance. 

Jarvis  vs.  Binldey,  February,  1904,  206  111.  541. 

Beneficiary  May  Assign  Expected  Benefit, 

The  provisions  of  the  statute  and  of  the  charters  of  benefit  so- 
cieties exempting  benefit  funds  from  liability  for  debts  of  a  deceased 
member  have  no  application  to  the  voluntary  act  of  a  beneficiary  in 


THE  STATE  OF  ILLINOIS  179 

assigning   her   interest   iu   a   certificate   to   secure   payment   of  her 
bona  fide  iudebteduess. 

Jarvis  vs.  Binkley,  February,  1904,  206  III.  541. 

Benefit  Fund  Assigned,  Enforcement  of  in  Equity. 

^Vn  assigumout  by  a  beueHciary  of  lier  contingent  interest  iu  a 
benefit  certificate  to  secure  payment  to  the  assignee  of  groceries  and 
supplies  furnished  by  liiui  to  tlic  l)eneficiary  before  and  after  the 
assignment  may  be  iuforced  in  equity  after  sucli  interest  has  vested, 
notwitlistanding  the  charter  of  the  society  and  the  laws  of  the  State 
limits  the  benefit  fund  to  members  of  the  family,  bldod  relations,  and 
dependents  of  members. 

Jarvis  vs.  Binldey,  February,  1904,  206  111.  541. 

Suicide     "Sane  or  Insane"  Clause  Valid — Insanity  no  Defense. 

A  clause  in  a  benefit  certificate  providing  against  liability  if  the 
(insured  "shall  die  by  his  own  hand,  whether  sane  or  insane,"  was 
held  to  be  a  complete  exemption  from  liability  iu  case  of  the  suicide 
of  the  member,  notwithstanding  the  fact  that  he  was  wholly  insane 
and  totally  incapable  of  understanding  the  physical  nature  and 
efilect  of  his  act.  The  court  with  much  industry  reviewed  the  leading 
authorities  upou  the  question  at  bar,  but  summed  up  its  ruling  in  the 
following  language :  "In  the  case  at  bar  the  replication  admits  the 
cause  of  death,  but  seeks  to  avoid  the  condition  in  the  contract  by 
setting  up  the  insanity  of  the  insured.  It  is  not  denie'd  that  the  in- 
surance company  may  contract  to  avoid  liability  if  death  results 
from  any  disease  of  the  mind,  just  as  it  may  if  death  results  from 
any  bodily  disease,  if  the  contract  is  embodied  in  apt  language. 
Nothing  can  be  clearer  than  that  the  words  'sane  or  insane'  were 
introduced  in  the  certificate  by  the  insurer  for  the  purpose  of  except- 
ing from  its  operation  any  self-destruction  whether  the  insured  was 
of  sound  mind,  or  in  a  state  of  insanity.  There  is  no  qualification 
of  the  varying  degrees  of  insanity,  but  tlie  language  is  simply  'sane 
or  insane.'     These  words  have  a  precise,  definite,  well  understood 


180  FRATERNAL    SOCIETY    LAW 

meauiug.  \"o  reasouable  mind  could  be  misled  by  them,  and  no 
explanation  of  language  could  more  clearly  express  the  intention 
of  the  parties  in  the  construction  of  ordinary  words.  In  a  contract 
thej-  are  to  be  given  a  meaning  which  they  have  to  the  ordinar3^ 
mind,  aiid  to  permit  in  cases  of  this  kind  a  discussion  and  proof  and 
a  differentiation  of  the  degrees  of  insanity  would  be  to  do  violence 
to  words  having  a  generally  accepted  signification,  and  to  do  that 
which  the  parties  themselves  never  contemplated." 

Seitzinger  vs.  Modern  Woodmen  of  America,  October,  1903,  204  111.  .58. 

Incontestable  Clauses  Valid. 

A  clause  in  a  certificate  making  a  certificate  incontestable  for 
fraud  in  procuring  same,  after  a  lapse  of  a  reasonable  period  is 
valid,  as  creating  a  short  statute  of  limitations. 

Royal  Circle  vs.  Aehterrath.  October,  1903,  204  111.  549. 

Construction  of  Contracts  Must  Favor  Member. 

An  incontestable  clause  in  a  benefit  certificate  is  to  be  liberally 
construed  in  favor  of  the  member. 

Royal  Circle  vs.  Aehterrath.  October,  1903,  204  111.  549. 

Good  Standing-  Presumed  to  Continue  From  Date  of  Certificate. 

A  certificate  issued  to  a  member  is  evidence  of  his  good  standing 
at  the  time' of  its  issuance,  and  such  good  standing  is  presumed  to 
continue  until  the   contrary  is  shown. 

Royal  Circle  vs.  Aehterrath.  October,  1903,  204  111.  549. 

Suicide  Not  a  Criminal  Act. 

Suicide  of  a  member  does  not  reinhT  the  certificate  void  under  a 
provision  in  tlie  constitution  makinji-  the  certificate  void  if  death 
results  on  account  of  the  insured  viohiting  any  criminal  law  of  the 
State,  since  suicide  is  not  a  crime  under  the  laws  of  this  State. 


THE  HTATE  OF  IhLlNOlH  181 

Royal  Cii-ile  vs.  Achtei-ratli,  October,  1903,- 204  111.  549. 

Suicide — In  Absence  of  Proof  Sanity  Presumed. 

If  the  proul  sliows  that  a  iiicniluT  couimillcd  siiiridc,  \n\\  there  is 
no  proof  that  be  was  insane,  it  will  be  presumed  that  he  was  sane 
at  the  time  of  the  comiiiissiou  of  the  act.  • 

Royal  Circle  vs.  Achterrath,  October.  1903.  204   111.  549. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

■  A  benefit  society  sent  out  a  circular  letter  to  subordinate  lodges 
denj-iny  liability  on  a  certain  benefit  certificate  upon  the  ground 
of  non-payment  of  an  assessment  and  thereby  waives  its  right  to 
insist  on  failure  to  furnish  proofs  of  death  as  ground  of  forfeiture. 

Supreme  Lodge  Order  of  Mutual  Protection  vs.  Meister,  October.  1903, 
204  111.  527. 

Resort  to  Civil  Courts  Cannot  be  Denied  or  Restricted  to  Beneficiary. 

A  beneficiary  named  in  a  certificate  is  not  bound  to  submit  her 
claim  for  adjudication  to  a  tribunal  provitled  for  in  the  by-laws  of 
the  society  before  instituting  suit  in  the  courts. 

Supreme  Lodge  Order  of  Mutual  Protection  vs.  Meister,  October,  1903, 
204  111.  527. 

Surplus  Fund — Duty  of  Society  to  Apply  Same  to  Prevent  For- 
feiture. 

It  is  not  conscionable  for  a  society  to  forfeit  a  contraet  when  there 
is  in  its  treasurj'  more  than  enough  of  the  members'  money  to  pay 
his  assessment,  but  it  is  its  duty  to  so  appropriate  the  money  in  its 
hands  as  to  prevent  the  member's  forfeiture. 

Supreme  Lodge  Order  of  Mutual  Protection  vs.  Meister.  October,  1903, 
204  III.  527. 


182  FRATERNAL    SOCIETY    LAW 

Society  Bound  by  Acts  of  Chief  Officials. 

A  benefit  society  is  bound  by  the  acts  of  its  president  in  the  ab- 
sence of  any  proof  that  his  ordinary  powers  as  president  were 
abridged  by  the  by-hiws  of  the  society.  Any  act  performed  by  the 
president  pertaining  to  the  business  of  the  society,  not  clearly  for- 
eign to  the  general  power  of  the  president,  will  in  the  absence  of 
proof,  be  presumed  to  have'  been  authorized  by  the  societj^,  as  a 
corporation  acts  through  its  president  and  secretary  in  the  execution 
of  its  contracts  and  agreements. 

Traders'   Mutual    Life   Insurance   Co.   vs.    Johnson,   December,   1902, 
200  111.  359. 

Waiver  of  Right  of  Forfeiture. 

What  facts  will  constitute  a  waiver  is  a  mixed  question  of  law 
and  fact.  If  the  time  for  paying  the  premium  on  a  contract  is  ex- 
tended, the  contract  does  not  lapse,  and  if  the  premium  is  paid 
within  the  extended  period,  it  is  not  necessary  that  the  member  be  in 
good  liealth  at  the  time,  or  that  he  sign  a  cei"tificate  to  that  effect, 
as  is  required  in  the  case  of  renewing  lapsed  certificates. 

Aetna  Life  Insurance  Co.  vs.  Sanford,  Dec.  1902,  200  111.  126,  affirm- 
ing 9S  111.  App.   376. 

Tax,  Illegal  Levy  no  Ground  for  Relief  After  Payment. 

A  tax  imposed  upon  n  life  insurance  concern,  voluntarily  paid, 
cannot  be  recovered  ])uck,  although  illegal,  and  the  fact  that  the  tax 
is  paid  unwilliimly  does  not  coiislitute  duress  or  eomimlsion. 

Yates  vs.  Royal  Insurance  Co.,  Dec.  1002,  200  111.  202. 

Suicide  Provision  Valid. 

A  provision  in  a  contract  providing  that  if  the  insured  suicides, 
whether  sane  or  insane,  1li(>  contract  sliall  be  void,  is  valid. 

Dickerson  vs.  Northwestern   Mutual  Lite   Ins.  Co.,  Dec.  1902,  200  III. 
270,  affirming  102  fll.  App.  280. 


THE  STATE  OF  ILLINOIS  183 

President,  Powers  of. 

A  society  is  boiiiid  by  the  acts  of  its  president,  in  the  absence  of 
any  proofs  that  his  ordinary  powers  as  president  were  abridged  by 
the  by-laws  of  the  society. 

Traders  Mut.  Life  Ins.  Co.  vs.  Johnson,  Dec,  1902,  200  111.  359,  affirm- 
ing 101  111.  App.  559. 

Forfeiture,  When  Not  Self -executing. 

If  there  is  no  provision  in  the  application  for  membership,  the 
certificate  or  the  application  for  reinstatement,  or  any  by-law  to  the 
effect  that  false  representations  in  an  application  for  reinstatement 
shall  render  the  certificate  void,  a  forfeiture  alleged  to  arise  from 
such  cause  is  not  self-executing. 

Traders  Mut.  Life  Ins.  Co.  vs.  Johnson,  Dec,  1902,  200  111.  359,  affirm- 
ing 101  111.  App.  559. 

Assessment  Notice,  Technical  Requirements  of. 

Whei'e  a  by-law  requires  notices  of  assessments  to  bear  the  official 
stamp  of  the  collector  or  the  seal  of  the  council,  a  notice  without 
either  seal  or  .stamp  is  void. 

Cronin  vs.  Supreme  Council  Royal  League,  Dec,  1902.  199   111.   228, 
reversing  101  111.  App.  479. 

Evidence,  When  Member  Incompetent  Witness. 

A  memloer  of  a  fraternal  society  is  incompetent  to  tesifj'  in  behalf 
of  the  society  in  a  suit  on  a  benefit  certificate  by  a  personal  repre- 
sentative of  the  beneficiary. 

Cronin  vs.  Supreme  Council  Royal  League,  Dec,  1902,  199   111.  228, 
reversing  101  111.  App.  479. 


184  FRATERNAL    SOCIETY    LAM' 

Waiver,  Facts  in  Case. 

For  the  facts  iu  a  case  where  waiver  of  a  provision  of  a  contract 
and  liy-law  was  involved,  see 

Covei-dale  vs.  Royal  Arcanum.  Dec,  1902,  199  111.  649. 

Beneficiaries,  Enlarging  Classes  by  Amendments. 

If  a  statute  enlarging  classes  of  beneficiaries  authorizes  existing 
societies  to  continue  business  by  observing  the  provisions  of  the  act 
concerning  annual  reports,  but  provides  that  societies  may  avail 
themselves  of  the  provisions  of  the  act  by  amendment  to  their  con- 
stitution, a  society  already  existing  may  continue  its  business  by 
observing  the  provisions  as  to  annual  reports,  but  cannot  avail  Itself 
of  the  provisions  of  the  act  enlarging  the  class  of  beneficiaries  with- 
out amending  its  charter  to  conform  to  the  statute. 


Grimme  vs.  Grimme.  Oct..  1902,  198   111.  265.  affirming  101   111.  App. 
389. 


Missouri  Statute,  Construction  of. 

Under  the  Missouri  Fraternal  Beneficiary  Act  of  1897,  which  act 
enlarged  the  classes  of  beneficiaries  of  societies,  any  society  doing 
business  in  Missouri  might  continue  doing  business  therein  by  com- 
plying with  the  act  concerning  annual  reports,  without  amending 
its  charter  or  re-incorporating. 

Grimme  vs.  Grimme.  Oct.,  1902,  198  111.  265.  Affirming  101  111.  App. 
389. 

Suicide,  Sane  or  Insane,  Provisions  Valid. 

If  the  contract  provides  that  the  society  shall  not  be  liable  if  the 
member's  death  shall  result  from  his  own  suicidal  act,  whether 
sane  or  insane,  the  society  is  not  liable  where  the  member  volun- 
tarily takes  poison  for  the  )MU'i)ose  of  ending  his  life,  and  with  the 
knowledge  that  such  will  be  the  efi'ect,  and  it  makes  no  diflfereuce 


THE    STATE    OF    ILLI^OIH  185 

that  he  is  moved  thereto  by  ;iii  insane  impulse  or  that  he  is  incapable 
of  forming  a  rational  intent. 

Supreme  Lodge   Order  of  Mutual  Protection  vs.   Gelbke.   Oct.,   1902, 
198  111.  365,  reversing  100  111.  App.  190. 

Taxation,  Funds  of  Fraternal  Societies  Subject  to. 

Laws  exempting  societies  from  taxation  must  be  strictly  con- 
strued, and  no  property  can  be  held  exempt  unless  clearly  within  the 
exemptive  class;  and  a  fraternal  society  deriving  its  funds  from 
assessments  of  members  is  not  entitled  to  exemption  from  taxation 
under  the  revenue  act  of  the  State,  it  not  being  a  charitable  insti- 
tution. 

State  Council   Cath.  Knights  of  Illinois  vs.  Board  of  Review.  Oct., 
1902.  198  111.  441. 

Taxation,  Funds  in  Bank  Belonging  to  Fraternal  Societies  Though 
Drawn  Against,  Subject  to. 

Where  drafts  have  been  drawn  upon  a  benefit  fund  prior  to  April 
1st  to  pay  beneficiaries  of  deceased  members,  but  such  drafts  have 
not  been  paid  out  of  the  fund,  the  fund  nevertheless  is  subject  to 
taxation. 

State  Council   Cath.  Knights  of   Illinois  vs.   Board  of  Review.  Oct., 
1902,  198  111.  441. 

Death  in  Common  Disaster. 

When  two  or  more  persons  i)erish  in  a  common  disaster,  there  is  at 
common  law  no  presumption  of  survivorsship,  and  if  survivorship  is 
claimed  it  must  be  proved,  and  the  party  having  the  burden  of  proof 
must  fail  if  the  proof  cannot  be  made. 

Middeke  vs.  Balder,  Oct..  1902,  198  111.  590,  affirming  98  111,  App.  525. 

Beneficiary  Has  No  Vested  Interest  in  Certificate. 

In  Illinois,  the  beneficiary  named  in  a  certificate  holds  no  vested 


Ib6  FRATERNAL    SOCIETY    LAW- 

interest  in  the  fund,  foi-  the  reason  that  the  same  is  under  the  con- 
trol of  the  member. 

Middeke  vs.  Balder,  Oct.,  1902,  198  111.  590,  affirming  98  111.  App.  525. 

Death  in  Common  Disaster. 

Where  two  or  more  j)erish  in  a  common  disaster,  they  are  treated 
as  all  having  perished  at  the  same  instant,  and  no  one  takes  any- 
thing from  any  of  the  others  by  reason  of  such  others'  death;  and 
where  the  heirs  of  the  beneficiary  have  the  burden  of  proving  that 
the  beneficiary  became  entitled  to  the  fund  by  reason  of  surviving 
the  insured,  if  they  cannot  make  such  proof  the  benefits  will  go 
to  the  heirs  of  the  deceased  member. 

Middeke  vs.  Balder,  Oct.,  1902,  198  111.  590,  affirming  98  111.  App.  525. 

Forfeiture  and  Suspension. 

For  the  facts  in  a  case  where  it  was  alleged  that  the  member  had 
been  suspended  and  that  that  he  was  not  in  good  standing  at  the 
time  of  his  death. 

See  Hunter  vs.  The  National  Union,  June,  1902,  197  111.  478,  affirm- 
ing 99  111.  146. 

Agency — Of  Subordinate  Lodge. 

A  subordinate  lodge  is  the  agent  of  the  supreme  lodge,  and  if  a 
subordinate  lodge,  with  full  knowledge  of  the  falsity  of  the  state- 
ment in  a  member's  application  that  he  had  never  engaged  in  the 
business  of  selling  liquor,  continues  to  receive  assessments  from  him 
and  treats  his  certificate  as  in  full  force  up  to  his  death,  the  right 
to  forfeit  the  certificate  for  the  falsity  of  such  statement  is  waived. 

Coverdale  vs.  The  Royal  Arcanum.  Dec,  1901,  193  111.  91,  reversing 
93  111.  App.  373. 

Foreign  Society,  Rights  of. 

A  society  incorporated  in  a  foreign  State  comes  into  Illinois  not 


THK    H'VA'n<:    OF    IIJJSOIS  1X7 

as  a  matter  of  ley-al  right,  but  only  by  comity,  and  is  siibjuet  to  the 
same  restrictions  and  duties  as  local  corporations  ol'  llic  same  class, 
and  has  no  ^■rcatcr  powers. 

Covei-clale  vs.  The  Royal   Arcaiuim,   Dec,   lyol,   193   111.  91,  reversing 
93  111.  App.  373. 

Contract,  When  Regarded  as  an  Illinois  Contract. 

It'  the  ap])lication  for  membership  is  made  in  Illinois  hy  a  citizen 
and  resident  of  the  State,  and  the  assessments  are  paid  to  a  subordi- 
nate lodge  in  Illinois,  and  the  certificate,  which  specifies  no  place 
of  payment,  is  received  and  accepted  in  Illinois,  the  conti-act  of  in- 
surance is  governed  l)y  the  laws  of  Illinois,  though  the  society  is 
incorporated  in  a  foreign  State  and  the  headquarters  of  the  society 
is  located  in  such  f(n-eign  State. 

Coverdale  vs    The  Royal  Arcanum,  Dec.  1901.  193  111.  91,  reversing 
93  111.  App.  373. 

After-enacted  Laws,  When  Will  They  Impair  Contracts. 

It  is  only  when  a  member  in  express  terms  agrees  to  be  bound 
by  amendments  that  may  thereafter  be  enacted  that  he  is  bound 
by  subserpient  amendments  which  impair  the  obligations  of  his  con- 
tract; and  where  the  certificate  of  a  member  provides  that  he  shall 
comply  with  the  constitution  and  laws,  which  constitution  pro- 
vides that  it  may  be  amended,  it  is  held  that  this  is  not  an  express 
agreement  on  the  part  of  the  member  to  be  bound  by  future  changes 
which   impair  his  contract. 

Peterson  vs.  Gibson.  Oct..  1901.  191  111.  365,  affirming  92  111.  App.  595. 

Mistake,  Acquiescence  of  Member  in  Same. 

In  determining  whether  a  deceased  member  knew  of  and  acqui- 
esced in  a  mistake  made  by  an  official  of  the  society  in  the  names 
of  the  beneficiaries  when  making  out  a  new  certificate,  the  conduct 
of  the  member  in  retaining  the  new  certificate  without  objection  is 


188  FRATERNAL    SOCIETY    LAW 

competent  evidence,  but  so  also  are  his  declarations  tending  to  show 
that  he  did  not  know  of  the  mistake. 

Towlie  vs.  Towne,  Oct.,  1901,  191  111.  478,  affirming  93  III.  App.  159. 

Beneficiaries,  Mistake  of  Member,  Effect  of. 

If  a  member  of  a  society  did  not  read  his  new  certificate  and  did 
not  know  that  a  mistake  had  been  made  therein  cutting;  out  the 
half  interest  of  his  heirs  and  making  his  wife  the  sole  beneficiary, 
the  rights  of  the  heirs  to  have  the  certificate  reformed  after  his 
death  is  not  barred  by  the  mere  fact  of  his  retaining  possession  of 
the  certificate. 

Towne  vs.  Towne,  Oct.,  1901,  191   III.  47S.  affirming  93  111.  App.  159. 
Presumptions,  What  Will  be  Indulged  in. 

In  an  action  upon  a  certificate,  it  is  not  incumbent  upon  the  plain- 
tiff to  prove  the  truth  of  the  statements  in  the  application  or  the 
member's  compliance  with  the  rules  of  the  society,  since  the  falsity 
of  the  statements  or  non-compliance  with  the  rules  is  a  matter  of 
defense;  nor  need  the  plaintiff  prove  the  election  of  the  person  in 
possession  of  the  office  of  secretary  of  the  soeietj^  and  performing 
its  duties. 

Supreme  Lodge.  Bohemian  Knights  vs.   Matf  jowski,  .\pril,  1901,  190 
111.   142.   affirming  92  III.  App.   385. 

Certificate,  Assignable  in  Equity. 

"While  at  law  a  benefit  certificate  is  not  assignable,  in  equity  a 
beneficial  interest  may  be  transferred  therein  which  will  be  pro- 
tected by  a  court  of  chancery. 

McGrew  vs.  McGrew,  .lune,  1901,  190  111.  604,  affirming  93  111.  App.  7G. 

Certificate,  Rights  of  Creditors  in  Equity,  Under  Assignment. 

If  a  member  of  a  society  names  his  daughter  as  beneficiary,  and 


THE    HTATE    OF    ILLINOIS  189 

agrees  with  her  that  upon  his  death  she  shall  receive  out  of  the  pro- 
ceeds of  the  certificate  the  amounts  advanced  by  her  to  him,  he  has 
no  right,  after  the  certificate  is  delivered  and  the  money  paid,  to 
change  his  beneficiary,  notwithstanding  provisions  in  the  laws  to 
the  effect  that  certificates  cannot  be  made  i)ayable  to  a  creditor,  nor 
be  held  wholly  or  in  part,  nor  assigned  to  secure  a  debt  of  the 
member. 

MoGrew  vs.  McGrew,  June,  1901.  190  111.  (!04,  affirming  93  111.  App.  76. 

By-laws  Prohibiting  Members  Going  Into  Saloon  Business,  Reason- 
able. 

A  by-law  which  proliibits  members  from  engaging  in  the  Imsiiies.-; 
of  saloon-keeping  and  forfeits  all  beneficial  rights  of  those  who 
violate  the  provisions  of  the  law,  is  not  unreasonable. 

Moerschbaecher  vs.   Supreme  Council  Royal   League,  Dec,  1900,  188 
III.  9,  affirming  88  111.  App.  89. 

After-enacted  Saloon  Laws  Valid. 

At  the  time  when  the  member  joined  a  society  he  agreed  to  obey 
all  the  laws  then  in  force  and  those  that  might  thereafter  be  en- 
acted. Subsequently  a  by-law  was  adopted  prohibiting  members 
from  engaging  in  the  saloon  business  and  providing  for  forfeiture 
of  their  contracts  if  they  violated  the  law.  Held,  that  the  by-law 
was  valid  and  binding,  and  that  a  memlier  who  violated  it,  though 
not  formally  notified  of  his  violation  and  suspended,  nevertheless 
the  certificate  was  forfeited. 

Moerschbaecher  vs.   Supreme  Council  Royal  Deague,   Dec,  1900,  188 
111.  9,  affirming  88  III.  App.  89. 

After-enacted  Laws  Retroactive  When. 

Even  if  a  certificate  states  that  the  by-laws  are  part  of  the  con- 
tract and  that  they  are  subject  to  amendment,  subsequent  by-laws 
will  be  construed  to  apply  only  to  contracts  made  after  their  adop- 


190  FRATERNAL    SOCIETY    LAW 

tion,  unless  there  is  an  express  agreement  that  the  member  shall  be 
boimd  by  future  by-laws. 

'     Covenant  Miit.  Life  Ass'n  vs.  Kentner.  Dec,  1900.  188  III.  431.  affirm- 
ing 89  111.  App.  495. 

Attachment  of  Fund  for  Debt,  Exemption. 

The  provision  in  the  Frateriial  Act  of  1893  providing  that  "the 
money  to  be  paid  by  any  society  shall  not  be  liable  to  attachment 
or  other  process,  and  shall  not  be  seized,  taken,  appropriated  or 
applied  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any 
beneficiary,"  is  held  to  be  designed  only  to  protect  the  societies 
from  legal  process  by  creditors  of  their  members  or  beneficiaries. 

Martin  vs.  Martin,  Oct..  1900,  187   111.   2(H),  affirming  87  111.  App.  .3G.5. 

Creditors  Rights  to  Fund,  When. 

Money  belonging  to  a  beneficiary  collected  bj^  his  agent  o  na  cer- 
tificate is  liable  to  garnishment  in  the  hands  of  such  agent  by  a 
creditor  of  the  beneficiary,  since  the  x^rovisions  of  the  fraternal  act 
of  the  State  exempting  funds  of  fraternal  societies  from  being  taken 
or  seized  for  the  debts  of  members  or  of  their  beneficiaries  does  not 
apply  to  money  which  has  been  paid  over  by  the  society. 

Martin  vs.  Martin.  Oct.,  1900,  187  111.  200,  affirming  87  111.  App.  36.5: 

After-enacted  Laws  Valid  as  to  Extension  of  Class  of  Beneficiaries. 

An  agreement  by  a  member  to  obey  all  by-laws  in  force  or  subse- 
quently enacted,  subjects  tlie  member  and  his  beneficiary  to  the 
operation  of  a  sulisoquent  by-law  passed  to  carry  into  force  the 
provisions  of  the  statute  restricting  payments  to  the  family  of  the 
member,  his  heirs,  blood  relations,  affianced  wife,  or  persons  de- 
pendent upon  him. 

Baldwin   vs.  Begley.   Ajiril.   liiOO,   18,5    111.   ISO,   distingnishing  Voight 
vs.  Kersten.  164  111.  314.  reversing  84   111.  App.  074. 


TIIK    STATE    OF    ILIJNOIS  191 

Beneficiary — Rights  of  Heirs  at  Law. 

Heirs  iit  law  of  a  iiH'iiil)er  are  entitled  to  the  benefit  where  the 
person  di^sigiinted  as  beiiefieiai-y  is  ontside  the  classes  of  persons 
capable  of  taking  tlie  benefit. 

Baldwin  vs.  Begley,  April,  1900,  18.5   111.  180,   distinguishing  Voight 
vs.  Kersten,  164  111.  314,  reversing  84  111.  App.  674. 

Proofs  of  Death,  Beneficiary  May  Deny  Statements  in  Same. 

A  beneficiary  is  not  e.stop])ed  to  deny  the  truth  of  the  statements 
contained  in  the  physician's  affidavit,  wliich  under  the  rules  of  the 
society  is  part  of  the  proofs  of  death. 

Modern  Woodmen  of  America  vs.  Davis.  Feb.  1900,  184  111.  236,  affirm- 
ing 84  III.  App.  439. 

Evidence,  Proofs  of  Death  Admissible. 

A  physician's  affidavit  as  to  the  cause  of  a  member's  death  is  ad- 
niissil)le  in  evidence  with  other  papers  constituting  proofs  of  death. 

Modern  Woodmen  of  America  vs.  Davis,  Feb.  1900,  184  111.  236.  affirm- 
ing 84  111.  App.  439. 

Mandamus  Proper  Remedy  Against  Superintendent  of  Insurance. 

Mandamus  lies  against  the  Superintendent  of  Insurance  to  compel 
him  to  issue  a  license  to  a  foreign  insurance  concern  where  his 
refusal  to  do  so  is  not  warranted  by  law. 

The  People  vs.  Van  Cleave,  Dec.  1899,  183  111.  330. 

Subordinate  Lodge  Laws  Part  of  Contract. 

The  constitution  of  a  subordinate  lodge  is  a  part  of  the  member's 
contract  of  insurance,  and  where  there  is  no  requirement  that  the 
laws  of  the  subordinate  lodge  must  strictly  conform  to  those  of  the 
society,  which  has  no  transactions  with  the  members  directly,  the 
former  governs  in  cases  of  conflict. 


192  FRATERNAL    SOCIETY    LAW 

Polish  Roman   Catholic   Union  vs.  Warczali,   Oct.,   1899,   182   111.   27, 
affirming  82   111.   App.   351. 

Forfeiture  and  Suspension. 

For  the  facts  in  a  case  where  it  was  alleged  that  the  member  was 
not  in  good  standing  at  the  time  of  liis  death,  see 

Catholic  Order  of  Foresters  vs.  Fitz,  Oct..  1899.  181   111.  206.  affirm- 
ing 81  111.  App.  389. 

Charter  Members '  Rights. 

The  charter  members  of  the  Modern  Woodmen  have  no  rights 
which  are  not  given  to  other  members  of  the  society. 

Park  vs.  Modern  Woodmen  of  America,  Oct.,  1899,  181  111.  214. 

Fraternal  Society  Not  Bound  by  Promoter's  Contract. 

A  benefit  society  is  not  liable,  in  the  absence  of  ratification,  upon 
a  contract  made  by  its  ])rnmoters  before  its  incorporation. 

Park  vs.  Modern  Woodmen  of  America,  Oct..  1899,  181  111.  214. 

Supreme  Lodge,  Powers  of. 

The  principal  olSce  of  a  society  maj-  be  removed  b.y  direction  of 
its  legislative  body  for  the  general  good  of  the  society  and  for  the 
accommodation  of  a  great  majority  of  its  members,  although  all  of 
them  do  not  give  consent  thereto. 

Park  vs.  Modern  Woodmen  of  America,  Oct  ,  1899,  181  111.  214. 

Meetings  Held  Out  of  Home  State  Validated. 

The  legalizing  clause  of  the  Fraternal  Beneficiary  Act  of  1897, 
which  validates  former  action  taken  by  fraternal  societies  at  meet- 
ings held  iiiitsiili'  I  hi'  State,  is  valid  and  not  uiicoiistitntioiial. 

Park  vs.  Modern  Woodmen  of  America,  Oct..  1S99.  1S1   111.  214. 


THE    STATE    OF    ILLINOIS  193 

Amendments  to  Laws,  Reservation  of  Power  When. 

A  certificate  of  membersliip  wliicli  provides  that  the  member  shall 
be  bound  by  the  laws,  rules  and  regulations  then  in  force  or  which 
may  thereafter  be  enacted  by  the  society,  sufficiently  reserves  the 
right  of  a  society  to  amend  existing  laws. 

Fullenwider  vs.  Supreme  Council  Royal  League,  Oct.,  1899,  180   111. 
621,  affirming  73  111.  App.  321. 

After-enacted  Laws,  Reasonable  Increase  of  Rates. 

A  member  has  no  vested  right  to  have  the  rate  of  assessments 
fixed  by  a  by-law  in  force  when  the  contract  was  entered  into,  re- 
main unchanged  where  he  has  agreed  to  be  bound  by  future  enacted 
by-laws;  and  Avhere  the  society  in  such  case  increases  the  assess- 
ment from  $2.62  to  $4.52  per  month,  such  increase  is  not  unreason- 
able, and  the  same  is  valid  where  there  is  no  fraud  or  improper 
motive  established  on  the  part  of  the  society. 

Fullenwider  vs.  Supreme  Council  Royal  League,  Oct.,  1899,  180   111. 
621,  affirming  73   111.  App.  321. 

Supreme  Lodge  Cannot  Delegate  Legislative  Power. 

A  supreme  lodge  cannot  delegate  to  a  board  created  by  it  the 
power  to  pass  a  by-law  forfeiting  the  certificate  of  membership  of 
any  member  whose  death  shall  result  from  self-destruction,  volun- 
tary or  involuntary,  whether  sane  or  insane. 

Supreme  Lodge,  Knights  of  Pythias   vs.    Kutscher,   April,    1899.    179 
III.  340,  reversing  72  111.  App.  462. 

After-enacted  Laws  Valid  Though  Not  Adopted  in  Formal  Way. 

The  adoption  by  the  supreme  lodge  of  an  unauthorized  by-law 
passed  by  a  subordinate  board  renders  such  by-law  effective,  and 
binds  members  who  have  agreed  to  comply  with  by-laws  now  in 
force  or  thereafter  enacted  by  the  supreme  lodge. 
13 


194:  FRATERNAL    SOCIETY    LAW 

Supreme  Lodge,  Knights  of  Pythias  vs.  Kutscher,  April,  1899,  179 
111.  340,  reversing  72  111.  App.  462. 

Constitution  a  Mere  By-law. 

The  constitution  of  a  society  has  the  force  of  a  by-law  only,  and 
cannot  take  away  the  inherent  power  to  adopt  such  other  by-laws  as 
the  charter  permits. 

Supreme  Lodge,  Knights  of  Pythias  vs.  Kutscher,  April,  1899,  179 
111.  340,  reversing  72  111.  App.  462. 

After-enacted  Laws  Binding  and  What  Are  Reasonable. 

A  by-law  forfeiting  claims  for  the  death  of  a  member  by  suicide 
or  intoxication,  is  reasonable  and  binds  members  joining  before  its 
passage  where  their  contracts  require  compliance  with  the  laws  in 
force  and  those  thereafter  enacted. 

Supreme  Lodge,  Knights  of  Pythias  vs.  Kutscher,  April,  1899,  179 
111.  340,  reversing  72  111.  App.  462. 

After-enacted  Laws — Power  to  Violate  Formal  Rules  to  Enact  Laws. 

The  adoption  by  the  supreme  lodge,  by  a  viva  voce  vote,  of  a 
committee  report  approving  a  suicide  by-law  passed  by  a  subordi- 
nate board  without  authority,  is  an  enactment  of  such  law  by  the 
supreme  lodge,  although  its  constitution  provides  another  method 
for  enacting  by-laws,  and  binds  members  whose  contracts  require 
compliance  with  all  laws  now  in  force  or  thereafter  enacted  by  the 
supreme  lodge. 

Supreme  Lodge  Knights  of  Pythias  vs.  Trebbe,  April,  1899,  179  111. 
348,  reversing  71  111.  App.  545. 

Cancellation  of  Certificate. 

An  allegation  that  the  defendant,  in  a  bill  to  cancel  his  certificate 
of  membership  in  a  society,  gave  untrue  answers  to  questions  in  his 
application,  is  not  sustained  where  the  defendant  testifies  that  the 


THE    fiTATE    OF    JlJ.IXOIfi  195 

answers  written  by  the  society's  examining  physician  did  not  corre- 
spond with  those  given  by  the  defendant,  and  that  they  were  not 
read  over  to  liim,  which  testimony  is  nndenied  by  the  examiner 
called  by  the  conii)lHinMnt:  and  in  such  a  ease  where  it  is  sought 
during  the  member's  last  illness  to  cancel  the  eertifieati'.  the  society 
must  prove  substantial  violntion  of  the  terms  of  tlic  contract  as 
alleged  in  its  bill. 

Arnhorst   vs.    National    Union,    June,    1899.    179    111.    4.Sfi.    reversing 
74   111.  App.  482. 

Foreign  Society,  Rights  of. 

A  foreign  corporation  cannot  collect  money  in  Illinois  unless  it 
has  complied  with  the  laws  of  this  State  preserving  the  terms  upon 
which  it  may  transact  business  therein;  and  the  money  paid  by 
membei-s  of  a  local  branch  to  a  local  treasurer,  which  remains  in  his 
possession,  is  the  propcrtj'  of  the  members  of  the  local  branch  as 
individuals,  where  the  society  has  no  authority  to  transact  business 
in  the  State. 

Supreme  Sitting  Order  of  Iron  Hall  vs.  Grigsby,  Feb.,  1899,  17S  111.  57, 
affirming  78  111.  App.  300. 

Construction  of  Act  of  1893 — Assignability  of  Certificate.  ' 

The  act  of  1893  relating  to  fraternal  societies  does  not  apply  to 
certificates  issued  prior  to  a  society's  reorganization  under  that 
act.  T)or  will  its  provisions  govern  the  assignment  of  such  certificate 
in  the  absence  of  anj'thing  to  show  the  assignment  was  made  after 
such  reorganization.  Prior  to  the  passage  of  the  act  of  1893,  an 
assignee  of  a  benefit  certificate  need  not  have  an  insurable  interest 
in  the  member's  life. 

Moore  vs.  Chicago  Guaranlj-  Fund  Life  Society.  Feb.,  1899,  178   111. 
202,  affirming  76  111.  App.  433. 

Beneficiaries,  Class  of  May  be  Restricted, 

A  society  organized  under  the  general  ini'oriioi'atioii  act  prior  to 


196  FRATERNAL    SOCIETT    LAW 

the  passage  of  the  fraternal  beneficiary  act,  not  for  pecuniary  profit, 
may  by  its  certificate  of  incorporation,  laws  and  contracts  restrict 
the  class  of  eligible  beneficiaries,  notwithstanding  the  statute  under 
which  it  is  incorporated  is  broader  in  its  terms. 

Norwegian  Old  People's  Home  Society  vs.  Wilson,  Dec,  1898,  176  111. 
94,  affirming  73  111.  App.  287. 

Beneficiary,  Has  No  Vested  Rights,  Change  of  Beneficiary. 

The  beneficiary  named  in  a  certificate,  from  the  mere  fact  of  such 
naming,  has  no  vested  interest  in  the  certificate,  and  the  member 
may  change  the  beneficiary  at  any  time  in  accordance  with  the 
statute  and  the  laws  of  the  society;  and  in  the  absence  of  any  pro- 
vision of  statute,  laws  of  the  society,  or  the  contract  expressly  au- 
thorizing or  prohibiting  the  change  by  the  member,  the  member  has 
a  vested  right  to  make  such  change  from  the  very  character  and 
purpose  of  the  society  itself, 

Delaney  vs.  Delaney,  Oct.,  1898,  175  111.  187,  affirming  70  111.  App.  130. 

Beneficiaries,  By-laws  Respecting-  May  Be  Waived. 

The  by-laws  of  a  society  with  reference  to  making  changes  of 
beneficiaries  may  be  waived  by  the  society  and  a  new  cei'tificate 
may  be  issued  in  lieu  of  an  old  certificate  in  any  manner  satisfac- 
tory to  the  society  and  the  member. 

Delaney  vs.  Delaney,  Oct.,  1898,  175  111.  187,  affirming  70  111.  App.  130. 

Construction  of  Act  of  1893. 

For  the  facts  in  a  case  and  the  opinion  of  the  court  discussing 
the  Fraternal  Bonoficiary  Act  of  1893,  see 

Lehman    vs.    Clark,    Oct.,    1898,    174    111.    279.   following   Bastian   vs. 
Modern  Woodmen,  166  111.  595. 

Assessments,  Member  Cannot  Be  Sued  for  Same. 

Levying  an   assessment  on  nn   insurance  certificate  in  an  assess- 


THE    STATE    OF    ILLISOIS  197 

ment  society  does  not,  where  the  contraet  is  unilateral,  create  the 
relation  of  debtor  and  creditor  between  the  society  and  the  member, 
and  upon  the  member's  failure  to  pay  the  assessment  when  due, 
neither  the  society  nor  its  receiver  can  enforce  payment  by  suit. 

Lehman  vs.  Clark,  Oct.,   189S,   174   111.  279. 

Agency  of  Subordinate  Lodge. 

The  relation  between  a  subordinate  lodge  and  the  society  is  that 
01  agency,  and  where  forfeiture  of  the  certificate  of  a  member  of  a 
subordinate  lodge  is  sought,  it  may  be  shown  in  defense  that  the 
subordinate  lodge,  with  knowledge  of  the  alleged  cause  of  forfeiture, 
treated  the  insurance  as  in  force,  receiving  dues  and  paying  them 
over  to  the  society. 

High   Court,    Independent   Order  of  Foresters  vs.   Schweitzer,   Feb., 
1898,  171  111.  325,  affirming  70  111.  App.  139. 

After-enacted  Laws,  When  Valid. 

An  agreement  in  an  application  that  the  applicant  shall  be  bound 
and  his  contract  of  insurance  controlled  by  the  laws  then  in  force 
or  which  might  thereafter  be  enacted  by  the  society,  does  not  in- 
clude in  its  terms  a  by-law  subsequently  enacted  by  a  subordinate 
body  of  the  society  which  provides  for  forfeiture  of  the  insurance 
upon  self-destruction  of  the  members. 

Supreme  Lodge  Knights  of  Pythias  vs.  McLennan,  Feb.,  1898,  171  111. 
417,  affirming  69  111.  App.  599. 

Beneficiary,  Right  to  Name  By  Will. 

A  by-law  which  provides  that  "in  the  event  of  the  death  of  all 
the  beneficiaries  designated  by  a  member  in  accordance  with  the 
laws  of  the  order,  upon  the  death  of  such  member,  if  he  shall  have 
made  no  other  disposition  thereof,  the  benefit  shall  be  paid"  to  cer- 
tain designated  persons,  recognizes  the  member's  right,  upon  the 
death  of  his  main  beneficiary,  to  dispose  of  the  benefit  by  will  to 
any  person  eligible  as  a  beneficiary. 


198  FRATERNAL    SOCIETY    LAW 

High  Court  Catholic  Order  of  Foresters  vs.  Malloy,  November,  1897, 
169  111.  58,  affirming  67  111.  App.  665. 

Beneficiary,  Equitable  Rights  May  Be  Enforced  in  Certificate. 

A  member  wlio,  in  consideration  of  a  cash  loan  from  his  wife, 
makes  her  the  beneficiary  in  a  certificate,  which  certificate  is  deliv- 
ered to  and  retained  by  her.  and  upon  which  she  pays  all  the  assess- 
ments required  therein,  cannot  divest  her  rights  therein  by  making 
a  false  afiidavit  that  the  certificate  was  lost  and  thus  procuring 
from  the  society  a  duplicate  certificate,  but  naming  new  beneficiaries ; 
and  while  a  benefit  certificate  is  not  assignable,  rights  may  be  ac- 
quired therein  which  will  be  enforced  in  equitj'.  In  this  case  the 
court  held  that  the  wife  had  a  vested  equitable  interest  in  the 
original  certificate. 

Supreme  Council  Royal  Arcanum  vs.  Tracy,  Nov.,  1897,  169  111.  123, 
affirming   67   111.   App.   202. 

Benefit  Fund  No  Part  of  Member's  Estate. 

A  fimd  arising  from  a  benefit  certificate  is  not  an  asset  of  the 
estate  of  the  deceased,  but  goes  directly  to  the  beneficiary  named 
therein,  and  is  not  payable  to  the  deceased  nor  for  his  benefit,  nor 
is  it  subject  to  his  debts. 

Stake  vs.  Stake.  Oct..  1907,  228  III.  630.    . 

Beneficiary,  Member's  Marriage  Does  Not  Affect  Designation  Made. 

Sul)sequent  marriage  of  a  member  without  changing  tlie  bene- 
ficiary named  in  the  certificate  as  originally  issued  does  not  afl'ect 
the  certificate  or  tlie  rights  of  the  beneficiary,  and  no  principle  of 
public  policy  is  violated  by  permitting  a  member  to  designate  a 
stranger  as  his  beneficiary,  even  though  the  member  may  leave  a 
wife  (ir  iillipi-  relatives.  While  the  certificate  in  the  case  at  bar  was 
is.sued  by  a  fraternal  society,  it  was  not  subject  to  the  fraternal 
beneficiary  act  of  the  State  of  Illinois. 

Stake  vs.  Stake,  Oct.,  1907,  228  111.  630. 


THE    STATE    OF   ILLINOIS  199 

Beneficiary,  Not  Affected  by  Member's  Marriage. 

Where  a  member  of  a  society  organized  under  the  general  incor- 
poration act  of  1872  as  a  corporation  not  for  pecuniary  profit,  but 
for  the  purpose  of  paying  death  benefits  to  the  widows,  orphans 
and  devisees  of  deceased  members,  names  his  brother  as  beneficiary 
and  subsequently  marries  without  changing  the  beneficiary,  the 
brother  is  entitled  to  the  fund,  notwithstanding  the  deceased  leaves 
a  wife  and  practically  no  estate. 

Stake  vs.  Stake,  Oct.,  1907,  228  111.  630.  i 


200  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  INDIANA. 

CHAPTER  15. 

Definitions — Sources  of  Revenue — Exempt  from  Insurance  Laws — 
Reserve  or  Emergency  Funds. 

Section  1.  That  a  fraternal  beneficiary  association  is  hereby 
declared  to  be  ~  a  corporation,  society  or  voluntary  association 
formed,  organized  and  carried  on  for  the  sole  benefit  of  its  members 
and  their  beneficiaries  and  not  for  profit.  Each  association  shall 
have  a  lodge  system  with  ritualistic  form  of  work  and  a  representa- 
tive form  of  government.  Any  association  having  a  supreme  govern- 
ing or  legislative  body  and  subordinate  lodges  or  branches  by  what- 
ever name  known,  into  which  members  shall  be  elected,  initiated 
and  admitted  in  accordance  with  its  constitution,  laws,  rules,  regula- 
tions and  prescribed  ritualistic  ceremonies,  which  subordinate  lodges 
or  branches  shall  be  required  by  such  association  to  hold  regular 
or  stated  meetings  at  least  once  in  each  month,  shall  be  deemed  to 
be  operating  under  the  lodge  system.  An  association  shall  be  deemed 
to  have  a  representative  form  of  government  when  it  shall  provide 
in  its  constitution  and  laws  for  a  supreme  legislative  or  governing 
body,  composed  of  representatives  elected  either  by  the  members 
or  by  delegates  elected  by  the  members  through  a  delegate  con- 
vention system,  together  with  other  members  as  may  be  prescribed 
by  its  constitution  and  laws :  Provided,  That  the  elective  representa- 
tives shall  constitute  a  majority  in  number  and  have  not  less  than 
a  majority  of  the  votes,  nor  less  than  the  votes  required  to  amend 
its  constitution  and  laws,  and  Provided,  further.  That  the  meetings 
of  the  representatives  or  delegates  shall  be  held  as  often  as  once  in 


THE    STATE    OF   INDIANA  201 

four  years.  The  members,  officers,  representatives  or  delegates  of  a 
fraternal  beneficiary  association  shall  not  vote  by  proxy.  The 
supreme  lodge  or  similar  governing  body  shall  have  exclusive  right 
to  change,  amend  or  othervv'ise  alter  the  by-laws  of  the  association. 
Every  such  association  shall  make  provision  for  the  payments  of 
benefits  in  case  of  death,  and  may  make  provision  for  the  payment 
of  benefits  in  case  of  sickness,  temporary  or  permanent  physical 
disability,  either  as  the  result  of  disease,  accident  or  old  age,  pro- 
vided that  the  period  of  life  at  which  the  payment  of  physical  dis- 
ability benefits  on  account  of  old  age  commences  shall  not  be  under 
seventy  (70)  years,  all  subject  to  the  compliance  of  its  members  with 
its  constitution  and  by-laws.  The  fund  from  which  the  expenses 
of  such  association  shall  be  defrayed  shall  be  derived  from  assess- 
ments or  dues  collected  from  its  members.  Payment  of  death  bene- 
fits shall  be  to  the  families,  heirs,  blood  relatives,  affianced  husband 
or  affianced  wife  of,  or  to  persons  dependent  upon  the  member. 
Such  associations  shall  be  governed  by  this  act  and  shall  be  exempt 
from  the  provisions  of  the  insurance  laws  of  this  State,  and  no  law 
hereafter  passed  shall  apply  to  them  unless  they  be  expressly  desig- 
nated therein.  Any  such  fraternal  beneficiary  association  may 
create,  maintain,  disburse  and  apply  a  reserve  or  emergency  fund  in 
accordance  with  its  constitution  or  by-laws,  and  every  such  associa- 
tion shall  be  deemed  and  held  to  be  a  charitable  institution.  The 
terra  "fraternal  beneficiarj'  association"  wherever  used  in  this  act. 
or  in  any  other  law  of  this  State  hereafter  enacted,  shall  be  con- 
strued to  mean  anj'  association  such  as  is  defined  in  this  section: 
Provided,  That  none  of  the  provisions  of  this  act  shall  apply  to  the 
Brotherhood  of  Locomotive  Firemen  and  Enginemen,  the  Brother- 
hood of  Railroad  Trainmen,  the  Order  of  Railway  Conductors,  the 
Order  of  Railroad  Telegraphers,  or  the  Switchmen's  Union  of  North 
America,  or  any  other  similar  order.    Act  of  1903,  as  amended  1907. 

Existing  Corporations. 

Section  2.  All  such  associations  coming  within  the  description 
as  set  forth  in  section  one  (1)  of  this  act,  organized  under  the  laws 
of  this  or  any  other  State,  territory  or  province,  and  now  doing 


202  FRATERNAL    SOCIETY   LAW 

business  in  this  State,  may  continue  such  business  provided  they 
hereafter  comply  with  the  provisions  of  this  act  regulating  annual 
reports  to,  and  the  designation  of  the  auditor  of  state  or  his  suc- 
cessors in  office  as  a  person  upon  whom  legal  process  may  be  served 
as  hereinafter  provided.  Such  associations  shall  also  be  required  to 
make  sufficient  assessments  at  the  rates  named  in  their  certificates 
of  membership  to  meet  all  death  losses  as  they  occur,  and  such  asso- 
ciations shall  not  be  considered  insolvent  unless  the  mortuary  funds 
in  the  hands  of  the  supreme  officers  are  less  than  the  death  claims 
outstanding  against  the  association.  All  such  associations  which 
use  rates  of  assessments  lower  than  those  based  on  the  national  fra- 
ternal congress  table  of  mortality  shall  be  prohibited  from  advertis- 
ing or  representing  that  extra  assessments  shall  not  be  required  to 
pay  all  death  losses  as  they  occur.  If  the  membership  certificates 
issued  by  any  such  association  provide  for  the  payment  of  accident 
or  sick  benefits,  other  than  those  which  shall  permanently  reduce 
the  face  of  the  certificate,  then  the  by-laws  and  certificate  shall 
clearly  state  what  portion  of  the  assessments  are  for  the  payment  of 
such  benefits  and  all  such  funds  shall  be  kept  separate  and  distinct 
from  the  funds  available  for  the  payment  of  death  losses,  and  in  no 
event  shall  the  latter  be  used  for  the  payment  of  sick  or  accident 
disability  benefits.  The  by-laws  of  every  such  association  shall  also 
clearly  state  what  part  if  any  of  each  assessment  may  be  used  for 
expenses,  and  no  other  part  may  be  used  for  any  purpose  whatever 
other  than  the  payment  of  losses,  and  any  officer  or  other  person 
who  shall  make  any  other  use  of  such  funds  shall  be  deemed  guilty 
of  a  misdemeanor  and  upon  conviction  shall  be  punished  by  a  fine 
of  not  less  than  $500  nor  more  than  $1,000,  or  imprisonment  in  the 
county  jail  for  not  less  than  six  months  nor  more  than  one  year,  or 
both,  in  the  discretion  of  the  court.    Act  of  1903,  as  amended,  1907. 

Admission  of  Foreign  Association — Pay  Certificates  in  Full — Tables 
of  Rates — Examination — Conditions  Precedent. 

Section  3.  Any  such  fraternal  beneficiary  association,  within  the 
description  as  set  forth  in  Section  one  (1)  of  this  act,  organized 
under  the  laws  of  any  other  State,  territory  or  province,  and  not 


{ 


THE    STATE    OF   INDIANA  203 

now  doing-  business  within  [this]  State,  shall  he  admitted  to  do 
business  within  this  State,. when  it  shall  be  shown  to  the  satisfaction 
of  the  auditor  nf  Stale  that  its  charter  or  articles  td'  association, 
and  its  bydaws  ju-nvidc  tor  the  conduct  of  its  business  in  accordance 
with  the  j)rovisions  of  this  act;  that  it  luis  at  the  time  it  ajjplies  for 
admission  to  do  business  within  this  State  a  sufficient  nundjer  of 
members  so  that  one  assessment,  or  other  stated  payments  in  lieu 
of  such  assessment,  ujion  such  mendjers,  the  amount  of  which  assess- 
ment or  other  stated  i)ayment  shall  not  exceed  the  amount  pre- 
viously provided  liy  the  laws  of  the  order,  shall  be  sufficient  to  pay 
in  full  the  largest  death  loss  the  association  might  be  called  upon, 
under  its  laws  to  pay,  and  that  it  has  paid  in  full  all  just  benefits, 
claims  of  whatever  nature  incurred  by  it  within  the  two  years  last 
past:  Provided,  Such  fraternal  beneficiary  association  shall  show 
that  the  mortuary  assessment  rates,  provided  for  in  whatever  plan  of 
business  it  has  adopted  are  not  lower  than  is  indicated  as  necessary 
by  the  following  mortality  table : 


Age. 

Number 
Living. 

Number 
Dying.  . 

Probability 
of  Dying. 

20 

100,000 

500 

.005000 

21 

99,500 

501 

.005035 

22 

98,999 

502 

.005071 

23 

98,497 

503 

.005107 

24   • 

97,994 

505 

.005153 

25 

97,489 

507 

.005201 

26 

96,982 

510 

.005259 

27 

96,472 

513 

.005318 

28 

95,959 

517 

.005388 

29 

95,442 

522 

.005469 

30 

94,920 

527 

.005552 

31 

94,393 

533 

.005647 

32 

93,860 

540 

.005753 

33 

93,320 

548 

.005872 

34 

92,772 

557 

.006004 

35 

92,215 

567 

.006149 

36 

91,648 

578 

.006307 

37 

91,070 

591 

.006490 

204  FRATERNAL    SOCIETY   LAW 


Age. 
38 

Numher 
Living. 

90,479 

Number 
Dying. 

606 

Probability 
of  Dying. 

.006698 

39 

89,873 

622 

.006921 

40 

89,251 

640 

.007171 

41 

88,611 

660 

.007448 

42 

87,951 

683 

.007766 

43 

87,268 

708 

.008113 

44 

86,560 

734 

.008480 

45 

85,826 

761 

.008867 

46 

85,065 

790 

.009287 

47 

84,275 

822 

.009754 

4S 

83,453 

857 

.0102693 

49 

82.596 

894 

.0108238 

50 

81,702 

935 

.0114440 

51 

80.767 

980 

.0121337 

52 

79,786 

1,029 

.0128970 

53 

78,757 

1,083 

.0137511 

54 

77,674 

1,140 

.0146767 

55 

76,534 

1,202 

.0157054 

56 

75,332 

1,270 

.0168587 

57 

74,062 

1,342 

.0181200 

58 

72.720 

1.418 

.0194994 

59 

71,302 

1.501 

.0210513 

60 

69,801 

1,588 

.0227504 

61 

68,213 

1,681 

.0246434 

62 

66,532 

1.778 

.0267240 

63 

64.754 

1.880 

.0290330 

64 

62,874 

1,985 

.0315711 

65 

60.889 

2.094 

.0343904 

66 

58,795 

2.206 

.0375206 

67 

56,589 

2,318 

.0409620 

68 

54,271 

2,430 

.0447753 

69 

51.841 

2.539 

.0489767 

70 

49.302 

2.645 

.0536489 

71 

46.657 

2,744 

.0588122 

72 

43.913 

2,832 

.0644912 

73 

41.081 

2.909 

.0708113 

-1 

? 

> 

THE    STATE    OF    INDIANA  205 


Age. 

Ntimher 
Living. 

Number 
Dying. 

Probability 
of  Dying. 

H 

38,172 

2,969 

.0777795 

75 

35,203 

3,009 

.0854757 

76 

32,194 

3,026 

.0939!)27 

77 

29,168 

3,016 

.1034010 

78 

26,152 

2,977 

.1138345 

79 

23,175 

2,905 

.1253506 

80 

20,270 

2,799 

.1385163 

81 

17,471 

2,659 

.1521951 

82 

14,812 

2,485 

.1677694 

83 

12,327 

2.280 

.1849599 

84 

10,047 

2,050 

.1855707 

85 

7,997 

1,800 

.2250844 

86 

6,197 

1,539 

.2483460 

87 

4.658 

1,277 

.2741520 

88 

3,381 

1,023 

.3025732 

89 

2,358 

788 

.3341815 

90 

1,570 

579 

.3687898 

91 

991 

404 

.4076690 

92 

587 

264 

.4497445 

93 

323 

161 

.4984520 

94 

162 

89 

.5493827 

95 

73 

19 

.6027397 

96 

29 

19 

.6551724 

97 

10 

7 

.7000000 

98 

3 

3 

1.00000(10 

And  provided  further,  That  before  any  such  fraternal  beneficiary 
association  shall  be  authorized  to  do  business  in  this  State  it  .shall 
file  with  the  auditor  of  state  a  duly  certified  copy  of  its  constitution 
or  by-laws,  certified  to  under  oath  by  its  secretary  or  similar  officer 
and  its  chief  executive  officer,  together  with  the  appointment  of 
the  auditor  of  state  as  a  person  upon  whom  all  legal  process  may 
be  served  as  hereinafter  provided ;  and  it  must  also  be  shown  that 
the  said  association  is  duly  authorized  to  do  business  within  the 
State,  territory  or  province  in  which  it  is  incorporated  or  organized, 


206  FRATERNAL    SOCIETY    LAW 

provided  the  laws  of  such  State,  territory  or  province  provide  for  such 
authorization,  but  in  case  the  laws  of  such  State,  territory  or  prov- 
ince do  not  provide  for  any  such  formal  authorization  for  such  asso- 
ciation to  do  business,  then  such  association  shall  be  shown  to  be  con- 
ducting its  business  in  accordance  with  the  provisions  of  this  act ; 
and  to  satisfy  himself  that  such  is  the  fact,  the  auditor  of  state  may 
personally,  or  by  some  person  designated  by  him,  examine  into  the 
condition,  affairs,  character  and  business  methods,  accounts,  books 
and  investments  of  such  association  at  its  home  ofSce,  which  ex- 
amination shall  be  at  the  expense  of  such  association ;  but  such 
expense  shall  not  exceed  ten  dollars  per  diem  in  addition  to  the 
reasonable  traveling  expenses  of  the  person  making  such  examina- 
tion :  Provided,  That  the  auditor  of  state  may  accept  the  examina- 
tion made  by  the  insurance  department  of  the  State,  territory  or 
province  in  which  the  home  office  of  said  association  is  located. 
Every  provision  of  this  section  shall  be  considered  a  condition  prec- 
edent for  such  association  doing  business  within  this  State.  As 
amended  Acts  1901,  p.  312.    R.  S.  1901,  §  5050c. 

Annual   Reports — License — Report,   Form  of  and   Contents — Addi- 
tional Inquiries. 

Section  4.  Every  such  association  doing  business  within  this  State, 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and 
file  with  the  auditor  of  state  of  this  State  a  report  of  its  affairs 
and  oi)eratiou  during  the  year  ending  on  the  thirty-first  day  of  De- 
cember, immediately  preceding,  togetlier  with  a  certified  cop.y  of 
its  laws,  rules  and  regulations :  Provided,  That  no  such  association 
organized  under  the  laws  of  this  State  prior  to  the  passage  of  this 
act,  shall  be  required  to  make  such  report  until  it  is  two  years 
old.  If  such  association  is  found,  upon  examination  of  its  reports 
and  laws,  to  be  doing  business  in  accordance  with  the  provisions 
of  this  act,  the  auditor  of  state  shall  issue  it  a  license  to  do  busi- 
ness within  this  State  for  one  .year,  for  which  he  shall  charge  a  fee 
of  five  dollars  ($5).  Such  annual  reports,  which  shall  be  in  lieu  of 
all  other  re])orts  required  by  the  auditor  of  state,  shall  be  made 
on  blank  forms  provided  by  the  auditor  of  state,  or  may  be  printed 


THE    STATE    OF   INDIANA  207 

in  pamphlet  form,  and  shall  be  verified  under  oath  by  the  duly 
authorized  ofificei's  of  such  association.  This  report,  or  the  sub- 
stance thereof,  shall  be  published  in  the  annual  report  of  the  auditor 
of  state,  in  a  part  to  be  entitled  "Fraternal  Beneficiary  Associa- 
tions," and  shall  contain  answers  to  the  following  questions,  and  any 
other  information  the  auditor  of  state  may  require : 

First.  Number  of  certificates  issued  during  the  year  or  number 
of  members  admitted. 

Second.    Amount  of  indemnity  effected  thereby. 

Third.     Number  of  losses  or  benefit  liabilities  incurred. 

Fourth.    Number  of  losses  or  benefit  liabilities  paid. 

Fifth.  The  amount  received  from  each  assessment  during  the 
year. 

Sixth.  Total  amount  paid  members,  beneficiaries,  legal  repre- 
sentatives or  heirs. 

Seventh.  Number  and  kinds  of  claims  for  which  assessments  have 
been  made. 

Eighth.  Number  and  kind  of  claims  compromised  or  resisted,  and 
brief  statement  of  reasons. 

Ninth.  Does  the  association  charge  annual  or  other  periodical 
dues  or  admission  fees? 

Tenth.  How  much  on  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be? 

Eleventh.  Total  amount  received,  from  what  source,  and  the 
disposition  thereof. 

Twelfth.     Total  amount  of  salaries  paid  to  officers. 

Thirteenth.  Does  the  association  guarantee,  in  its  certificates, 
fixed  amounts  to  be  paid,  regardless  of  amounts  realized  from  assess- 
ments, dues,  admission  fees  and  donations? 

Fourteenth.  If  so,  state  amount  guaranteed,  and  the  security  for 
such  guaranty. 

Fifteenth.    Has  the  association  a  reserve  fund? 

Sixteenth.  If  so,  how  is  it  created,  what  is  its  purpose,  its  amount, 
and  how  is  it  invested? 

Seventeenth.    Has  the  association  more  than  one  class? 

Eighteenth.  If  so.  how  many  and  the  amount  of  indemnity  in 
each? 


208  FRATERNAL    SOCIETY   LAW 

Nineteenth.    Number  of  members  in  each  class. 

Twentieth.  If  it  is  a  voluntary  association,  so  state  and  give 
date  of  its  organization. 

Twent,y-first.  If  organized  under  the  laws  of  this  State,  under 
what  law  and  at  what  time,  giving  year  and  date  of  the  approval 
of  the  act  1 

Twenty-second.  If  organized  under  the  laws  of  any  other  State, 
territory  or  province  state  such  fact  and  the  date  of  organization, 
with  complete  reference  and  designation  of  the  law  or  laws  under 
which  organized. 

TAvent.y-third.  Number  of  certificates  of  benefieiarj'  membership 
lapsed  during  the  j^ear. 

Twenty-fourth.  Number  in  force  at  the  beginning  and  end  of  the 
year;  if  more  than  one  class,  the  number  in  each  class. 

Twenty-fifth.  Names  and  addresses  of  its  president,  secretary  and 
treasurer  or  corresponding  officers. 

The  auditor  of  state  is  authorized  and  empowered  to  address  any 
additional  inquiries  to  any  such  association  in  relation  to  its  busi- 
ness or  condition,  or  any  other  matter  connected  with  its  transaction, 
relative  to  the  business  contemplated  by  this  act,  and  such  officers 
of  such  associations  as  the  auditor  of  state  may  require  shall 
promptly  i"eply  in  writing,  under  oath,  to  all  such  inquiries.  R.  S. 
1901,  §  5050d. 

Auditor  of  State  Attorney  for  Process — Duty  of  Auditor — Service 
of  Process  on  Domestic  Associations. 

Section  5.  Every  such  association  now  doiug  or  hereafter  admit- 
ted to  do  business  within  this  State,  and  not  having  its  principal 
office  within  tlii.s  State,  and  not  being  organized  under  the  laws  of 
this  State,  shall  appoint  in  writing  the  auditor  of  state  and  his  suc- 
cessors in  office  to  be  its  true  and  lawful  attorney,  upon  whom  all 
legal  process  in  any  action  or  proceeding  against  it  must  be  served, 
and  in  such  writing  shall  agree  that  any  lawful  process  against 
it  which  is  served  on  said  auditor  of  state,  shall  be  of  the  same  legal 
force  and  validity  as  if  served  upon  said  association,  and  that  the 
authority  shall  remain  in  force  so  long  as  any  liability  against  such 
association  remains  outstanding  within  this  State.     Copies  of  such 


THE    STATE    OF    INDIANA  209 

certificate,  certified  by  said  auditor  of  stati',  shall  br  clcriucd  svii'- 
ficient  evidence  thereof,  and  shall  be  admitted  in  evidence  with  the 
same  force  and  efi'ect  as  the  original  tlici-oof  might  ))(■  admitted. 
Service  u])on  such  auditor  of  state  shall  bi'  deemed  sni'licient  service 
U|iiiii  such  associal  inn,  pi-dxidi'd  tiiat  siidi  proci'ss  shall  not  bu  re- 
turnable until  thirty  da\s  after  such  service.  When  legal  process 
against  any  such  association  is  served  upon  the  said  auditor  of  state, 
he  shall  immediately  notify  the  association  of  such  service  by  letter, 
prepaid  and  directed  to  its  secretary  or  corresponding  officer,  and 
shall,  within  two  daj^s  after  such  service,  forward  in  the  same  man- 
ner a  copy  of  the  jjrocess  served  upon  him  to  such  officer.  The 
plaintiif  in  the  action  upon  which  .such  process  was  issued  shall  pay 
to  the  auditor  of  state  at  the  time  of  sueli  service  a  fee  of  three 
dollars  ($3),  which  shall  be  recovered  bj^  said  plaintiff  as  a  part 
of  his  taxable  costs,  if  he  prevail  in  his  said  action.  The  auditor 
of  state  shall  keep  a  record  of  all  processes  served  upon  him,  which 
record  shall  show  the  day  and  hour  when  such  service  was  made 
and  when  the  notice  hereinbefore  provided  for  was  given  to  the 
officers  of  such  association.  In  all  suits  in  this  State  against  any 
such  association  organized  under  the  laws  of  this  State,  and  having 
its  principal  office  in  this  State,  service  shall  be  had  only  upon  the 
chief  executive  officer  or  the  secretary  or  corresponding  officer  of 
such  association.    R.  S.  1901,  §  5050e. 

License  and  Fee. 

Section  6.  The  auditor  of  state,  upon  the  application  of  any  fra- 
ternal beneficiary  association  having  the  right' to  do  business  within 
this  State,  as  provided  for  in  this  act,  shall  issue  to  such  association 
a  permit  in  writing  authorizing  such  association  to  do  business 
within  this  State  for  one  year  from  the  date  thereof,  for  which 
permit  or  certificate  and  all  proceedings  in  connection  therewith 
such  association  shall  pay  to  the  auditor  of  state  a  fee  of  five  dollars 
($5).    R.  S.  1901,  §5050f. 

Examination  by  Auditor — Expense. 

Section  7.     The  auditor  of  state,  at  the  reqiiest  of  any  such  frater- 
14 


210  FRATERNAL    SOCIETY    LAW 

nal  beneficiary  association  doing-  business  under  the  provisions  of 
this  act  in  this  State,  shall  make  an  examination  of  the  books  and 
accounts  of  such  association,  and  shall  furnish  a  certificate  of  the 
results  of  such  examination,  showing  all  of  such  association's  assets 
and  how  invested,  the  condition  of  its  business,  its  methods  and  such 
other  particulars  as  may  be  deemed  necessary  to  show  the  char- 
acter and  condition  of  the  financial  affairs  of  such  association ;  and 
such  association  shall  at  all  times  be  subject  to  such  examination 
without  any  request  being  made  by  them.  The  necessary  expense 
of  this  examination  shall  be  paid  by  such  association,  but  it  shall 
not  exceed  ten  dollars  a  day  and  the  necessary  traveling  expenses  of 
the  person  making  the  examination.    R.  S.  1901,  §  5050g. 

Organization — Approval  by  Auditor — Fee  —  Certificate — Articles, 
Form  and  Contents. 

Section  8.  Any  number  of  persons,  citizens  of  the  United  States, 
not  less  than  seven,  five  of  whom  shall  also  be  citizens  of  the  State 
of  Indiana,  hereafter  desiring  to  form  a  fraternal  beneficiary  asso- 
ciation, may  associate  themselves  together  and  effect  such  organiza- 
tion in  the  manner  provided  in  this  section,  and  not  otherwise. 
Articles  of  association  shall  be  prepared  in  triplicate  in  the  manner 
hereinafter  provided  and  submitted  to  the  auditor  of  state  for  his 
approval,  together  with  the  proposed  litei'ature,  by-laws,  rules  and 
regulations  governing  such  association  and  the  proposed  table  of 
mortuary  assessment  rates  under  whatever  plan  of  business  it  may 
have  adopted,  and  that  such  rates  are  not  lower  than  is  indicated 
by  the  mortality  table  provided  in  amended  section  3  of  the  above 
entitled  act,  and  they  shall  not  be  approved  by  the  said  auditor  if 
it  shall  appear  that  the  name  selected  is  the  same,  or  so  near  the 
same,  as  that  of  any  other  association  or  corporation  then  doing 
biisiness  within  this  State  as  to  cause  confusion  in  the  minds  of  the 
people  or  to  interfere  with  the  rights  of  such  existing  association  or 
corporation,  or  that  the  ob.iects  of  the  a.ssociation  are  not  in  accord- 
ance with  the  provisions  of  this  act,  or  of  any  other  law  or  laws  of 
this  State  applicable  to  such  associations,  or  tliat  Ihe  said  articles 
of  association  do  not  conform  to  the  provisions  of  this  act  in  every 
y)ai'ticnlar :  but  in  case  none  of  these  objections  are  found  to  exist. 


THE    STATE    OF   INDIANA  211 

the  said  auditor  of  state  shall  endorse  on  the  back  of  each  copy  of 
said  articles  of  association  the  fact  that  he  has  approved  them, 
together  with  the  date  of  such  action,  all  of  which  shall  be  signed 
by  him  with  his  official  title :  Provided,  however,  That  before  the 
said  auditor  of  state  shall  approve  any  such  articles  of  association 
it  shall  be  shown  to  him  by  the  sworn  statement  of  one  or  more  of 
the  proposed  incorporators  that  at  least  three  hundred  persons  have 
signed,  in  good  faith,  applications  for  beneficiary  membership  in 
such  proposed  association  and  paid  to  the  proper  one  of  such  pro- 
posed incorporators  the  amount  of  one  death  or  mortuary  collection, 
by  whatever  name  it  may  lie  called,  and  that  such  money  is  deposited 
with  some  bank  or  trust  company  and  held  for  the  special  jjurpose 
named.  For  this  examination  and  approval  of  the  articles  of  asso- 
ciation herein  mentioned,  the  auditor  of  state  shall  collect  a  fee  of 
five  ($5)  dollars.  One  copy  of  such  articles  of  association,  approved 
as  hereinbefore  provided,  shall  be  filed  with  the  secretary  of  state, 
whereupon  the  said  secretary  of  state  shall  issue  his  certificate  of  in- 
eoi'poration  and  permanently  attach  the  same  by  the  seal  of  the  State 
to  another  copy  of  the  said  articles  of  association,  approved  as  here- 
inbefore provided,  which  copy  shall  be  delivered  to  the  incorporators 
of  such  association.  The  third  approved  copy  of  such  articles  of 
association  shall  be  filed  with  the  auditor  of  state.  The  articles  of 
association  hereinbefore  mentioned  shall  be  substantially  in  the  fol- 
lowing form : 

First.  The  preamble  shall  name  the  incorporators  and  give  the 
residence  of  each  and  the  fact  of  their  citizenship  as  herein  requii'ed, 
and  express  their  desire  to  incorporate  a  fraternal  beneficiary  asso- 
ciation in  accordance  with  and  under  the  provisions  of  this  act 
(designating  this  act  so  as  to  positively  identify  it). 

Second.     Article  1  shall  give  the  name  of  the  association. 

Third.  Article  2  shall  state  the  location  of  the  principal  office 
of  the  association. 

Fourth.  Article  3  shall  state  the  ob.jeets  of  the  association  and 
the  plans  by  which  these  objects  are  to  be  carried  out,  including 
the  extreme  limit  of  the  age  of  persons  to  whom  benefit  cei-tificates 
may  be  issued,  which  limit  of  age  shall  not   (>xceed  fifty-five  (55) 


212  FRATERNAL    SOCIETY    LAW 

years,  and  it  shall  also  state  the  fact  that  all  beneficiary  members 
will  be  required  to  pass  a  medical  examination  such  as  is  usually 
required  by  fraternal  beneficiary  associations. 

Fifth.  Article  4  shall  state  the  name  of  the  persons  selected  to 
manage  the  business  or  prudential  afi:'airs  of  the  association  for  the 
first  term,  for  which  such  persons  are  to  be  elected,  and  the  manner 
of  electing  their  successors,  the  title  of  all  officers  and  the  names 
of  such  officers  with  their  residences,  if  they  have  been  selected. 

Sixth.  Article  5  shall  contain  a  description  of  the  corporate  seal 
adopted  by  such  association,  together  with  an  impress  of  the  same. 
These  articles  of  association  shall  be  signed  and  acknowledged  by 
each  of  the  incorporators.  As  amended,  Acts  1901,  p.  315.  R.  S. 
1901,  §5050h. 

Existing-  Associations,  Reincorporation — Manner  of. 

Section  9.  Any  such  fraternal  beneficiary  association  that  is  now 
doing  business  in  this  State  as  a  corporation  de  .iure  or  a  corporation 
de  facto,  by  virtue  of  any  law  of  this  State  authcu-izing  the  incorpo- 
ration of  such  associations,  may  reincorporate  under  the  provisions 
of  this  act,  and  receive  from  the  secretary  of  state  a  certificate  of 
reincoi'poration,  which  certificate  shall  also  state  the  date  of  the 
original  incorporation.  Any  such  association  desiring  to  reincorpo- 
rate under  this  act  shall,  by  its  supreme  governing  body,  council, 
executive  committee  or  other  body  or  committee  having  power  to 
change  its  laws,  adopt  a  resolution  embodying  new  articles  of  asso- 
ciation prepared  to  conform  to  section  seven  [eight]  of  this  act, 
which  resolution  must  be  copied  in  triplicate,  signed  by  the  execu- 
tive officer  of  the  body  adopting  it.  or  by  the  chief  executive  officer 
of  the  association ;  and  its  correctness  and  the  fact  that  it  was 
adopted  in  accordance  with  the  provisions  of  this  section  must  be 
certified  to  under  oath  by  the  secretary  or  similar  officer  of  such 
association.  The  aforesaid  triplicate  copies  of  such  resolution  shall 
then  be  submitted  to  the  auditor  of  state  for  his  approval,  the  same 
as  if  they  were  original  articles  of  association,  as  i)rovided  in  section 
seven  [eight]  (159  herein)  of  this  act,  and  one  copy  shall  be  filed 
Avitli  llie  said  auditor  of  state  and  one  copy  with  the  secretary  of 
state   in   the   niMuncr  ])r()vid(Ml    in   section  seven  of  this  act   for  the 


THE    STATE    OF    INUIANA  213 

incorporation  of  new  associations;  and  when  this  is  done,  the  secre- 
tary of  state  sliall  issue,  in  the  manner  provided  in  section  seven  of 
thi  saet,  his  certificat('  of  reincorporation;  and  thereafter  such  asso- 
fi:iliiiii  shall  be  deemed  to  be  reincorporated  under  the  provisions 
or  I  his  .-ict.    R.  S.  11301,  §5050i. 

Fee  for  incorporation  same  as  ior  original  incorporation.  Opinion  At- 
torney-General Taylor,  1899. 

Rights  and  Powers. 

Section  10.  Every  such  fraternal  beneficiary  association,  fi'om 
the  time  it  files  a  copy  of  its  articles  of  association  for  record  in 
the  ofSee  of  the  auditor  of  state  and  files  a  copy  of  the  said  articles 
of  association  with  the  secretary  of  state  and  receives  his  certifi- 
cate of  incorporation,  as  provided  either  in  section  seven  [eight] 
or  in  section  eight  [nine]  of  this  act,  shall  be  deemed  and  held  to 
be  a  corporation  or  body  politic  in  perpetuity,  and  shall  have  and 
possess  all  the  rights,  powers  and  ])rivileges  given  to  corporations 
by  common  law ;  it  may  sue  and  be  sued  in  any  court  of  pi-oper 
jurisdiction;  it  may  borrow  money  and  sectire  the  payment  of  the 
same  by  notes  and  mortgages,  bonds  or  deeds  of  trust  upon  its 
personal  or  real  property;  it  may  rent,  lease,  purchase,  hold,  sell 
and  convey  such  real  and  personal  property  as  may  be  necessary 
and  proper  for  the  purpose  of  erecting  Intildings  for  the  use  of  such 
association  and  for  other  proper  objects  of  such  association,  or  which 
may  be  taken  for  debts  dtxe  stich  association ;  and  it  may  in  general 
do  all  things  not  prohibited  by  law  that  are  necessary  and  proper  for 
the  economical  and  proper  conduct  of  its  business.  B.  S.  1901, 
§  5050 j. 
Shall  Not  Employ  Paid  Agents. 

Section  11.  Such  association  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organization  or  btiild- 
ing  up  of  stiboi'dinate  bodies  or  granting  members  inducements  to 
procure  new  members.     R.  S.  1901,  §  .30.50k. 

Right  of  Member  to  Change  Beneficiary. 

Section  12.     No  contract  between  a  member  and  his  beneficiary, 


214  FRATERNAL    SOCIETY    LAW 

that  the  beneficiary,  or  any  other  person  for  him  shall  pay  such 
member's  assessments  and  dues,  or  either  of  them,  shall  give  the 
beneficiary  or  other  person  a  vested  right  in  the  benefit  certificate  or 
in  the  benefit,  or  deprive  the  member  of  the  right  to  change  the 
name  of  the  beneficiary,  or  revoke  the  ertificate,  if  any,  issued  by 
such  association :  Provided.  That  such  change  or  revocation  to  be 
made  by  written  or  printed  notice  to  the  association  in  the  manner 
and  form  provided  for  by  its  by-laws.    K.  S.  1901.  §  5050 1. 

Exemption  from  Attachment— Exemption  from  Taxation— Excep- 
tion. 

Section  13.  The  money,  or  other  benefit,  charity,  relief  or  aid  to 
be  paid,  provided  or  rendered  by  any  association  authorized  to  do 
business  under  this  act  shall  not  be  liable  to  attachment  by  trustee, 
garnishee  or  other  process,  and  shall  not  be  seized,  taken,  appro- 
priated or  applied  by  any  legal  or  equitable  jirocess  or  by  opera- 
tion of  law  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of 
any  beneficiary  named  in  any  certificate  or  any  person  who  may 
have  any  right  thereunder.  And  the  buildings  and  other  property 
used  by  said  association  in  carrying  on  its  business,  and  all  dvies, 
assessments  and  other  payments  and  the  accumulations  thereof,  held 
and  possessed  by  said  association  for  the  payment  of  death,  sick  or 
disability  benefits,  and  the  reserve,  emergency  and  other  mortuary 
funds  of  said  association  shall  be  exempt  from  taxation  for  State, 
county  and  municipal  purposes :  Provided,  That  nothing  in  this  act 
shall  be  construed  to  exempt  from  taxation  any  real  estate  owned 
by  any  association  incorporated  or  doing  business  under  the  pro- 
visions of  this  act,  except  .such  as  is  occupied  exclusively  by  such 
association  in  carrying  on  its  business.  As  amended,  Acts  1903,  p.  19. 

As  to  right  to  exempt  property  from  taxation,  see  section  1,  article  10,  Con- 
stitution of  Indiana.    Also  annotation  to  case  of  Hogg  v.  Mackay,  19  L.  R.  A.  77. 

Right  to  attach  proceeds  of  certificate  after  payment  to  beneficiary.  Reig- 
hart  V.  Harris.  51  Pac.  Rep.  788.  \ 

Also,  see  Wright  v.  Wright,  100  Tenn.  313;  Burton  v.  Snyder,  43  Pac.  Rep. 
1004;  Lake  v.  Minnesota,  etc.,  Ass'n,  63  N.  W.  Rep.  261;  Larrabee  v.  Pal- 
mer, 70  N.  W.  Rep.  100;  Murdy  v.  Skyles,  70  N.  W.  Rep.  714;  How  v.  How,  63 
N.  W.  Rep.  627;  Clark  v.  Lynch,  31  N.  Y.  Supp.  1038;  Crumley  v.  Fuller,  57 
Pac.  47;  Grand  Lodge  v.  Dister,  2  Mo.  App.  R.  71;  Skinner  v.  Holt,  69  N.  W. 
13 


THE    STATE    OF    INDIANA  215 

595;  Sulz  v.  Mutual,  etc.,  Ass'n,  145  N.  Y.  563;  Nims  v.  Ford,  159  Mass.  575; 
Commercial  Ass'n  v.  Newkirk,  16  N.  Y.  Supp.  177;  Brown  v.  Balfour,  46 
Minn.  6S;  Bull  v.  Ease,  58  N.  Y.  Supp.  774;  Aniburg  v.  Manhattan  Life,  67  N. 
Y.  Supp.  872. 

Legislative  Body  May  Meet  Outside  of  State. 

Section  14.  Any  such  fraternal  beneficiary  association  organized 
under  the  laws  of  this  State  may  provide  for  the  meetings  of  its 
legislative  or  governing  body  in  any  other  State,  territory  or 
province,  wherein  such  association  shall  have  subordinate  lodges  or 
bodies,  and  all  business  or  corporate  acts  transacted  at  such  meetings 
shall  be  valid  in  all  respects  as  if  such  meetings  were  held  in  this 
State ;  and  where  the  laws  of  any  such  associations  provide  for  the 
election  of  its  officers  by  votes  to  be  cast  in  its  subordinate  bodies, 
the  votes  so  cast  by  its  subordinate  bodies  in  any  other  State,  terri- 
tory or  province  shall  be  valid  as  if  cast  in  this  State.  R.  S.  1901, 
§  5050n. 

See  Bastian  v.  Modern,  etc.,  166  111.505;  Head  Camp  v.  Woods  (Cal.),  81 
Pac.  Rep.  261. 

Application— Proof  of  Claim — Penalty  for  Fraud. 

Section  15.  Any  person,  officer,  member  or  examining  physician 
who  shall  knowingly  or  willfully  make  any  false  or  fraudulent  state- 
ment or  representation  in  or  with  reference  t(J  any  application  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit 
in  any  association  transacting  business  under  this  act,  shall  be 
guilty  of  a  misdemeanor,  and  upon  conviction  shall  be  punished  by 
a  fine  of  not  less  than  $100,  nor  more  than  .$500,  or  imprisonment 
in  the  county  jail  for  not  less  than  thirty  days  nor  more  than  one 
year,  or  both,  in  the  discretion  of  the  court;  and  any  person  who 
shall  willfully  make  any  false  statement  of  any  material  fact  or 
thing  in  a  sworn  statement  as  to  the  death  or  disability  of  a  certifi- 
cate holder  or  member  of  any  such  association,  for  the  purpose  of 
procuring  payment  of  a  benefit  named  in  the  certificate  of  such 
holder,  and  any  person  who  shall  willfully  make  any  false  statement 
in  any  verified  report  or  declaration  under  oath,  required  or  author- 
ized by  this  act,  shall  be  guilty  of  perjury,  and  shall  be  proceeded 


216  FRATEKKAL    HUVIETY    LAW 

against  and  punished  as  provided  by  the  statutes  of  this  State  in 
rehition  to  the  crime  of  perjury.    R.  S.  1901,  §  5050o. 

Failure  to  Make  Report,  Penalty — Injunction — Readmission — Con- 
dition Precedent — Violating  Injunction,  Penalty. 

Section  16.  Any  such  association,  whether  heretofore  or  here- 
after organized  under  the  laws  of  this  State  or  of  any  other  State, 
territory  or  i>rovinee,  refusing  or  neglecting  to  make  the  report  pro- 
vided for  in  this  act,  shall  be  excluded  from  doing  business  within 
this  State.  The  auditor  of  state,  within  sixty  days  after  such  asso- 
ciation shall  exceed  its  powers  or  shall  conduct  its  business  fraudu- 
lently, or  shall  be  insolvent,  or  .shall  fail  to  comply  with  au.v  of 
the  provisions  of  this  ;ict.  must  give  notice  thereof  in  writing  to  the 
attorney-general,  who  shall  immediately  commence  an  action  against 
such  association  to  enjoin  it  from  carrying  on  any  business  within 
this  State,  or  if  found  to  be  insolvent,  for  the  appointment  of  a  re- 
ceiver to  wind  up  its  affairs.  No  injunction  against  any  such  asso- 
ciation to  enjoin  it  from  transacting  business  in  this  State,  or  order 
appointing  a  receiver  therefor,  shall  be  granted  by  any  court  except 
on  application  of  the  attorney-general  at  the  request  of  the  auditor 
of  state,  where  the  State,  or  a  member,  or  other  party,  seeks  relief. 
No  association  so  enjoined  shall  have  authority  to  continue  business 
until  such  report  shall  1)e  made,  or  overt  act  or  violations  of  the 
law  complained  of  shall  be  coi-rected.  nor  until  the  costs  of  such 
action  shall  be  paid  by  it.  provided  the  court  shall  find  that  such 
association  was  in  default  as  charged  and  that  such  association  is 
solvent.  Whereupon  the  auditor  of  state  shall  reinstate  such  asso- 
ciation and  not  until  then  shall  such  association  be  again  allowed  to 
do  business  within  this  State.  Any  officer,  agent,  or  person  acting 
for  any  such  association  ov  subordinate  body  thereof  within  this 
State,  while  such  assoeialion  shall  be  so  enjoined  or  prohibited  from 
doing  business,  imrsuaut  to  this  act.  or  after  received  has  been  ap- 
pointed, for  such  association,  shall  be  deemed  guilty  of  a  misde- 
meanor, and  on  conviction  thereof  shall  be  punished  by  a  fine  of  not 
less  than  twenty-five  ($25)  dollars  nor  nuire  than  two  hundred 
($200)  dollars,  or  by  impri.sonment  in  the  county  jail  for  not  less 
than  thirty  (30)  days  nor  more  than  one  year,  or  bj^  both  such  fine 


THE    STATE    OF    INDIANA  217 

and  imprisonment  in  the  discretion  of  the  court.    As  amended,  Acts 
1901,  p.  312,  R.  S.  1901,  §  5050p. 

Penalty  for  Doing  Business  for  Unauthorized  Associations. 

Section  17.  Any  person  who  shall  act  within  this  State  as  an 
ofScer,  agent  or  otherwise  for  any  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provisions  of,  this  act,  or  shall  have  failed  or  neglected 
to  procure  from  the  auditor  of  state  a  proper  certificate  of  authority 
to  transact  business  as  provided  for  by  this  act,  shall  be  subjected 
to  the  penalty  provided  in  the  last  preceding  section  for  the  mis- 
demeanor therein  specified.    R.  S.  1901,  §  5050q. 

Retaliatory  Section. 

Section  18.  When  any  other  State,  territory  or  province  shall 
impose  any  obligation  upon  any  fraternal  beneficiary  association  or- 
ganized under  the  laws  of  this  State,  or  its  agents  or  representatives, 
or  other  persons  transacting  business  for  it  in  such  other  State,  ter- 
ritory or  i^roviuce,  the  like  oltligations  are  hereby  imposed  on  similar 
fratei'nal  beneficiary  associations  organized  under  the  laws  of  such 
other  State,  territory  or  province,  and  their  agents  or  representa- 
tives doing  business  in  this  State.    R.  S.  1901,  §  5050r. 

Associations  Exempted  from  Provisions  Hereof. 

Section  19.  This  act  shall  not  apply  to  any  corporation,  society 
or  association  carrying  on  the  business  of  life,  health,  casualty  or 
accident  insurance  for  profit  or  gain,  but  it  shall  apply  only  to  fra- 
ternal beneficiary  association.s  as  defined  in  section  one  of  this  act; 
this  act  shall  not  affect  or  apply  to  any  grand  or  subordinate  lodge 
of  the  Ancient  Order  of  Free  and  Accepted  IMasons,  Independent 
Order  of  Odd  Fellows,  Improved  Order  of  Red  Men,  or  Knights  of 
Pythias,  as  they  now  exist,  nor  to  similar  orders  or  secret  societies, 
nor  to  any  association  not  working  on  the  lodge  system,  or  which 
limits  its  certificate  holders  to  a  particular  class,  or  to  the  employes 
of  a  particular  town  or  city,  designated  firm,  business  hoxise  or  cor- 
poration.   R.  S.  1901,  §  5050s. 


218  FRATERNAL    SOCIETY   LAW 

Lodges  and  other  subordinate  bodies  of  Masons,  etc.,  are  author- 
ized to  incorporate  as  voluntaiy  associations,  by  act  approved  March 
9.  1901,  which  act  provides  as  set  forth  in  the  next  19  sections: 

Articles  of  Association. 

Section  1.  That  anj'  number  of  persons,  not  less  than  three  (3), 
may  voluntarily  associate  themselves  bj'  written  articles  of  associa- 
tion signed  and  acknowledged  by  each  person  who  may  be  a  member 
at  the  time  of  organization,  specifying: 

First.  -The  corporate  name  of  such  association,  which  shall  not 
be  the  same  or  similar  to  the  name  of  any  other  association  incor- 
poi-ated  in  this  State. 

Second.  The  amount  of  the  capital  stock  of  the  same,  if  such 
association  is  organized  for  pecuniary  profit,  and  the  number  of 
shares  (if  any)  into  which  the  same  shall  be  divided,  with  the 
amount  of  each  share,  which  sluill  not  exceed  one  hundred  dollars 
($100). 

Third.  The  object  of  such  association,  with  the  proposed  plan 
of  doing  business  fully  set  out. 

Fourth.  The  names  and  places  of  residence  of  each  incorporating 
member. 

Fifth.    The  principal  place  of  business  of  such  association. 

Sixth.  The  term  of  existence  of  such  association,  which,  if  or- 
ganized for  pecuniary  profit,  shall  not  exceed  fifty  (50)  years. 

Seventh.     A  description  of  the  corporate  seal ;  and 

Eighth.  The  manner  of  election  or  appointment  of  all  directors 
and  officers  who  are  to  manage  the  business  and  prudential  concerns 
of  any  such  association. 

Ninth.  The  number  of  trustees,  directors  or  managers  who  shall 
manage  the  affairs  of  the  association,  together  with  the  names  of 
those  who  shall  manage  such  aft'airs  for  the  fii'.st  year.  R.  S.  1901, 
§  4583. 

Purposes  of  Association — Lodges  of  Masons,  Etc. 

Section  2.    That  such  associations  ma.v  be  formed  for  one  only  of 

the  following  purposes: 


'         THE    STATE    OF    INDIANA  219 

.Section  7.  To  org'jitiizi'  lodses  of  othci'  bodies  ol'  Masons.  Odd 
Fellows,  Knights  of  Pxtliias,  Ifniforni  Rank  Kniglits  of  rytliias,  An- 
cient Order  United  AVorkmen,  BeiHsvolent  Order  Elks,  Knights  of 
Honor  and  Knights  and  Ijndies  of  Honor.  Ro.val  Arcanum,  Conti- 
nental Fraternal  Union,  or  the  National  Union,  or  other  secret  ritual- 
istic orders,  according  to  their  respective  laws;  also  divisions  or 
associations  of  temperance  or  other  charitable  associations  or  organ- 
izations.   R.  S.  1901,  §§  4584-4589. 

When  treated  as  mutual  insurance  conipan.y.  Opinion  Attorney- 
General  Hord.  1884. 

Articles   of   Incorporation    Presented   to   Secretary    of   State — Re- 
cording. 

Section  27.  That  such  incorporating  members  of  such  association 
shall  first  present  their  articles  of  association  to  the  secretary  of 
state  of  the  State  of  Indiana  for  filing;  and  at  the  time  of  present- 
ing said  articles  (and  before  presenting  the  same  for  filing  to  the 
recorder  of  the  county  in  which  the  same  is  organized)  they  shall 
also  present  therewith  full  written  or  printed  statements  of  the 
proposed  plan  of  doing  business;  and  if,  upon  examination,  said 
secretary  of  state  shall  find  said  articles  to  be  according  to  law,  and 
its  proposed  plan  of  doing  business  not  inconsistent  with  the  existing 
laws  of  the  State  of  Indiana,  or  of  the  United  States,  and  upon  the 
payment  of  the  fees  prescribed  by  law.  he  shall  issue  to  sucli  corpo- 
ration a  certificate  of  incorporation,  which  shall  be  prima  facie 
evidence  of  such  incorporation.  Every  such  association,  after  such 
articles  have  been  so  approved  by  the  secretarv  of  state,  shall  file 
a  duplicate  of  its  articles  in  the  recorder's  office  of  the  county  in 
which  the  principal  place  of  business  of  such  association  is  located, 
and  upon  the  expense  of  filing  and  recording  being  paid  such  re- 
corder shall  record  the  same  in  the  miscellaneous  book  of  records 
in  his  office,  and  such  record  or  a  certified  copy  thereof  shall  be 
conclusive  evidence  of  the  matters  and  things  therein  stated.  R.  S. 
1901,  §4595n. 

Interment  associations  cannot  incorporate  under  this  law  unless  on  lod§e 
system.     Opinion   Attorney-General   Taylor,    January   7,    1901. 


220  FRATERNAL    SOCIETY    LAW 

Powers. 

Section  28.  Eveiy  .such  association,  from  the  time  such  certificate 
is  issued  by  the  secretary  of  state  and  such  articles  are  recorded 
in  the  recorder's  office,  shall  be  deemed  and  held  to  be  a  corporation, 
and  shall  have  and  possess  all  the  rights,  powers  and  privileges 
given  to  corporations  by  common  law.  to  sue  and  be  sued,  to  borrow 
money  and  secure  the  jjayment  of  the  same  by  notes  and  mortgages, 
bonds  or  deeds  or  trust  upon  their  pei'sonal  and  real  property,  and 
rent,  lease,  purchase,  hold,  sell  and  convey  such  real  and  personal 
property  as  may  be  necessary  and  proper  for  the  purpose  of  erecting 
buildings  and  for  other  necessary  objects  of  any  such  corporation. 
E.  S.  1901,  §  45950. 

Duties  of  Auditor  of  State — Receiver. 

Section  29.  That  snt-li  association,  at  the  time  of  filing  its  said 
articles  with  the  secretary  of  state,  shall  likewise  file  a  copy  thereof 
in  the  office  of  the  auditor  of  .state  of  the  State  of  Indiana,  and  shall 
also  file  in  the  office  of  the  auditor  of  state,  from  time  to  time, 
written  or  printed  copies  of  its  constitution  and  all  by-laws  there- 
after adopted;  and  said  auditor  of  state  shall  have  ])ower  to  examine 
any  such  association  at  an\-  time,  and  if  upon  any  such  examination 
said  auditor  of  state  shall  find  that  any  such  association  is  doing  a 
business  not  authorized  by  law,  he  shall  notify  such  association  to 
cease  doing  such  unauthorized  business,  and  such  association  shall 
at  once  cease  doing  such  unauthorized  business ;  and  if  such  asso- 
ciation shall  fail  or  refuse  to  cease  doing  such  unauthorized  business, 
or  shall  be  insolvent,  then  in  either  such  event  the  auditor  of  state 
shall  notify  the  attorney-general  of  the  result  of  such  examination 
and  condition,  and  the  attorney-general  shall  thereupon  be  author- 
ized to  institute  proceedings  for  injunction,  for  a  receiver  or  for  a 
judgment  of  ouster  by  proceedings  in  quo  warranto,  or  for  seques- 
tration of  property,  or  such  other  legal  proceedings  as  may  be  neces- 
sary or  proper  in  the  premises.    R.  S.  1901,  §  •4595p. 

Capital  Stock — Increase  or  Decrease. 

Section  30.     That  every  such  association  mav  designate  the  man- 


THE    STATE    OF    INDIANA  221 

ner  in  which  its  sliar'e's  of  stock  (if  any)  may  be  held,  sold,  con- 
veyed, assigued  or  Iransferrod.  Any  voluntary  association  here- 
tofore or  hereafter  organized  iiinlci-  tiic  laws  of  the  State  of  Indiana 
for  any  of  the  purposes  set  out  in  this  act  may  increase  or  decrease 
its  capital  stock  at  any  annual  meeting  of  the  stockholders:  Pro- 
vided, That  written  or  printed  notice  of  such  proposed  increase  or 
decrease  shall  be  given  by  the  secretary  of  the  association  to  its 
stockholders  by  depositing  such  notices  in  the  mail  at  least  ten  (10) 
days  before  such  annual  meeting,  addressed  to  their  last  named 
place  of  residence :  And  provided,  further,  That  any  such  association 
heretofore  or  hereafter  organized  may  increase  its  capital  stock  at 
any  special  meeting  of  the  stockholders  by  a  vote  representing  a 
majority  of  all  the  outstanding  stock  of  such  association ;  such  spe- 
cial meeting  to  be  called  for  that  purpose:  Provided,  Written  or 
printed  notice  of  such  proposed  change,  signed  by  the  secretary 
of  the  company,  shall  be  deposited  in  the  mail  addressed  to  each 
of  the  stockholders  of  such  association  at  least  ten  (10)  days  before 
such  special  meeting,  at  their  last  known  place  of  residence.  R.  S. 
1901,  §  4595q. 

Election  of  Officers — Books — Evidence. 

Section  31.  Every  such  association  shall  elect  such  officers  or 
agents  as  may  be  necessary  to  carry  into  operation  the  objects  of 
its  organization.  It  may  prescribe  and  adojit  rules  and  regulations 
for  the  direction  of  its  ofScers  and  members;  and  such  corporation 
shall  keep  a  fair  record  of  its  proceedings  and  accounts  in  proper 
books,  and  such  records,  or  copies  thereof,  duly  attested  by  the 
secretary  or  clerk  under  its  corporate  seal,  may  be  given  and  read 
in  evidence  in  any  court  of  this  State.    R.  S.  1901,  §  4595r. 

Section  32.  Any  property,  real  or  personal,  may  be  bequeathed, 
devised  or  given  to  any  such  corporation  by  will ;  and  in  such  cases, 
it  shall  be  sufficient  if  the  corporate  name  be  used  or  the  purpose 
so  described  as  not  to  admit  of  a  reasonalile  doubt  for  what  corpora- 
tion or  purpose  the  same  was  intended  to  Ix'  devised  or  given.  R.  S. 
1901,  §  4595s. 


222  FRATERNAL    SOCIETY    LAW 

Dissolution — Receiver. 

Section  33.  Whenever  two-thirds  in  interest  of  the  members  of 
any  such  corporation  heretofore  or  hereafter  organized,  desire  to 
close  its  concerns,  they  may  apply  by  petition  to  the  circuit  or 
superior  court  of  the  county  in  which  the  principal  office  or  place 
of  business  of  such  company  is  located,  setting  forth,  in  substance, 
the  grounds  of  their  application,  with  the  names  and  amounts  of 
all  stockholdei-s,  and  the  names  and  amount  due  all  creditors;  and 
the  court  shall  thereupon  direct  that  notice  for  ten  (10)  days  .shall 
be  mailed  to  the  last  and  usual  place  of  residence  of  each  stock- 
holder and  creditor,  and  fix  a  day  in  such  notice  for  a  hearing  of 
such  application  for  dissolution ;  and  the  court,  after  such  notice 
and  a  hearing,  may  decree  a  dissolution  of  such  corporation  and 
appoint  a  trustee  or  receiver  or  receivers  to  wind  up  its  affairs, 
take  charge  of  its  estate  and  effects,  to  collect  debts  and  property 
due  and  belonging  to  such  corporation,  with  jiower  to  prosecute  and 
defend  suits  in  its  name  or  otherwise,  to  appoint  agents  under  such 
receiver  or  receivers,  and  to  do  all  other  acts  which  might  be  done 
by  such  corporation  that  are  necessary  fur  tln'  final  settlement  of 
its  'anfinished  business.  The  powers  of  such  receiver  or  receivers 
may  continue  as  long  as  the  court  deems  necessary  for  said  purposes. 
R.  S.  1901,  §  4595t. 

Jurisdiction  of  Court. 

Section  34.  The  court  shall  have  jurisdiction  of  such  application 
and  of  all  questions  arising  in  the  proceedings  thereon,  and  may 
make  such  orders,  injunctions  and  decrees  and  judgments  therein 
as  justice  and  equity  may  require    R.  S.  1!)()1.  §  4595u. 

Duty  of  Receiver. 

Section  35.  The  receiver  shall  pay  all  debts  due  from  the  cor- 
poration, if  the  funds  in  their  hands  are  sufficient  therefor,  and  if 
not,  they  shall  distribute  the  same  ratably  among  the  creditors  who 
prove  their  debts  in  a  manner  directed  by  any  order  or  decree  of 
the  court  for  that  purpose.  If  there  is  a  balance  remaining  after 
the  payments  of  the  debts,  the  receiver  shall  distribute  and  pay  it 


THE    STATE    OF    J X DIANA  223 

to  and  anioug  those  who  are  justly  entith'd  lliereto  as  Jiaving  been 
stockholders  or  members  of  the  corporation,  or  their  legal  repre- 
sentatives.   R.  S.  IflOl.  S  459r)v. 

Final  Order  for  Dissolution — Duty  of  Clerk  of  Court. 

Section  S6.  When  the  biisines.s  of  such  corporation  shall  have 
been  closed  up,  then  the  court  may  order  and  decree  a  final  dis- 
solution of  the  corporation,  and  the  clerk  of  tlic  court  for  the  county 
in  which  the  decree  or  order  for  dissolnlion  is  nuide  shall  forthwith 
make  such  return  thereof  to  the  secretary  of  state,  giving  the  name 
of  the  corporation  dissolved,  and  the  date  ujjon  which  such  order 
or  decree  was  made,  and  the  secretary  of  state  shall  make  a  memo- 
randum thereof  upon  the  records  in  his  office.    R.  S.  1901.  §  4595w. 

Right  to  Amend  or  Repeal. 

Section  37.  This  act  may  be  repealed  or  amended  at  the  disci-e- 
tion  of  the  legislature.    R.  S.  1901,  §  4595x. 

Laws  Repealed. 

Section  38.  All  law.s  and  parts  of  laws  in  conflict  with  this  act 
are  hereby  repealed;  and  the  following  acts  upon  the  same  subject- 
matter  are  hereby  expressly  repealed,  to  wit : 

The  act  approved  February  20,  1867,  published  on  page  223  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  December  20,  1872,  published  on  page  135  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  26,  1881,  published  on  page  712  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  April  16,  1881,  published  on  page  715  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  April  8,  1885,  published  on  page  145  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  7.  1887,  published  on  page  41  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  6.  1889.  published  on  page  144  of  the 
acts  of  the  General  Assembly  for  that  vear. 


224  FRATERNAL    SOCIETY   LAW 

The  act  approved  March  9,  IS'Jl,  published  ou  page  37U  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  9,  1891,  published  ou  page  385  of  the 
acts  of  the  General  Assembly  for  that  year. 

.The  act  approved  March  :?.  1893.  published  ou  page  289  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  5,  1895,  piiblished  on  page  99  of  the 
acts  of  the  General  Assembly  for  that  year. 

The  act  approved  March  8,  1895,  published  ou  page  168  of  the 
acts  of  the  General  Assembly  for  that  year.     R.  S.  1901,  §  4595y. 

Rights  of  Existing  Corporations. 

Section  39.  That  all  corporations  organized  under  either  of  the 
laws  hereby  repealed  which  would  have  been  legalh'  incorporated 
if  said  acts  had  been  valid  are  hereby  validated  and  legalized,  are 
hereby  continued  in  their  respective  rights,  as  fixed  by  the  law 
under  which  the  same  was  incorijorated,  and  are  hereby  authorized 
to  operate  under  the  provisions  of  this  act,  or  under  the  provisions 
of  the  law  pursuant  to  which  any  such  association  is  organized: 
Provided.  Tliat  the  right  of  the  auditor  of  state  to  supervise  and 
examine  any  such  association  and  of  the  attorn ey-genei-al  to  insti- 
tute the  proceedings  in  this  act  provided  for  shall  be  held  to  apply 
to  all  such  corporations  heretofore,  as  well  as  to  all  such  corpora- 
tions hereafter  organized.    R.  S.  1901,  §  4595z. 

When  Benefits  Exempt  from  Creditors'  Claims. 

Section  40.  All  benefits,  claims  or  interests  on  account  of  certifi- 
cates of  membership,  policies  or  other  evidences  of  interest  in  any 
Masonic,  Odd  Fellow  or  other  benevolent  or  charitable  association, 
society  or  incorporation,  organized  and  incorporated  under  the  laws 
of  this  State,  shall  be  exempt  from  all  claims  of  creditors,  all  .iudg- 
ments,  and  all  other  claims  against  the  holder  of  such  certificate, 
policy  or  other  evidence  of  interest.  All  such  benefits,  claims  or 
interests,  made  for  the  benefit  and  protection  of  the  wife,  child  or 
children,  or  ileiiendeuts  of  parties  so  insiu-od.  or  members  of  such 
societies  so  organized  and  incorporated,  shall  be  for  the  sole  use 


THE    HTATE    OF    IXDIANA  225 

Jlllil  lii'liclit  III'  lllr  |i;il1ii'S  llllllicd  :is  lirlli'H('in  ricS  Ol-  pMVccs  ill  tlic 
|iolir\-  (II'  iM'i-1  ihc.-itc  III'  inciiilicrslii|i  issiii'il  liy  such  society,  ass(i- 
ciation  (n-  iiicdi-poi-itidii  :  I'l-ovidcd,  S\icli  Mssociiitiuii,  society  or 
incorporation  is  oi-iianizcil  Tor  tlie  purjiosc  oi'  in\it\ial  licm^fit.  for 
benevolent  or  cliaritalile  piirposi's,  or  for  the  purpose  of  niiitiial 
life  insurance:  And  provided.  Sucli  lienetits,  claims  or  interests 
arc  made  in  favor  of  the  wife,  child  or  children,  or  other  dependents 
of  the  holder  of  such  certificate,  policy  or  evidence  of  interest:  And, 
IH-ovidcd  further.  That  nothin'j-  in  this  act  shall  be  constnied  to 
affect  the  rights  of  creditors  in  any  policy  of  life  insurance,  where 
the  insured  shall  have  died  previous  to  the  taking  effect  of  this  act. 
R.  8.  VM)1.  S  r)04S. 

Ttiis  section  only  apiilies  to  corporations  organized  nnrter  the  laws  of  this 
State.     Presb.vterian  Fund  vs.  Allen,  106  Ind.  593. 

Venue  of  Actions — Service  of  Process. 

Section  41.  All  suits  on  account  of  benefits,  claims  or  interest 
again.st  societies,  associations  or  incorporations  named  in  the  pre- 
ceding sections,  shall  be  brought,  either  in  the  county  where  the 
jirincipal  office  of  such  societ.v,  association  or  incorporation  is  lo- 
cated, lU'  in  the  count.y  in  which  is  located  the  local  or  subordinate 
branch  or  lodge  of  such  societ.v,  association  or  incorporation,  of 
which  the  person  to  whom  such  certificate  of  membership,  policy 
or  other  evidence  of  interest  was  issued  was  a  member  at  the  time 
of  his  death  or  when  tln^  cause  of  action  accrued.  And  the  service 
of  a  summons  on  the  presiding  officer  of  said  local  or  subordinate 
branch  or  lod,ge  of  such  society,  association  or  incorporation  in 
which  the  membershi])  is  or  was  held  at  the  time  of  tlie  in,iurv. 
disability  or  death  occurs,  shall  be  sufficient  service  on  said  societ.v, 
association  or  incorporation  to  give  the  court  .iurisdiction  in  such 
action. 

As  amended.  Acts  1S99.  p.  117.  R.  S.  1901.  5  5049. 

Right  to  Change  Beneficiary. 

Section  42.     All  certificates  of  membershi]),  policies  or  other  evi- 
dences of  interest  in  an.v  ilasonie.  Odd  Fellow  or  other  benevolent  or 
15 


226  FRATERNAL   SOCIETY   LAW 

charitable  association,  society  or  incorporation  named  in  section  1  of 
this  act.  shall  be  regarded  as  a  contract  between  the  person  whose 
life  is  insured  by  such  certificate  of-  membership,  policy  or  other 
evidence  of  interest,  and  the  association,  society  or  incorporation  of 
which  he  is  a  member;  and  it  shall  be  lawful  for  such  association, 
society  or  incorporation  to  change  the  name  or  names  of  the  payee 
or  payees,  beneficiary  or  beneficiaries  named  in  such  certificate  of 
membership,  policy  or  otlier  evidence  of  interest,  on  such  terms 
and  conditions  as  the  parties  to  the  contract  may  agree  to.  R.  S. 
1901,  S  5050. 

This  section  only  applies  to  corporations  organized  imder  tlie  laws  of  this 
State.     Presbyterian  Fnnd  vs.  Allen,  11)6  Ind.  .593. 

While  the  next  two  sections  do  not  apply  to  Fraternal  Benefit 
Societies,  nevertheless,  the  auditor  of  state,  has  for  some  years  re- 
quired such  societies,  as  a  condition  upon  which  they  have  been 
licensed,  to  agree  to  l)e  governed  by  these  provisions. 

Removal  of  Suits  to  United  States  Court — Commencement  of  Suit 
in  United  States  Court — Forfeiture. 

Every  foreign  corporation  miw  doing  or  transacting,  or  that  shall 
hereafter  do  or  transact,  any  business  in  this  State,  m-  ac(|uire 
any  right,  title,  interest  in.  or  lien  upon  real  estate  in  this  State, 
that  shall  transfer  or  cause  to  lie  transferred  from  any  court  of 
this  State  to  any  court  of  the  United  States,  save  by  regular  course 
of  appeal,  after  trial  in  the  State  courts,  and  action  commenced 
1)\-  111-  against  such  corporation  in  any  court  of  this  State  by  or 
against  any  citizen  or  resident  tliei'eof;  or  shall  commence  in  any 
court  of  the  I'nited  States  in  this  State,  or  any  contract  made  in 
this  State  or  liability  accrued  therein,  any  suit  oi-  action  against 
any  citizen  or  resident  nf  the  State  of  IndiauM — shall  tln^reby  forfeit 
all  ri^ilil  anil  niithnrily  to  i|i>  or  traiisjirl  business  in  this  Stat(»  oi- 
hold  ri'al  jiroperty  or  liens  tliereon  :  and  all  contracts  between  such 
corporations  and  citizens  or  residents  of  this  State,  made  aftei-  the 
passage  of  act.  sluill  be  ri'iiiln'rii  void  as  in  favoi-  of  surh  rnrpora- 
tion.  but  I'liforcrabli'  by  such  rili/i'ii  Ml  bis  I'lrct  inn.  1\.  S.  l!l()l. 
S  .3460. 


THE    STATE    OF    J  N  1)1  AN  A  '221 

Similar  laws  to  this  section  have  been  held  valid.  Morse  vs.  Home.  etc.. 
Co.,  oO  Wis.  496;  State  vs.  Doyle,  40  Wis.  715.  Held  unconstitutional  and 
void  on  appeal  to  U.  S.  supreme  court.  Home,  etc.,  Co.  vs.  Morse,  87  U.  S. 
445;  Doyle  vs.  Continental,  etc.,  Co.,  94  U.  S.  535.  An  injunction  to  restrain 
the  revocation  of  license  because  of  removal  of  a  cause  to  the  United  States 
court  cannot  be  sustained.  Doyle  vs.  Continental,  etc.,  Co.,  94  U.  S.  535.  On 
violation  of  this  act  the  revocation  of  license  is  imperative.  State  vs.  Doyle, 
40  Wis,  220.  Agent  cannot  be  proceeded  against  for  rei)resenling  comiiany 
which  has  not  agreed  to  ijrovision  against  removal.  Baron  vs.  Burnside,  121 
U.  S.  186. 

Conditions  Precedent. 

The  provisions  of  this  act  are  licreliy  iiiach'  comlil  ions  upon  wliicli 
siieh  corporations  may  be  authorized  to  do  busini'ss  in  thi.s  State 
or  hokl  titles  to  or  liens  on  real  estate  therein.    R.  S.  1901,  §  3461. 

Waiver  of  Proofs  of  Loss. 

The  denial  of  lialiility  by  the  iiistirer  within  the  time  fixed  for 
filing  proofs  of  loss  is  a  waiver  of  the  instir^r's  riiiht  to  such  proof's. 

Ohio    Farmers'    Insurance   Co.   vs.    Vogel,    November,    1905,    106    Ind. 
239. 

Waiver  of  Forfeiture. 

Retention  of  the  premiums  on  a  tire  iitsiiraiiee  policy,  after 
knowledge  of  the  breach  of  a  emidition  iiivitig  a  right  of  forfeiture, 
is  held  to  be  an  election  to  disregard  such  breach,  and  to  continue 
the  poliej. 

Ohio   Farmers'    Insurance   Co.    vs.   Vogel,    November,    1905,    166    Ind. 
239. 

Death    From    Exempted    Cause — General    Contract    and    Limited 
Liability. 

Where  a  certificate  on  its  face  insures  against  death  generally, 
but  the  member  executed  an  agreement  at  the  time  of  receiving  the 
certificate,  exempting  the  society  from  liability  for  death  for  a  certain 
cattse.  such  certificate  and  agreement  executed  li\-  the  member  con- 


228  FRATERNAL    SOCIETr    LAW 

stitntes  the  contract,  and  deatli  from  sneli  exempted  cause,  is  not 
covered  by  the  contract. 

Knights  and  Ladies  of  Columbia  vs.  Slioaf.  November,  1905,  IGG  Ind. 
367. 

Special  Agreements  Limiting  Liability. 

An  agreement  which  is  part  of  a  life  insurance  contract,  exempt- 
ing the  society  from  liability  from  death  arising  from  jjregnaney, 
exempts  it  from  liability  from  death  caused  by  puerperal  septicemia. 

Knigiits  and  Ladies  of  Columbia  vs.  Shoaf.  November,  1905,  166  Ind. 
367. 

Doing  Business  Without  License — Validity  of  Contracts. 

A  legislature  of  a  State  is  powerless  to  ]irohil)it  a  citizen  from 
executing  a  contract  of  insurance  outside  of  such  State  on  i)roperty 
inside  thereof.  This  doctrine  is  announced  in  an  important  fire  in- 
surance case,  where  the  company  was  not  authorized  to  do  business 
under  the  laws  of  the  State,  and  will  be  interesting  to  societies  that 
may  make  contracts  with  citizens  of  States  where  they  ai'e  not 
licensed. 

Swing  vs.  Hill,  May,  1905,  165  Ind.  411. 

Waiver  of  Proofs  of  Loss. 

A  condition  in  an  accident  policy,  requiring  proofs  of  injury  to 
be  made  within  90  days  of  the  happening  of  the  accident,  being  en- 
tirely for  the  benefit  of  the  insurer,  may  be  waived  by  it,  and  very 
slight  circumstances  are  suflficient  evidence  of  the  intention  of  the 
insurer  not  to  take  advantage  of  the  breach,  or  to  insist  njion  a  for- 
feiture. 

National  Masonic  Accident  Ass'n  vs.  McBride.  March,  1904.  162  Ind. 
379.  11 


THE    STATE    OF    INDIANA  229 

Prompt  Payment  of  Premiums. 

Where  :i  coiiti'iiet  jji'ovidi'd  lli.il  I'Miliiri'  Ui  |i;iy  the  pi'einiuiii  on  a 
day  certain  should  work  forfeiturr  of  the  coiitraet,  an  allegation  in 
the  complaint  filed  in  an  action  on  a  (Mudi'Met.  that  the  policy  was  not 
delivered,  and  did  not  take  effect  until  live  clays  after  its  date,  is 
not  sufKcient  to  sliow  a  ehaiiuc  in  the  conti-ael  as  to  the  tiuie  of 
the  i)ayment  of  premiums,  and  avoid  a  forfeiture  of  the  ijolicy  for 
failure  to  pay  the  premium  at  the  time  stipidated  therein. 

Tibbits  vs.  Mutual  Benetit  Life  Ins.  Co.,  .January,  190",  159  Ind.  671. 

Service  of  Process  Upon  Local  Lodge  Officers. 

In  an  action  against  a  foreign  sociely  (ui  a  benefit  certificate,  it 
was  held  that  service  of  process  on  the  chief  officers  of  the  local 
lodge  was  sufficient,  where  such  society  had  failed  to  comply  with 
the  statute  by  filing  with  the  auilitor  of  the  State  its  consent  that 
service  of  process  might  be  made  upon  such  officer. 

Modern  Woodmen  of  America  vs.  Noyes,  May.  1902.  15S  Ind.  .503. 

General  Promise  to  Pay — Defenses  Need  Not  Be  Negatived. 

Where  in  a  certificate  a  promise  to  pay  is  general,  it  is  not  neces- 
sary in  a  suit  upon  the  certificate  that  the  complaint  should  negative 
a  provision  of  non-liability  in  the  nature  of  an  excejition,  since  that 
is  a  matter  of  defense. 

Modern  Woodmen  of  Ameiics  vs.  Noyes,  May,  1902.  1.5S  Ind.  503. 

Are  Members  Debtors  to  the  Society — Levying  Assessments  Upon 
Them. 

The  assessments  against  menibei-s  of  a  society  for  the  lienefit  of  a 
beiiefici;iry  of  a  deceased  member  cannot  be  enforced  by  suit,  where 
the  only  penalty  provided  in  the  ccuitract  for  non-payment  was  a 
ftu'feitnre  of  the  defaulting  member's  certiticate  and  of  all  rights 
thereunder.  The  facts  in  this  case,  in  brief,  were:  That  the  appel- 
lant   for   herself   and    others   began    ;iii    miction    against   the   trustees 


230  FRATERNAL    SOCIETY    LAW 

of  the  .Mfi.siinic  .Alutiial  Heiielit  Society  of  tiie  State  of  Indiana. 
Avhereiii  the  appellant  sought  to  have  the  appellees  ordered  to  levy 
and  collect  assessments  trom  members.  The  trustees  of  the  society, 
M'ere  acting  as  such  under  an  order  of  court,  and  the  appellants 
sought  to  have  a  collection  made  fi'om  the  members  liv  assessments 
of  a  s)im  sufficient  to  pay  the  death  losses  remaining  unpaid.  The  pe- 
tition was  demurred  to,  and  the  denuirrer  sustained.  The  opinion 
is  lengthy,  and  discusses  many  authorities  adhering  to  the  general 
doctrine,  that  the  levy  of  assessments  as  a  general  rule  does  not 
serve  to  make  the  members  of  a  fraternal  society  debtors  to  the 
society  so  as  to  authorize  the  latter  to  enforce  demand  thereof  by 
suit.  Cases  cited  as  sup])orting  tln'  coiicliisinn  of  the  court  are  the 
following. 

Lerman  vs.  Clark.  174  111.  279;   51  N.  E.  222;    43  L.  R.  A.  648: 

Clark  vs.  Scliromeyer.  23  Ind.  App.  565; 

In  Re  Protection  Life  lus.  Co.,  9  Bis.  ISS; 

2  Bacon  on  Benefit  Societies.  See.  357. 

Niblack  on  Mut.  Benefit  Societies,  276: 

State  vs.  Merchants,  etc..  Society,  72  Mo.  146; 

Commonwealth  vs.  Wetherbee,  105  Mass.  149; 

Rood  vs.  Railway,  etc.,  Assn.,  31  Fed.  62. 

The  eases  opposing,  or  seeming  to  oppose  the  conclusions  reached 
by  this  court,  are  considered  and  distinguished. 

Gibson  vs.  Megrew,  March.  1900,  154  Ind.  273. 

Members  Cannot  Sue  to  Prevent  Issuance  of  Special  Contracts  by 
the  Society. 

Wiiere  an  insurance  company  is  regularly  organized  and  lawfully 
doing  i)usiness,  a  court  of  general  jui'isdiction  has  no  ])ower  upon 
the  ap])lica1ion  of  a  member  to  enjoin  the  issuance  of  sjiecial  con- 
tracts of  insurance,  since  the  statute  provides  that  a  court  shall 
have  no  jinwer  to  interfere  with  the  business  of  such  company,  ex- 
ce])t   upon  Ihc  application  of  the  Attorney  General. 

Lowery  vs.  State  Life  Ins.  Co.,  .luly.  1S99.  153  Ind.  100. 


THE    KTATE    OF    JXDfANA  231 

Members  May  Sue  to  Prevent  Society  Paying  Invalid  Claims. 

A  policy  hdldiT  in  ;j  iiiiitii:il  life  iiisui'Miici'  society  iii;iy  iii.'i  iiilaiii 
M  suit  to  ciijoiii  the  society  IVom  pnyiiiL:  .-in  iii\;iliil  chiiiii.  wlici'c  it 
is  shown  that  the  society'  has  ;iccuiiuiiatc(l  and  is  acciuinUat iiiji'. 
from  the  assessments  collected  from  its  members,  a  fund  for  the 
henetit  of  all  inembers,  from  which  fund  the  contracts  are  paid  at 
the  time  of  the  death  of  members,  and  from  which  fund  dividends 
are  distributed  to  members,  and  added  to  their  certificates. 

Carmien   vs.  Cornell  May.   1897.  14.S   Ind.   S3. 

Suit  by  Beneficiary  Against  Third  Person  to  Whom  the  Benefit  Was 
Paid. 

An  action  cannot  be  maintained  b_\-  a  beneticiary  against  a  third 
jierson  to  whom  the  amount  ilue  was  paid,  foi'  the  recovery  of  the 
amount  paid,  where  it  is  not  shown  that  the  defendant  assumed  to 
act  for  the  plaintiff  in  receiving  the  money,  but  collected  same 
from  the  company  upon  a  claim  of  right  luider  an  alleged  assign- 
ment of  the  insurance  contract. 

Schultz  vs.  Boyd.  February.  1899,  152  Inci.  166. 

Physician  Not  Privileged  Witness. 

Where  the  assured  agreed  in  his  application  for  insurance  that 
his  physician  might  testify,  his  adininistrator  cannot  object  to'  the 
competency  of  such  physician   as  a   witnes.s. 

Met.  Life   Ins.  Co.  vs.  WlUis.  Nov.,  1905.  37  Inci.  App.  48. 

Warranty  as  to  Good  Health. 

For  an  interesting  case  discussing  warranty  as  to  good  health 
and  previous  state  of  health,  and  to  knowledge  of  agent  of  the 
falsity  of  statements  contained  in  an  application  for  insurance,  see 

Met.  Lite  Insurance  Co.  vs.  Willis,  November.  1905,  37  Ind.  App.  48. 


232  FRATERNAL    SOCIETY    LAW 

Vested  Interests. 

The  beneficiary  lias  only  a  contingent  interest  in  the  lienefit  cer- 
tificate prior  to  the  member's  death. 

Grand  Lodge  A.  O.  U.  W.  vs.  Hall,  November,  1905.  37  Ind.  App.  371. 

Admissions  of  Members. 

As  a  general  rule  admissions  of  a  member  are  not  admissible 
against  the  beneficiary,  and  this  rule  applies  to  benefit  societies  as 
well  as  to  ordinary  life  insurance  companies. 

Grand  Lodge  A.  O.  U.  W.  vs.  Hall.  November,  1905.  37  Ind.  App.  371. 

Averments  of  Performance  Requisite  in  Pleading. 

To  authorize  a  recovery  by  a  beneficiary  named  in  a  certificate. 
it  must  be  shown  by  the  complaint  that  the  member  performed  tin- 
requirements  of  the  constitution  and  by-laws,  and  an  averment  that 
the  beneficiary  performed  all  the  conditions  and  requirements  is 
insufficient. 

Grand  Lodge  A.  0.  U.  W.  vs.  Hall,  November.  1905.  37  Ind.  App.  371. 

Suicide — Presumptions — Facts  for  Jury. 

Suicide  cainiot  he  ])resumed  from  death  in  an  unknown  inaniun'. 
where  it  is  ])ossible  that  such  death  may  be  due  to  accident,  negli- 
gence, or  mistake ;  the  burden  of  proving  suicide  being  upon  the 
one  alleging  it.  Where  it  was  shown  that  the  insured  wa.s'  found 
dead  with  a  bottle  partlx'  filled  with  rarbolic  acid  in  his  vest  pocket, 
a  large)'  bottle  of  sanu'  tliluted  with  water  near  the  body:  that  he 
had  ])i'ocure(l  such  acid  for  the  purj)0se  of  treating  his  face,  wishinu 
to  cnri'  |)ini|ilcs.  and  evidence  of  the  presence  of  such  acid  in  the 
mouth  and  stonia<'li.  l)eiug  in  cOnfiict.  and  it  I'lirtliei'  being  shown 
that  the  mrinlier  had  previously  sufi'ered  a  sun-stroke,  and  that  the 
day  of  the  death  was  an  uiuisually  warm  one,  the  suicide  was  a  (pies- 
tion  of  I'aet   to  lie  passed  upon  liy  the  jury. 


THE  STATE  OF  INDIANA  283 

Equitaljle  Life  Ins,  Co.  of  Iowa  vs.  Herbert.  February.  1906,  37   Ind. 
App.  373. 

Amendment  of  Laws  After  Cause  for  Benefits  Accrue. 

'I'lic  MiiU'iuliiU'iit  o\'  I  III'  hiw's  (iT  ;i  scicicly  mI'Iit  the  iiiciiilic'f  has 
riH'eivi'd  iiijiii-ics.  whicli  exccpl  I'ur  the  MJiiendiiieiil  woiihl  entitle 
the  iiieinber  to  benehls.  (h)es  iml  relie\e  the  society  t'roni  payment 
of  such  benefits. 

Brotherhood  of  Painters,  ote.  vs.  Moore.  November.  Ifl05.  3G  Ind.  App. 
580. 

Right  to  Forfeiture  Waived. 

AViuM'e  the  eonstitiitidii  nl'  n.  society  pi-ovides  sipitinst  liat)ility 
where  ;i  member  eiiyaii''s  in  hazardotis  occupations,  and  where  the 
meiuiier  has  notitied  tlie  society  that  he  is  engaged  in  such  occupa- 
tion, and  lie  continues  to  pay  his  dues,  which  are  accepted  by  the 
society,  it  was  held  that  thi'  society  had  elected  to  i-etain  the  mem- 
.  ber.  and  to  disre<;;ii'd  the  pri)\-isiiin. 

Brotherhood  of  Painters,  etr.  vs.  Moore,  November,  190.5.  36  Ind.  App, 
580. 

Agents — Imputing  Knowledge. 

The  local  officers  arc  held  to  be  the  agents  of  the  general  lodge  to 
do  whatever  the  constitution  of  the  latter  require  of  them,  and  that 
their  knowledge  gained  while  in  the  performance  of  that  d\ity  is  to 
be  imputed  to  the  general  lodge. 

Brotherhood  of  Painters,  etc.  vs.  Moore.  November-.  1905,  36  Ind.  App. 
580. 

No  Vested  Interests  in  Certificate. 

A  beneficiarv  named  in  a  certificate,  issued  to  a  member  by  the 
Supreme  Lodge  Knights  of  Honor,  does  not  acquire  by  reason  of 
that  fact  alone  a  vested  interest  in  such  certificate,  since  the  assured 


234  FRATERNAL    SOCIETY   LAW 

may  change  the  beneficiary  at  will,  in  accordance  with  the  rules  of 
the  society. 

Carter  vs.  Carter,  November.  1904,  35  Ind.  App.  73. 

Beneficiary— Change  of  Through  Fraud. 

The  by-laws  provided  that  a  member  might  receive  a  new  certifi- 
cate if  the  original  were  "lost  or  beyond  his  control,"  and  where 
it  was  shown  b.y.the  member's  affidavit  that  his  certificate  was  lost, 
or  beyond  his  control,  and  he  executed  an  ante-nuptial  contract, 
makinu-  his  intended  wife  his  beneficiary,  and  subsequent  to  his  mar- 
riage he  procured  his  certificate,  to  be  issued  payable  to  her  and  where 
STich  member  afterwards  liy  a  false  affidavit  ]n-ocured  a  new  certifi- 
cate payable  to  his  brother,  such  wife  named  under  the  circum- 
stances was  held  to  be  the  original  owner  of  the  insurance.  This 
was  a  case  where  the  society  paid  the  fund  into  court  under  a  bill  of 
inter])leader. 

Carter  vf.  Carter,  November.  1904,  35  Ind.  App.  73. 

Death  Before  Contract  Became  Binding. 

The  application  for  insurance  was  made  on  Ajiril  ."ith.  and  pro- 
vided that  no  contract  should  be  eft'ective  until  the  policy  was  issued 
and  delivered  while  the  member  was  in  good  health.  The  applicant 
died  on  April  8th.  and  the  company,  in  ignorance  of  the  death, 
mailed  the  policy  on  A])ril  Dth.  Held  that  there  was  no  liability 
under  the  policy. 

Reserve  Loan  Life  Ins.  Co.  vs.  Hockett,  March.  1905,  35  Ind.  App.  S9. 

Agency — Waiver  and  Estoppel. 

A  local  oflicer,  who  collects  the  tlues  from  the  members  of  a  local 
lodge,  and  transmits  them  to  the  grand  lodge,  is  to  be  deemed  the 
agent  of  the  <irand  lodtie,  nevertheless  the  latter  is  not  estopped 
from  declarinj;'  a  foi'feitui'e  from  subseqiient  defaults,  since  the 
agent  cannot  bind  his  princi|)al  by  any  unaiithorized  act. 


THE    STATE    OF    INDIANA  235 

Supreme  Lodge  Knights  oi  Honor  vs.  Jones,  January,  1904,  35  Ind. 
App.  121. 

Forfeiture — Unreasonable  By-laws. 

The  court  held  that  the  fdlldwiiii;'  li\'-l;i\v  was  not  so  oppressive 
and  unreasonable  as  to  be  iUeual:  "When  a  member  owes  a  .sum 
eipud  lo  three  mouths"  dues,  he  is  uol  in  u'ood  standing,  and  is 
thereby  suspended  from  all  benelits  in  the  interim,  and  will  not  be 
again  entitled  to  benefits  until  three  numths  after  all  his  arrearages 
ai'e  paid  in  full. " 

United  Brottierliood  of  Carpenters  and  Joiners  of  America  vs.  Dinlvle, 
January.  1904,  32  Ind.  App.  273. 

Prompt  Payment  of  Assessments. 

The  insurance  in  mutual  benefit  or  fraternal  societies  ordinaril.y 
lasts  only  from  the  maturity  of  one  assessment  to  the  maturity  of 
another,  and  therefore,  stipulations  to  insnre  prompt  payment  by 
the  members  are  of  the  substance  and  essence  of  snch  contracts. 
The  obligations  of  fraternal  societies  and  their  individual  members 
are  reciprocal,  and  both  must  comply  with  the  laws  of  the  society. 

Supreme  Lodge  Knights  of  Honor  vs.  Jones,  January,  1904,  35  Ind. 
App.  121. 

Payment  of  Assessment  After  Forfeited  Member's  Death. 

Where  the  laws  provide  that  a  membei-  failing  to  pay  an  assess- 
ment shall  stand  suspended,  and  shall  not,  therefore,  be  entitled  to 
the  benefit,  unless  reinstated,  and  where  a  member  failed  to  pay  an 
assessment  due  and  payable  at  maturity,  he  is  not  in  good  stand- 
ing on  IMarch  10th,  and  payment  of  the  assessment  after  death  of 
the  member,  by  the  beneficiary,  will  not  revive  a  forfeited  contract. 

Supreme  Lodge  Knights  of  Honor  vs.  Jones,  January,   1904.  35   Ind. 
App.  121. 


236  FRATERNAL    SOCIETY    LAW 

Forfeiture — Payment  of  Delinquent  Amount. 

Where  it  was  sluiwu  that  a  meiiiber  of  the  IvHight.s  of  Honor 
failed  to  pay  an  assessment  at  the  time  fixed  by  the  by-laws,  that 
after  the  member's  deatli  siieh  asses.smeiit  was  paid  to  the  society's 
local  collector,  who  returned  same  upon  learning  of  such  member's 
death,  a  verdict  and  judgment  against  the  society  in  favor  of  the 
member's  beneficiary  cannot  be  sustained. 

Supreme  Lodge  Knights  of  Honor  vs.  Jones,  January,  1904,  35  Ind. 
App.  121. 

No  Vested  Interests  in  Beneficiary — Change  of  Beneficiary. 

A  beneficiary  in  a  fraternal  society  acquires  no  vested  interest 
in  the  certificate  until  tlie  death  of  the  member,  and  such  member 
may.  without  the  benefieiar>  's  eonseut.  make  a  new  a|i|)iiintmeut  of 
l)enefieiary.  unless  prevented  by  the  organie  biw  or  rules  and  regu- 
lations of  the  society. 

Bunyan  vs.  Reed.  May,  1904.  34  Ind.  App.  295. 

No  Vested  Interests — Failure  to  Name  New  Bepeficiary. 

A  menilier  of  the  National  I'nion  obtained  a  .$5.0011.00  certificate, 
wliieli  lu'  had  made  pa>-able  to  a  lu'otlier  to  secure  to  such  brother 
for  money  due  him  from  the  member,  the  sum  of  $3,000.00,  and  to 
each  of  the  member's  two  .si.sters  the  sum  of  .$1,000.00.  and  where 
such  brother  i)redeeea.sed  the  member,  and  the  by-laws  of  the  soci- 
ety pi-ovided  that  n|iiin  the  death  of  a  beneficiary,  the  lienelit  should 
he  |)aid  to  the  surviving  l)eneHeiai-y  or  lieneficiaries.  each  sharing 
pro  I'ata.  unless  otherwise  |)i'ovided  in  the  lienefit  certificate,  it  was 
lield  thai  tiu'  two  sisters  named  were  entithnl  to  tiu'  benefit,  antl  that 
sneh  (h'ceased  bi'(itliei-'s  adniinistratcu'  was  not  entitled  to  any  |iart 
there()f. 

Bunyan  vs.  Reed.  May.  1904.  34  Ind.  App.  295. 

Laws  Are  Part  of  Member's  Contract. 

.\    nienibel'  111'  a    IV.'ilerual   siieiely   lal\es  a   cerlilicate  subject    to   tile 


TllK    t^TATK    OF    IMllA.\A  237 

reason<il)le  rules,  laws,  and  reg'ulatinns  (if  llic  society,  and  the  saiiir 
form  a  part  of  his  contract  of  insurance. 

Buiiyan  vs.  Reed,  May.  1904,  34  rnd.  App.  295. 

Habits   of  Members — Breach   of  Promissory  Warranty — Excessive 
Indulgence  in  Liquor. 

Where  the  insui-ed  warranted  lliat  lie  would  not  iisi'  inlo.xicatinic 
liquors  to  excess,  nor  practice  any  i)eriucious  lial)it  that  tended  to 
shorten  life,  and  jiayiuent  of  the  policy  was  contestetl  on  the  ground 
that  the  insured  drank  to  excess,  it  was  error  to  instruct  the  jury: 
that,  if  they  found  from  tlic  natin-e  of  the  miuiilier's  employment, 
that  his  physical  condition  was  occasioned  thereby,  that  he  became 
weak  and  exhausted,  and  was  compelled  to  and  did  resort  to  .stimu- 
lants, as  he  believed,  for  his  own  protection,  and  to  enable  him  to 
continue  his  hd^ors.  and  in  so  doing-  occasionally  draidc  li(iiR)rs  even 
to  the  extent  of  being  luuler  the  influence  of  such,  then  the  indul- 
gence could  not  be  termed  excessive,  and  could  not  he  urged  as  a 
defense,  unless  you  further  find  that  such  indulgences  were  ex- 
cessive, and  that  it  tended  to  or  did  shorten  his  life;  since  the  in- 
struction left  it  with  the  memhei'  to  ih'termine  for  himself  what 
would  be  an  excessive  use  of  liquors. 

Union  Life  Ins.  Co.  vs.  Jameson,  April,  1903,  31  Ind.  App.  28. 

Necessary  Averments  in  Petition. 

To  entitle  the  heneficiary  to  recover  the  anunuit  stated  in  a  cer- 
tificate, it  is  essential  that  the  complaint  show  by  ex])ress  averment 
full  performance  of  all  coiulitions  imjiosed  by  the  contract  of  in- 
surance and  the  laws  of  the  society,  or  by  facts  showing  such  con- 
ditions to  have  been  waived,  and  an  allegation  that  a  member  was, 
at  the  time  of  his  death,  in  good  standing  and  entitled  to  all  the 
rights  and  jirivileges  of  membership  does  not  supply  the  necessary 
averment  of  jierformance  of  all  conditions,  since  it  is  only  a  state- 
ment of  a  conclusion. 

Grand  Lodge  A.  0.  U.  W.  vs.  Hall,  May,  1903,  31  Ind.  App.  107. 


238  FRATERNAL    SOCIETY    LAW 

Resort  to  Civil  Courts. 

A  member  is  uot  required  to  exhaust  his  remedies  within  the 
society  before  resorting  to  the  courts,  unless  the  by-laws  of  the 
society  make  it  obligatory  upon  him  to  do  so. 

Supreme  Lodge  Knights  of  Pythias  vs.  Andrews,  June.  1903.  31  Ind. 
App.  422. 

Diiferent  Classes  in  Same  Society — Right  of  Members  to  Transfer 
From  One  Class  to  Another. 

For  the  facts  in  a  case  where  it  was  cliarf;ed  that  a  member  had 
been  arbitrarily  refused  transfer  upon  application  to  a  class  in  a 
society  of  which  he  was  already  a  member,  to  which  class  he  claimed 
he  was  entitled  to  be  transferred,  see 

Supreme  Lodge  Knights  of  Pythias  vs.  Andrews.  June.  1903,  31  Ind. 
App.  422. 

Forfeitures — Duty  of  Court  to  Declare. 

Forfeitures  are  not  favored  by  law,  but  nevertheless  it  is  the 
duty  of  courts  to  declare  a  forfeiture  upon  facts  which  will  admit 
of  no  other  conclusion.  For  the  facts  in  evidence  in  an  interesting 
forfeiture  ease,  see 

Grand  Lodge  A.  O.  U.  W.  vs    Marshall.  October,  1903,  31   Ind.  App. 
534. 

Forfeiture  of  Member — Self-executing  Provisions. 

Where  the  laws  of  a  society  provide  that  a  faihire  by  the  member 
to  pay  an  assessment  within  a  stipulated  time  operates  as  a  for- 
feiture of  membership,  no  affirmative  action  on  the  part  of  the 
society  to  suspend  delinquent  members  is  required. 

Grand  Lodge  A.  0.  U.  W.   vs.  Marshall,   October,  1903,  31   Ind.  App. 
534. 


THE    STATE    OF    INDIANA  239 

Agent's  Knowledge  Imputed  to  Principal. 

Knowledge  possessed  by  iiii  agent,  acquired  by  him  in  perform- 
ance of  his  duties  as  as'ciil  is  to  he  imjiuted  to  liis  principal. 

Supreme  Court  of  Honor  vs.  Sullivan.  January,  1901.  2i;  Ind.  App.  GO. 

Agency — Waiver  by  Agent — Imputed  Knowledge. 

A  court  in  coustruiug  a  provision  of  the  laws  of  a  society  which 
read,  "it  is  expressly  understood  that  the  district  recorder  is  an 
agent  of  tlie  district  court,  aiul  not  an  agent  of  the  supreme  co\u't, 
to  do  anything,  except  such  acts  as  are  specifically  authorized  in  the 
fundamental  laws ; ' '  Held,  that  where  in  such  a  case  the  recorder 
of  the  local  lodge  had  authority  to  collect  from  the  members,  assess- 
ments when  due,  giving  receipts,  and  forwarding  the  payments  to 
the  supreme  body,  that  such  recorder  was  the  agent  of  the  supreme 
body  as  between  it  and  the  members  in  doing  the  duties  imposed 
by  the  latter,  and  that  he  had  autluu-ity  to  waive  the  forfeiture  of 
a  certificate  by  the  acceptance  of  dues  and  assessments  with  knowl- 
edge of  the  forfeiture.  The  case  in  point  was  one  where  the  mem- 
ber had  engaged  in  a  prohibited  occupation,  and  knowledge  of  that 
fact  had  come  to  the  district  recorder,  and  the  court  iiu]nited  such 
knowledge  to  the  society. 

Supreme  Court  of  Honor  vs.  Sullivan.  January.  1901.  I'ti  Ind.  App,  60. 

Privileged  Communications — Physician  and  Patient. 

Statements  made  by  a  member's  physician  in  his  presence  as  to 
his  condition,  and  accpiiesced  in  by  him  may  be  proven  as  admis- 
sions by  him.  A  conversation  between  a  physician  and  his  patient 
in  the  presence  of  a  third  person  is  not  a  privileged  communication 
between  patient  and  physician,  and  such  third  person  may  testify 
as  to  what  was  said,  if  it  is  otherwise  admissible. 

Mason's    Fund   Life   Insurance   Assn.   vs.   Brocknian.    January.    1901. 
26  Ind.  App.  182. 


240  FRATERNAL    SOCIETY    LAW 

Suicide — Death  From  Intemperance. 

For  an  interesting  case  discnssing  testimony  under  the  defense 
of  death  by  suicide,  and  also  death  resulting  from  intemperance, 
and  the  contract  provisions  bearing  upon  such  defense,  see  the 
following: 

Supreme  Lodge  Knights  of  Pythias  vs.  Foster,   March  7th.  1901,   26 
Ind.  App.  333. 

Sick  Benefits — Total  Disability, 

A  member  wlm  during  the  time  for  \\iiich  he  claimed  sick  in- 
denniit.A".  was  mi  account  of  siclvuess  wholly  disabled  ;nid  prevented 
from  participating  in  all  kinds  of  business,  does  not  forfeit  his 
right  to  indemnity  by  leaving  his  room  under  the  instructions  of 
a  physician  for  the  benefit  of  his  health. 

Cohniibian  Relief  Fund  Assn.  vs.  Gross,  April.  1900,  25  Ind.  App.  215. 

Forfeiture^ — Waiver  and  Estoppel — Members  Engaging  in   Prohib- 
ited Occupation, 

AVhere  the  local  olflcers  received  the  dues  and  assessments  of  a 
member  after  he  had  engaged  in  the  liquor  traffic,  with  the  knowl- 
edge of  such  fact  and  after  the  society  had  received  his  last  pay- 
ment, with  the  knowledge  of  the  further  fact  that  the  meiuber  died 
while  so  engaged  in  the  licpior  traffic,  the  society  will  be  estopped 
from  asserting  a  forfeiture  of  the  certificate  under  the  law  jn-oliibit- 
ing  members  from  engaging  in  the  licpior  business. 

Supreme  Tent  Knights  of  the  Maccabees  vs.  Volkert,  November.  1900, 
25    Ind.    App.   627. 

Conflict  Between  Terms  of  Certificate  and  By-laws. 

Where  there  are  contlicts  between  the  terms  of  a  certificate  and 
by-law  provisions,  the  court  will  ado]it  that  provision  which  will 
give  the  greatei-  rigid  to  the  member  and  his  beneficiary. 


THE    HTATK    Ob'    J X DIANA  241 

Supreme  Tent  Knights  ol'  the  IVliii'caljecs  vs.  VolUert.  November.  1900, 
25    Intl.    Apii.    (i27. 

Agency  of  Local  Officers. 

IjocjiI  officers  wlm  i-ollcct  .-iiid  ti-.-iiismit  iiicnilirr's  pa yiiiciits  are  to 
he  (leoiied  agents  of  the  su|irriHr  liody.  mil  wil  hslaiiiliiii;-  jjrovisioiis 
of  the  laws  to  the  contrary. 

Supreme  Tent  Knights  of  the  Maccabees  vs.  Volkert.  Novemljer.  1900, 
2.5    Ind.    App.    (527. 

Suicide — Presumptions  in  Favor  of. 

In  a  suit  u|ion  a  eertitieate  exempting-  the  society  from  liability 
for  death  liy  snieide,  the  evidence  showed  that  the  member  and  bis 
wife  lived  together  in  a,  liouse  bi;ilt  on  a  lot  owned  by  the  wife; 
that  the  wife  brought  a  suit  for  divorce,  charging  her  Imsband  with 
drunkeinies.s  and  cruel  treatment,  and  i)rocured  a  restraining  order 
prohibiting  liim  from  returning  to  his  home ;  that  the  member  dis- 
appeared a  few  daj's  later.  His  hat  was  found  on  the  banks  of  a 
stream  at  an  unfrequented  place,  and  tracks  made  by  some  person 
going  into  the  stream  were  also  found,  and  no  tracks  were  found 
where  the  member  had  come  out  of  the  water ;  the  body  of  the 
member  Avas  found  with  no  marks  u])on  it.  and  no  evidence  of 
violence,  it  wa.s  held  that  the  evidence  excluded,  with  reasonable 
certaint.v  an.v  hypothesis  of  death  by  aii.v  other  cause  than  by 
suicide. 

Sovereign  Camp  Woodmen  of  the  World  vs.  Haller.  Feb.  1900.  24  Ind. 
App.   108. 

Agency  of  Collecting  Officer. 

A  local  officer  recpiired  to  collect  dues  from  the  members,  and  to 
transmit  them  to  the  supreme  body  is  the  agent  of  the  latter  in  doing 
whatever  the  laws  require  him  to  do,  as  between  the  members  and 
the  societ>'. 

Supreme  Tribe  of  Ben  Hur  vs.   Hall,  March,  1900,  24  Ind.  App.  316. 
16 


24i^  FRATERNAL   SOCIETY    LAW 

Forfeiture — Waiver  of  by  Agent. 

Forfeiture  of  a  certificate  on  account  of  the  inni-payment  of  dues 
may  be  waived  by  the  officers  charged  with  the  duty  of  collecting- 
the  dues,  by  the  officer  demanding  and  receiving  dues  after  the 
death  of  a  forfeited  member,  witli  knowledge  of  his  forfeiture  and 
death. 

Supreme  Tribe  of  Ben  Hur  vs.  Hall,  March,  1900,   24  Ind.  App.  316. 

Change  of  Beneficiary. 

If  the  holder  of  a  certificate  does  all  in  his  power  to  effect  a 
change  in  beneficiary,  in  accordance  with  the  by-laws  of  the  soeiet.y, 
such  change  will  be  effected,  although  such  by-laws  are  not  strictly 
comi)lied  with. 

Isgrigg  vs.  Schooley,  125  Ind.  94. 

No  Vested  Interests  in  Beneficiary. 

Persons  named  as  beneficiaries  in  certificates  have  no  vested  rights 
therein  until  the  death  of  the  member  holding  the  certificate. 

Masonic  Society  v.   Burkhart,   110   Ind.   1S9;    Milner  v.   Bowman.  119 

Ind.   44S. 
Also,   see  Wright  v.  Wright,  inii  Tenn.  313. 

Change  of  Beneficiary — Assignment  of  Certificate. 

When  there  is  no  prescribed  mode  for  changing  the  beneficiaries 
in  a  certificate,  an  assignment  of  the  certificate  will  have  the  effect 
of  making  such  change. 

.Milner  v.   Bowman,   119   Ind.  44S. 

Agency — Waiver  of  Grounds  of  Forfeiture  by. 

Where  the  agent  of  a  company  is  aulhoi-izcd  to  solicit  ajjplica- 
tions  and  collect  premiums,  and  eontinncs  to  collect  premiums  from 
the    insiifed,    with    the   '■     i\\-ledL!'o    that    ho    was   using   into    icating 


THE    STATE    OF    INDIANA  243 

liquors  to  excess  in  violjition  of  llic  lo-iiis  nf  tlif  pnlicy,  such  action 
amounted  to  n  waiver  ot  a  riylil  to  ilcelare  a  iortViture,  although 
sucli  I\nowl('(l^(>  of  the  as'ent  was  not  communicated  to  the  company. 

Northwestern   Masonic  Aid   Association   vs.   Bodnrtlia.   May.   1S99,  23 
Ind.  App.  121. 

I 

Promissory  Warranty. 

An  ai)i)lication  for  insurance  containing  questions  and  answers 
in  the  Medical  Examiner's  report  and  an  agreement  reciting  tliat 
the  statements  and  answers  in  the  application  were  to  be  madi; 
a  part  of  the  policy  and  form  part  of  the  insurance  contract,  and 
which  contained  an  agreement  that  the  insured  would  abstain  from 
the  excessive  use  of  intoxicating  liquors  was  held  to  be  a  promis- 
sory warranty  and  not  the  statement  of  an  expectation. 

Nortliwestern  Masonic  Aid  Association  vs.  Bodurtha,  May,  1899,  23 
Ind.  App.  121. 

A    Promissory    Warranty    Requires    Cessation    From    a    Previous 
Practice. 

The  fact  that  an  insurance  company  knew  that  the  assured 
was  in  the  habit  of  drinking  intoxicating  li(|U(irs  to  excess  prior  to 
the  issuance  of  the  policy  will  not  prevent  the  company  from  mold- 
ing payment  on  the  ground  of  a  breach  of  n  ])romissory  warranty  not 
to  drink  intoxicating  liquors  to  excess. 

Nortliwestern  Masonic  Aid  Association  vs.  Bodurtlia.  May,  1S"9,  23 
Ind.  App.  121. 

Admissions  of  Member  Not  Sufficient  to  Defeat  Claim  of  B-'^efi      ry. 

Statements  or  admissions  made  l)y  the  insured  and  not  -^ml  lied 
in  the  contract  are  not  admissible  in  evidence  in  an  ;'cti  ■  '  a 
policy  for  the  purpose  of  defeating  the  rights  of  beneficii- ■^• 

The  Mason's  Union    Life  Insurance  Association  vs.  Br"-  ay, 

1898,  20  Ind.  App.  206. 


2i4  FRATERNAL    SOCIETY    LAW 

Eights  of  Minority  of  Lodge  Where  Majority  Secede. 

Where  the  lUiijurity  of  the  iiiemhers  of  ;i  subordinate  lodge  with- 
drew from  the  jiirisdietioii  of  the  Grand  Lodge — The  Iiidei)eiideut 
Order  of  Foresters — the  minority  who  continued  steadfast  in  tlieir- 
allegiance  to  the  society,  are  as  against  tlie  maj(irit\'.  entitled  to 
the  ]ir()])erty  of  the  lodge. 

Ahlendorf   vs.   Barkoiis.   October,    1898.   20    Inrt.   App.    ti57. 

Beneficiary — Designation  of. 

\Vhere  tlie  hy-laws  of  a  mutual  benefit  a.ssociation  jn-ovide  that 
members  upon  admittance  who  desire  to  participate  in  the  benefit 
fund  shall  designate  a  beneficiary  ami  the  manner  in  which  the 
fund  shall  l)e  jiaid.  in  a  book  to  be  kejit  for  that  ]iur])(>se  by  the  local 
lodge,  or  if  such  member  be  absent  from  his  lodge  or  through  extra- 
ordinary causes  be  prevented  from  thus  designating  a  beneficiary 
in  said  l)ook,  that  he  may  do  so  in  writing,  transmitted  to  the  local 
lodge,  and  further  providing  that  if  any  such  designation  has  been 
made  that  the  benefit  fnnd  at  the  member's  death  shall  be  paid 
to  his  wife:  if  she  be  not  living,  to  his  childi-en.  ])i-o  rata,  and  that 
if  he  left  neither  wife  nor  cliildrcii.  and  has  made  no  valid  designa- 
tion of  beneficiaries,  then  that  no  portion  of  the  benefit  fund  shall 
be  paid  to  any  one  on  account  of  such  member:  it  was  held,  that  the 
failure  oi  a  member  to  m;dce  such  designation,  is  failui'e  to  comply 
witli  a  condition  precedent,  and  the  fact  that  thr  local  lodge  did  not 
keep  the  book  used  in  writinu'  the  names  of  the  beneficiaries  as  |)ro- 
vided  in  till'  by-laws  was  not  a  sufficient  excuse  for  failing  to  make 
surli  ili>si<^nation  of  beneficiaries. 

It  was  i'lirthrr  held,  that  in  such  case  where  a  member  dies  with- 
out ha\iim  made  such  designation.  Iea\ing  neither  wife  nor  chil- 
dri'ii.  that  his  brothers  and  sisters  caiiuot  recover  any  portion  of 
the  lii'iiefit  riiiid  on  an  oral  st;itement  niailc  by  the  member  to  the 
secretary  of  the  society  that  he  desired  tlii'  lieiieiit  to  go  to  them. 

Lowenthal   vs.   District    Grand    Lodge   No.   2,   I.   O.    B.   B.,    February, 
ISnS.   m   Ind.   All]).   277, 


THE    HTATH    OF    IXDJAXA  245 

Suickle — ' '  Self-inflicted  Injuries. ' ' 

A  heiipfil  cci'tifie'iile  (Icsiunatcil  live  iiisljiuces  I'm' wliicli  t  lici-r  sIkhiIiI 
lie  ii  pai'tit'ipatioii  in  llic  I)i'ni'li1  riiiid.  tlic  last  of  wliicli  was  thai  llie 
sum  of  one  luuidred  dollai-s  would  lie  paid  as  a  fuiioral  benefit  "if 
deatli  sluill  result  from  any  cause  a,t  any  time  while  this  meiid>er 
is  in  good  standing',"'  llici'c  was  a  further  provision  th;it  "no  heiie- 
fits  will  he  j)ai(l  for  self-intlieted  injuries." 

It  was  held  that  the  society  was  not  lialile  for  a  funeral  benefit 
upon  the  death  of  a  member  oeeurrinu'  by  suicide. 

Weblier   vs.   Home   Benevolent    Society.   .January.   ISfi;),    21    Ind.   App. 
:!45. 

Change  of  Plans — Creation  of  Classes — After  Enacted  Laws. 

As  to  the  I'ight  of  a  society  to  chanui'  its  plan.  <M'eate  diffei'ent 
classes,  raise  the  rates  ui)on  members  and  I'cadjust  same,  one  of  the 
earliest  ami  best  considered  cases  is  that  of  Knights  of  Pythias 
vs.  Knight,  where  a  change  was  made  by  the  Society  in  its  plan  of 
doing  busiiu^ss.  It  had  been  <loing'  business  solely  upon  the  post- 
mortem i)lau,  having'  tliree  classes  of  members  upon  this  |)lan.  It 
created  a  fourth  chiss  based  upon  the  ante-mortem  plan,  and  to  this 
fourth  class  the  members  of  the  other  nlaiis  at  the  >onnger  ages 
were  transferring,  upon  the  invitation  and  urging  of  the  society. 
An  action  was  brought  to  prevent  the  Society  from  enforcing  its 
amended  laws,  and  carrying-  oiit  its  ne'w  plans  on  the  ])art  of  one  of 
the  older  mcMubers  of  tlie  old  jilan.     Ou  this  point  the  Ccnu't  said: 

"We  do  iu)t  affirm  that  a  beiu^tit  society  may,  hy  a  change  in  its 
hy-laws.  arbitrarily  repudiate  an  obligation  created  hy  a  jiolicN-  of 
insurance;  but  we  do  affirm  that  wher(>  a  change  is  regularly  m.-ule  in 
its  by-laws,  and  the  motive  which  intlnences  the  change  is  an  hoin'st 
■one  to  promote  the  welfare  of  the  society,  and  the  memliers  are 
all  given  an  opportunit\'  to  avail  themselves  of  the  change,  no  ac- 
tionable wi'ong  is  done  the  mendiers  oi-  their  beneficiaries.  It  may 
isonu'times  hajjiien  that  the  interests  of  an  iiidiviiln.'d.  oi'  of  a  few  in- 
dividuals, may  be  impaired;  but  it  is  the  right,  .'ind  indeed  it  is  the 
■duty  of  the  society,  to  protect  the  interests  of  the  man.w  rather  than 
of  the  few.      rersinis  who  l)ec(nne  niemlii'i's  of  such   societies  must 


246  FRATERNAL    SOCIETY    LAW 

take  notice  of  tliis;  and  one  person  cannot,  tlierefore,  demaut^lhat 
the  welfare  of  the  society  and  the  interests  of  the  many  lie  sacri- 
ficed for  his  sole  benefit. 

"In  the  case  before  ns  tlie  change  from  the  one  plan  to  tlie  other 
■was  not  an  arbitrary  or  nnreasonable  exercise  of  power;  nor  was 
it  the  repudiation  of  a  debt,  nor  the  destruction  of  a  vested  right. 
It  was  not  nnreasonable,  because  it  may  well  be  that  the  system  of 
insurance  originally  adopted,  which  gave  no  heed  to  age,  was  so 
infirm  as  to  be  incapable  of  long-  enduring.  It  was  not  arbitrary, 
because  the  by-laws  reserved  the  right  of  amendment,  and  a  desire 
to  promote  the  welfare  of  the  society  brought  about  the  change.  It 
was  not  the  repudiation  of  a  debt,  because  the  right  to  the  avails  of 
assessments  provided  for  by  the  contract  was  not  taken  away.  It 
was  not  the  destruction  of  a  vested  right,  because  the  power  to 
amend  was,  as  reserved,  a  part  of  the  contract  from  which  the  right 
of  the  beneficiary  emanated,  and  because,  also,  the  right  to  enter 
the  new  class  was  open  to  all  members  on  equal  terms. 

"There  was  a  classification,  it  is  true,  according  to  age;  but  there 
was  no  inequality,  because,  as  all  men  know,  it  is  no  more  than  .just 
to  require  one  whose  life  exjiectancy  is  brief  to  pay  a  higher  rate 
than  one  whose  age  gave  him.  in  the  usual  coiu'se  of  nature,  a  longer 
lease  of  life. 

"It  is  to  be  constantly  kept  in  mind  that  the  contract  does  not  liind 
the  society  to  pay  a  designated  sum.  absolutely  and  at  all  events; 
but,  on  the  contrary,  the  contract,  by  its  express  terms,  limits  the 
beneficiary  to  a  specific  fund  derived  from  assessments.  The  rigiit 
of  the  beneficiary,  as  fixed  by  the  contract,  is  to  receive  the  avails  of 
the  assessments.    Bacon,  Benefit  Societies,  Para.  453. 

"There  is  no  general  fund  from  which  a  loss  can  be  paid.  All  the 
money  available  for  the  payment  of  losses  is  derived  from  the  assess- 
ment of  the  members  of  the  class  in  which  (he  loss  occurs.  It  is 
therefore  not  legally  po.ssible  for  a  beneficiary  in  one  class  to  comi>el 
payment  out  of  funds  derived  from  premiums  of  assessments  paid 
by  the  members  of  aiu)ther  class.  Each  class  contributes  to  its  own 
losses,  but  not  lo  losses  in  othei-  classes.  Of  this,  members  and  bene- 
ficiaries are  bound  to  take  iiotici':  and  thc\-   cainiot.  therefore,   de- 


THE    HTATE    OF    INDIANA  247 

iji.-md  llijit  I'liiids  lii'lonuiiii;'  tn  iiiiotlici'  cliiss  shiill  he  diverted  I'oi' 
their  benetit. 

"  BeiR'ticiarie.s  fi(U(nire  tlieir  ri^lits  lliroufih  tlie  members.  Ft  is 
possible  that  in  some  exceptional  particulars  tlu^y  may  have  rifi:lits 
wiiieh  the  members  dn  imt  possess;  but  in  a  ease  like  this,  where 
their  contract  restricts  lliem  to  a  specilic  fund,  they  certainly  have 
no  right  to  demand  payment  out  of  a  fiuid  beloupino'  to  another 
class.  Their  right  to  payment  is  eoufiiied  1o  the  fund  designated  by 
their  conti'act.  and  they  cannot,  with  justice,  demand  that  other 
funds  shall  be  appropi'iatetl  to  the  payment  of  their  claim." 

On  the  ijuestion  as  to  the  danuiges  sustained  by  a  member  of  the 
old  class,  the  Court  said  this: 

"Could  the  plaintiff  recover  moi'e  than  nominal  damages  for  the 
depletion  of  the  class  to  which  the  assured  belonged,  even  if  it  were 
conceded  that  the  change  constituted  a  breach  of  the  contract? 

"There  can  be,  it  seems  clear  to  us.  only  oni'  answei-  to  this  rpies- 
tion;  and  that. is,  the  damages  are  too  remote,  conjectural,  and 
speculative  to  form  the  basis  of  a  legal  recovery.  The  result  that 
would  have  followed  had  not  the  system  been  changed  is  a  mere 
matter  of  speculation  and  conjecture.  It  cannot  be  said  that,  if  no 
change  has  been  made,  tliere  would  have  been  no  reduction  in  the 
numbers  of  the  class. 

"If  the  system  originally  adopted  was  not  one  (and  this  the  facts 
stated  make  very  probable)  that  would  maintain  itself,  then  the 
appellee  would  have  been  nuich  worse  off  than  she  is  now.  Whether 
it  would  have  endured  can  only  he  conjectured.  The  damages  are 
both  conjectural  and  remote.  There  is  no  connection  between  the 
change  in  the  s.vstem  and  the  depletion  of  the  class  of  which  Ilussey 
was  a  member  that  can  be  legally  said  to  be  proximate  and  natural." 

Supi'eme  Lodgs  Ivnights  of  Pythias  vs.  Knight,  March  1889,  Supreme 
Court  of   Indiana,   3  L.  R.  A.   409. 

Recision  of  Contracts. 

A  recision  will  not  he  pm'mitted,  unless  the  jiarties  are  placed  in 
statu  (ino.  The  doctrine  has  its  foundation  in  natural  justice  which 
will  not  permit  one  to  retain  the  advantage  and  escape  the  burden 
of  his  contract  at  the  same  time. 


248  FRATERNAL    SOCIETY    LAW 

Modern  Woodmen   of  America  vs.   Vincent.  October.   1907,   Appellate 
Court   of   Indiana.    82   N.   E.    475. 

Mandamus  Not  Required  to  Preserve  Rights. 

Where  a  iiieinher  of  a  society  was  entitled  to  be  transferred  from 
cue  ehiss  to  another,  if  in  good  health,  and  while  in  good  health 
he  applied  for  such  transfer,  but  was  rejected  arbitrarily,  the  Court 
held  he  wa.s  not  bound  to  institute  niandanuis  proceedings  to  compel 
such  transfer  or  to  ju-eserve  his  rights  which  he  eft'eetiuilly  did  by 
paying  all  assessments  levied  upon  him. 

Supreme  Lodge  Knights  Pythias  vs.  Andrews,  March.  1906,  Appellate 
Court  of  Indiana.  77  N.  E.  361. 

Right  of  Members  to  Transfer  From  One  Class  to  Another. 

Where  a  member  entitled  to  a  traiisfei-  from  one  class  to  another, 
if  in  good  health  at  the  lime  of  his  ajiplication.  the  moti\(^s  of  a 
medical  examiner  whi<-li  induced  the  latter  tn  n;.i<M-1  tlic  applic-ation. 
were  held  immaterial. 

Supreme  Lodgs  Knights  of  Pythias  vs.  Andrews,  March.  1906.  Appel- 
late Court  of  Indiana,  77  N.  E.  361. 

The  Verdict  of  the  Jury  May  Rest  Upon  But  Little  Evidence. 

If  there  is  evidence  tending  to  support  the  verdict  of  a  .iury,  the 
Court  is  powerless  to  interfere  with  it,  although  a  contrary  tindinL; 
may  properly  have  been  based  upon  the  same  evidence. 

Sovereign  Camp  Woodmen  of  the  World  vs.  Co.\.  October,  1906,  Ap- 
pellate Court  of  Indiana.  78  N.  E.  683. 

Aften  Enacted  Laws  Binding — Incontestible  Contracts  Amended. 

.\  iiiemher  was  reipiired  by  an  agreement  with  the  society,  to 
eonl'(ii-ni  to  all  laws  in  force  at  that  time,  as  well  as  those  which 
miglit  thereal'li'i'  be  iidii|i1eil.  The  cdiisl  i  1 11 1  i(  m  of  the  society  ;it  that 
time  aiith<ii'i/,ei|  its  iiiiii'ndinenl  ami  ,-i  proxision  of  Ihe  cnnst  it  nt  ion 
pfo\ii|eil    |li:il    ;irie|-  Iwci  years  ;|    eerlitieate   iil'   nienibi'I'shi  |i  shonbl   be 


THE    STATE    OF    J.SOIASA  249 

incontestible  for  any  cause  except  fraud,  vidhitimi  or  l;i\vs  o1  rlic 
society,  or  failure  to  ])ay  assessjnents.  SiihscciniMitly  llie  is<iciety 
repealed  this  iueoiHcstible  clause  jiud  iirovidcd  in  lii-n  Ihereof  that 
in  case  a  ini'iiiln'i-  slimild  siiicid<'  his  hi'iictiriary  should  only  Im'  en- 
titled to  live  per  rent  id'  the  face  of  the  certificate  for  each  \-ear  that 
the  uieiuher  belonf;ed  to  the  society.  It  was  held  that  this  amend- 
ment did  not  iiii])air  the  member's  contract  who  had  been  such  tin- 
luoi'e  than  two  yeai's  |irior  to  the  iuloption  of  the  aniendinent  and 
who  thereafter  eomniitted  suicide.  The  C(Uirt  said  "the  insured 
contracted  with  a])i)ellant  to  confiu'ui  in  all  r(>spects  to  the  constitu- 
tion, la^^•s.  I'uies.  nuil  reuidations  of  this  order  now  in  force,  or 
wliich  may  be  hereafter  adopted  by  the  Supreme  Court  thereof." 
This  feature  of  the  e(Hitract  appeared  both  in  his  application  and 
the  certificate.  .\  niendier  of  an  order  of  this  character  has  a  voice 
in  its  hnxniakiny-  body  in  that  the  representatives  of  such  body 
are  selectetl  from  the  suboi-dinate  bodies  and  are  members  thereof. 
It  is  averred  in  the  answer  that  the  ameiulment  under  consideration 
was  enacted  in  due  and  regular  form,  and  we  are  to  decide  whether, 
under  insiu'ed's  eiin1i-act.  su(di  ainenduu'Ut  is  binding;-  on  bis  bene- 
ficiary. The  rifiht  to  amend  the  laws  in  nnitual  benefit  as.soeiations. 
within  reasonable  limits  is  recognized  by  all  auth(n-ities.  aiul  this  is 
true  not  (udy  of  liy-laws,  but  the  organic  law  as  well. 

To  justify  the  interference  by  the  courts  and  warrant  the  over- 
throw of  by-laws  enacted  in  the  mode  prescribed  by  the  by-laws, 
it  unist  be  shown  that  there  was  an  abuse  of  power,  or  that  the 
later  by  law  is  unreasonable.  It  is  not  enough  to  show  that  a  better 
or  wiser  course  might  lune  been  pursued,  for  it  must  be  shown  tluit 
there  was  an  abuse  of  discretion,  or  that  a  by-law  is  so  unreas(Hiable 
as  to  be  void.  We  do  iu)t  affirm  that  a  Beiu^fit  Society  nuty.  by  a 
change  in  its  by-laAvs,  arbitrarily  repudiate  an  obligation  created  by 
a  policy  of  insurance,  but  we  do  affii'm  that,  where  a  change  is  regu- 
larly made  in  its  by-laws,  and  the  nu)tive  which  iiitlueuces  the  change 
is  an  honest  one  to  iiromote  the  welfare  of  the  society,  and  the  uu^m- 
bers  are  all  given  an  opport\uiit\'  to  avail  themselves  of  the  change, 
no  actionable  wrong  is  done  the  members  or  their  beiu^ticiaries.  '  It 
may  sometimes  liajipeii  that  the  interests  of  one  individual,  oi'  of  a 
few  individuals,  nuiy  bi'  impaired,  but  this  is  the  r'iuht,  and,  indeed. 


250  FRATERXAL    SOCIETY    LA^V 

it  is  the  duty,  of  the  society  to  protect  the  interests  of  tlie  many 
rather  than  of  a  few.  Persons  who  become  members  of  such  society 
nuist  take  notice  of  this,  and  one  nerson  cannot,  therefore,  demand 
that  the  welfare  of  the  society  and  tlie  interests  of  the  many  be 
sacrificed  for  liis  sob*  Itenefit.'' 

Court  of  Honor  vs.  Hutchens,  Nov..  190C,  Appellate  Court  of  Indiana. 
79  N.  E.  409. 

Error  in  Age — Voidable  Contracts. 

A  member  in  his  application  warranted  that  he  was  born  on  a 
certain  date  and  ag;ree(l  that  any  untrue  answer  shoidd  forftMt  his 
certificate.  He  was  in  fact  a  year  older  than  the  age  named  in  his 
application,  but  the  rate  charged  the  member  who  had  misstated 
his  age  was  the  same  as  it  wimld  have  been  had  he  acctu'atel\-  stated 
his  age.  It  was  held,  under  the  circumstances,  that  a  breach  of  war- 
ranty rendered  the  contract  voidable  only,  and  that  the  society  hav- 
ing taken  no  steps  to  enforce  a  forfeiture,  was  held  to  consider  it 
valid  and  was  not  entitled  after  the  death  of  the  member  in  an  action 
on  the  contract  to  recover  thereon,  to  claim  that  the  contract  was 
void  from  the  beginning. 

Modern     Woodmen     of     America   vs.   Vincent.   Feb.,   1907.    Appellate 
Court  of  Indiana,  80  N.  E.  427. 

Coroner's  Inquest  Not  Binding  on  Beneficiary. 

The  laws  of  a  society  required  the  beneticiary  to  furnish  proofs 
of  death  and  after  the  coroner's  inquest  was  held,  to  siUjmit  a  copy 
of  the  evidence  and  findings,  as  a  part  of  the  proof  of  death.  A 
beneficiary  attached  to  the  proofs  a  copy  of  the  evidence  taken  by 
the  coroner  together  with  his  finding,  which  was  to  the  effect  that 
the  member  came  to  his  death  by  drinking  carbolic  acid  with  sui- 
cidal intent.  The  beneficiary  stated  that  she  did  not  believe  that 
the  member  came  In  his  death  by  drinking  cai'hdlic  acid.  It  was 
held  that  the  coroner's  fiiulings  and  the  testimony  taken  by  him. 
were  not  admissible  in  eviilenee  under  the  general  denial;  if  ad- 
mLssible  at. all  they  were  only  so  in  siijiport  of  an  answer  setting  up 


THE    STATIC    OF    ISDI.iyA  '251 

(Icalli  \)\  siiic^idc.     The  Court  licld  1l:at  the  t'oroner's  iii(|ucs1  was  in- 
adniissililc.  to  establisli  an  at'iii'iiial  i\-i'  dcfciiso  of  suioidc. 

Craiger  vs.  Modern  Woodmen  of  America.  Feb.,  1907,  Appellate  Court 
of  Indiana,  80  N.  E.  429. 

Release — Suit  to  Cancel  Must  Tender  Back  Payment  Received. 

A  I'oniplaiiit  prayiiiii  tor  a  caiici'llat  ion  of  a  reli'asf  alleged  to 
have  been  obtained  through  fraud,  wliich  fails  to  allege  a  return 
or  tender  of  the  sum  reeeivetl,  is  held  fatally  bad. 

Supreme  Council  Knights  and   Ladies  ol'  Columbia  vs.  Apman,  March, 
1907,  Appellate  Court  of  Indiana.  80  N.  E.  (!40. 

Release  of  Claim — Suit  to  Set  Aside. 

In  a  complaint  against  a  fraternal  soeiety,  issuance  of  a  certificate 
was  alleged,  and  that  the  society  by  fraud  induced  the  beneficiary 
to  execute  a  release  on  receiving  part  of  the  amoiuit  due  under  tin- 
certificate.  The  complaint  was  held  bad  and  the  evidence  introduced 
was  held  insufficient  to  establish  the  fraiul. 

Supreme  Council  Knights  and  Ladies  of  Columbia  vs.  Apman,  March, 
1907,  Appellate  Court  of  Indiana,  80  N.  E.  640. 

The  Supreme  Court  of  Indiana  on  Oct.  29,  1907,  handed  down  an 
opinion  (not  yet  printed),  in  the  case  of  Mutual  Protective  Legion 
vs.  Biegler,  State  Auditor,  which  is  of  great  interest  and  value  to 
many  fraternal  societies  and  the  opinion  is  here  reproduced  in  fidl : 

"This  was  a  proceeding  by  way  of  mandate  to  compel  the  Auditor 
of  State  to  license  relator  to  do  business  in  this  State  as  a  fraternal 
beneficiary  association,  for  the  year  then  next  ensuing.  Issues 
were  .joined,  and,  after  a  hearing,  the  peremptory  writ  was  denied. 

"It  appears  from  the  evidence  that  the  relator  is  chartered  as  a 
fraternal  beneficiary  association  under  the  laws  of  Illinois,  and 
■  that  it  was  doing  business  in  this  State  at  the  time  of  the  enact- 
ment of  the  act  of  March  1,  1899,  Acts  1899,  p.  177,  Sees.  5050a,  et 
seq.  Burns  1901.  The  testimony  of  the  president  of  relator  showed 
that  it  had   established   what   it   termed   an   emergency  council   in 


252  FRATERNAL    HOVIETY    LAW 

the  State  of  Illinois:  that  this  council  had  about  three  hiiiuli-ed 
members,  a  majority  of  whom  were  members  who  had  moved  away 
from  their  home  councils;  that  relator  emjiloyed  agents,  or.  as 
they  were  termed,  deputies,  some  of  whom  were  paid  a  salary  and 
others  a  commission,  to  establish  new  councils:  that  where  a  de|)iity 
had  gotten  a  number  of  persons  together,  and  some  of  them  failed 
to  be  initiated,  while  others  desired  to,  and  there  was  reason  to 
believe  that  at  some  time  a  council  might  be  organized  at  that 
place,  that  association  regarded  it  for  the  good  of  the  order  to 
receive  the  latter,  and  to  enroll  them  in  some  established  couiu^il, 
either  one  nearby,  or  in  the  emergency  council  referred  to:  that 
iu  that  event  the  deputy  would  give  the  applicant  the  unwi-itten 
\vork,  including  the  signs,  passwords,  etc.  When  asked  whether 
this  would  be  done  in  a  cornfield  m'  barn,  the  witness  answered: 
"Any  place  that  was  secret.'  So  far  as  indicated  by  its  by-laws. 
it  would  seem  that  the  beneficial,  or  perhaps  it  might  be  termed 
the  insui-ance  feature,  to  relator's  organization  is  the  leading  one. 
The  witness  referred  to  testified  that  a  dejiuty  who  was  working 
on  a  salary  was  exi)ected  to  do  a  certain  am<nnit  of  business  or 
his  services  would  be  discontinued. 

"By  §  5050a,  .supra,  it  is  required  that  fratei'iuil  beneficiary  as- 
sociations 'shall  have  a  lodge  .system,  with  ritualistic  fi)rni  of 
woi'k.'  'Such  associations.'  the  section  declares,  'shall  be  governed 
by  this  act,  and  shall  be  exempt  from  the  jn'ovisions  of  the  in- 
surance laws  of  the  State.'  Section  5050b,  authorizes  associa- 
tions incorpoi-ated  in  another  State,  falling  within  the  description 
set  forth  iu  the  prior  section  which  were  doing  business  in  the 
State  at  the  time  of  the  enactment  of  tiie  statute,  to  continue  such 
business,  provided  that  they  comjily  with  the  provisions  of  the  act 
concerning  the  making  of  annual  repoi-ts  to  llu'  .Vuditor  of  State 
and  designate  him  as  a  person  njioii  whom  ])rocess  )n;iy  be  served. 
By  SS  5(150(1  and  505()f.  which  apply  to  associations  of  the  char- 
acter of  relaliii-.  provisiiiii  is  iii:idi'  Tor  tlir  lirrnsing  of  such  asso- 
ciations til  do  hnsiness  in  the  State  from  year  to  year.  Section 
5()5(lk.  which  follows  section  making  prox'isiou  for  the  iiu-or)iorat ion 
of  IVatri-nal  licm-ficiai'v  associations  in  the  State  provides:  "Such 
associations  shall   not   employ   paid   aiic^nts  in  solieitinu;   or  pi'denring" 


THE    STATI'J    OF    IXDIANA  253 

nieinbci's  ('xccpl  in  1hc  (ii-L;iiiii/.;i1  ion  or  linililiiiL;  up  nl'  siilHii'iliii:it  c 
bodies  or  jii'antiiij;'  iiu'iiihcrs  iiidiu'cmciils  to  |)i'ociire  new  meiiiiiei's. ' 
It  appears  from  tlie  evidence  ott'ei'ed  hy  i-elator  tliat  there  is  a  liUe 
provision   in  the  act  nndcr  which   rehdor   is  iiicdfporated. 

"It  is  ((uite  (dear  to  ns  thai  I'clator  lias  been  j;uii1y  ol'  a  vinhiliim 
(if  both  tile  letter  and  the  spirit  ot  !;  oil.")!);!,  supra,  ^\ilich  re- 
quiri's  that  snch  associations  shall  have  a  lodge  sysleni.  with  ritual- 
istic form  (d'  wiirk.  It  is  unnecessary  for  the  purpnse  (d'  this 
case  to  attemjit  a  differentiation  of  ordinai'y  insurance  and  the 
benefits  grantetl  by  fraternal  organizations.  It  suffices  now  to  state 
that  it  was  evidently  the  legislative  contemplation  that  the  spirit 
of  fraternity  among  the  mend)ers  of  such  associations  afforded  such 
a  check  in  the  administration  of  their  beneficiary  funds  as  to  war- 
rant the  establishment  of  such  associations  without  surrounding 
them  with  all  of  the  safeguards  which  have  been  thrown  about  the 
business  of  insurance,  in  which  the  jiarties  deal  at  arm's  length. 
In  otiier  words,  that  i)rovision  of  the  statute  concerning  the  main- 
tenance of  the  lodge  system  with  ritualistic  form  of  work  is.  a  con- 
dition of  the  grant  of  ])o-\\er,  and  is  one  which  such  an  association 
is  not  at  libertv  to  disobey.  Upon  this  point  we  are  of  opniion 
that  the  provision  of  the  statute  should  be  rigidly  adhered  to,  for 
in  matter  of  substance  it  is  the  fraternal  feature  of  these  asso- 
ciations which  constitutes  one  of  the  leading  distinctions  between 
them  and  mutual  insurance  companies.  The  course  piu'sued  by 
relator  would  in  some  degree  tend  to  break  clown  an  intended  legis- 
lative check  upon  the  safeguarding  of  its  funds,  ami  if  winked 
at,  would  afford  a  constant  temptation  to  associations  of  like  char- 
acter to  hont)r  the  statute  in  the  breacdi  rather-  than  in  its  observ- 
ance. 

"It  also  ai)pcars  to  us  that  in  another  jiarticular,  relator  is  calling 
on  the  C'Ourt  to  admit  it  to  do  business  in  contravention  of  the 
donu'stic  policy  of  this  State,  and  also,  if  we  may  regard  the  evi- 
dence oft'ered  by  its  coiuisel,  in  contravention  of  its  own  charter 
restrictions.  We  refer  to  the  employment  of  agents  who,  as  stated 
above,  are  permitted  to  enroll  members  who  have  no  substantial 
relation  to  the  association  as  a  fraternity.  Whether  associations 
of  this  character,  which   are   organized  luider  the  law  of  another 


254  FRATERNAL    SOCIETY    LAW 

State,  but  which  were  doing:  business  her.e  when  the  statute  was 
passed,  are  to  be  regarded  as  foreign  corporations,  or,  by  virtue 
of  the  statute,  as  domestic  corporations  quod  hoc,  yet  the  legishitive 
comity  whicli  the  statute  expresses  in  authorizing-  them  to  do  busi- 
ness in  this  State  is  not  without  restriction,  and  should  be  limited 
by  con.struction,  so  that  an  association  may  not  by  the  taking  up 
of  a  local  habitation,  pursue  a  course  which  would  at  once  be  to 
do  what  is  prohibited  to  local  associations  of  like  character  and 
to  violate  the  law  of  its  own  existence.  In  discussing  the  doctrine  of 
comity,  as  appjied  to  foreign  corporations  Judge  Thompson  says: 
'Without  attempting  to  enumerate  in  a  single  section  all  the  cases 
to  which  this  county  does  not  extend,  it  may  be  observed  in  the 
first  place  that  it  does  not  extend  so  far  as  to  concede  to  foreign 
corporations  the  powers  which  their  own  charters  do  not  permit 
them  to  exercise,  nor  so  far  as  to  ])eniiit  a  foreign  corporation 
to  exercise  powers  within  the  State  which  a  domestic  corporation 
of  the  same  kind  is  not  permitted  to  exercise  under  the  consti- 
tution, laws  or  jjolicy  oF  liie  State.'  If)  Cyc.  1224,  and  see  Nathan 
vs.  Lee,  152  Ind.  232. 

"The  course  pursued  by  relator  is  especially  pernicious  in  its 
tendency,  since  the  partial  abandonment  of  the  lodge  feature  and 
the  employment  of  paid  agents  are  brought  into  conjunction,  tlius 
putting  agents  unuder  the  temptation  to  solicit  individuals  nominally 
to  join  the  association  on  account  of  the  death  benefits  paid  by  it, 
instead  of  devoting  their  efforts  to  the  building  up  of  a  s.ystem 
of  lodges. 

"Counsel  for  appellant  contend  that  as  relator  had  made  its  re- 
port according  to  law,  it  was  the  duty  of  the  Auditor  of  State  to 
issue  a  license:  that  he  had  no  power  to  enter  into  an  incpiii'y 
as  1(1  the  iiiiuuiei-  in  whieli  rcbitor  had  done  business.  This  appears 
to  us  to  lir  ;i  moot  c|iii',s1  ion,  in  view  of  the  fact  that  relator  is 
seeking  by  inaiidatc  to  cnl'oi'cc  the  granting  of  a  license.  The  writ 
will  not  issue  to  pi'nniolc  a  wrong,  or  to  coin]iel  a  coinpliani'c  with 
the  strict  h'ttci-  of  the  slMtntc  in  disregard  of  its  spirit.  Western 
I'nion  Tel.  Co.  vs.  State,  ex  rel.,  IGf)  Ind.  492:  Funk  vs.  State,  ex  rel.. 
Kit)  Ind.  4.'ir);  People,  ex  rel.  vs.  Board.  1:57  N.  V.  2(11.  As  was 
said    i?i    tile    rase    last    cited:      'Tliat    I'l-lalor    nnist    come    into    Court 


THE    STATE    OF    JXDIANA  255 

with  clcjin   liiiiids.'      When    rchitiir   li;is  pureed   JlscH'  ol'  tliat    wliidi 
is   objertioiuihlc    in    its   iu;iiiiicr   of   doiiio-   linsiiicss    i1    will    lir    linn' 
enough  to  seek  the  aid  of  the  courts. 
"  Jutlgjneiit  ;dfirmed. "" 

A  cei'titicate  under  which  a  jx'rsou  was  insuri'd  made  suicide 
while  sane  a  complete  defense  apainst  Hie  contract  of  insurance. 
The  constitut  inn  and  liy-laws  pi'oviili'cl  1li;M  ai'tcr  Iwn  vi'ars  the  cer- 
tificate should  be  incontestable  except  for  fraud,  violation  of  the 
constitution  or  laws,  or  failure  to  pay  assessments.  After  the  mem- 
ber had  paid  his  assessments  for  five  years  a  by-law  was  adopted 
which  provided  that  if  a  member  committed  suicide,  only  part)  of 
the  face  of  the  certificate  would  be  paid.  It  was  held  that  the  by- 
law, having  been  passed  after  the  defense  of  siiicide  had  become 
un;ivail;d)lf.  was  void  as  to  tbat  ccrtificalc.  sinc<'  it  impaired  the 
obligation  of  the  contract.    The  Court  said  : 

"No  question  as  to  the  authority  of  the  society  to  make  or  change 
its  by-laws  , generally  speaking,  is  involved  in  this  case,  but  by  the 
terms  of  the  contract  the  appellant  has  become  absolutely  liable  for 
the  payment  of  two  thousand  dollars,  and  could  not  thereafter  dis- 
charge such  liability  to  the  extent  of  $1,500  b.v  the  enactment  of  a 
by-law,  any  more  than  it  could  discharge  its  entire  liability  by  such 
an  act,  it  admitting  liability  to  the  amount  of  $500." 

Court  of  Honor  v.s.  Hutehens.  App.  Ct.  of  IiuL.  Nov.  1907,  82  N.  E.  89. 


256  FHATEIfXAL    SOCIETY    LA.^V 


THE 

STATE  OF  IOWA. 

CHAPTER  16. 

(The  Section  mimbers  are  from  the  Iowa  Code.) 

Defined. 

Section  1822.  A  fraternal  beneficiary  as.sociation  is  herelty  de- 
clared to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit,  and  having  a  lodge  system, 
with  ritualistic  form  of  work  and  representative  form  of  govern- 
ment. Such  association  .shall  make  provision  for  tlie  payment  of 
benefits  in  case  of  deatli.  and  may  malvc  provision  for  the  payment 
of  benefits  in  case  of  sickness,  temporary  or  permanent  physical  dis- 
ability, either  as  a  resnlt  of  disease,  accident  or  old  age,  provided 
the  period  of  life  at  which  payment  of  physical  disability  benefits 
on  account  of  old  age  commences  .shall  not  be  under  seventy  years, 
suljject  to  the  compliance  by  members  with  its  constitution  and  laws. 
But  the  provisions  of  this  chapter  shall  not  be  construed  to  include 
fraternal  orders  which  only  provide  for  sick  and  funeral  benefits. 

Assessments. 

Section  1823.  The  fund  from  which  the  payment  of  such  benefits 
shall  })e  made  and  the  expenses  of  such  association  defrayed  shall  be 
drrivcd  from  beneficiary  calls,  assessments  or  dues  collected  from  its 

liirliibci'S. 


THE    STATE    OF    IOWA  257 

Insurable  Age — Beneficiary. 

Section  18'24.  No  fraternal  association  created  or  organized  under 
the  provisions  of  this  chapter  shall  issue  any  certificate  of  member- 
ship to  any  person  under  the  age  of  fifteen  years,  nor  over  the  age 
of  sixty-five  years,  nor  luiless  the  beneficiary  under  said  certificate 
shall  be  the  husband,  wife,  relative,  legal  representative,  heir  or 
legatee  of  such  member. 

Statutes  Applicable. 

Section  1825.  Sucli  associations  shall  he  governed  by  this  chapter, 
and  shall  be  exempt  from  the  provisions  of  the  statutes  of  this  State 
relating  to  life  insurance  companies,  except  as  hereinafter  provided. 

Copy  of  Application. 

Section  1826.  All  such  associations  shall,  upon  the  issue  or  re- 
newal of  any  beneficiary  certificate,  attach  to  such  certificate  or  in- 
dorse thereon  a  true  copy  of  any  application  or  representation  of  the 
member  which  by  the  terms  of  such  certificate  are  made  a  part 
thereof.  The  omission  so  to  do  shall  not  render  the  certificate  in- 
valid, but  if  any  such  association  neglects  to  comply  with  the  re- 
quirements of  this  section  it  shall  not  plead  or  prove  the  falsity  of 
any  such  certificate  or  representation  or  any  part  thereof  in  any 
action  upon  such  certificate,  and  the  plaintiff  in  any  such  action,  in 
order  to  recover  against  such  association,  shall  not  be  required  to 
either  plead  or  prove  such  application  or  representation. 

Where  Suable. 

Section  1827.  Such  associations  may  be  sued  in  any  county  in 
which  is  kept  their  principal  place  of  business,  or  in  which  the  benefi- 
ciary contract  was  made,  or  in  which  the  death  of  the  member 
occurred :  but  actions  to  recover  old  age,  sick  or  accident  benefits 
may,  at  the  option  of  the  beneficiary,  be  brought  in  the  county  of 
his  residence. 

n 


258  FRATERNAL   SOCIETY   LAW 

Exemption  of  Proceeds. 

Section  1828.  The  proceeds  of  any  beneficiary  certificate  issued 
by  any  such  association,  and  of  any  claims  for  benefits,  shall  be  ex- 
empt from  execution  and  attachment,  to  the  same  extent  as  the  pro- 
ceeds of  any  policy  of  life  or  endowment  insurance,  as  is  now  or 
may  hereafter  be  provided  by  the  laws  of  this  State. 

Foreign  Companies. 

Section  1829.  Any  such  association  organized  under  the  laws  of 
any  other  State  shall  be  permitted  to  do  business  in  this  State,  when 
it  shall  have  filed  with  the  auditor  of  this  State  a  duly  certified  copy 
of  its  charter  and  articles  of  association,  and  a  copy  of  its  constitu- 
tion or  laws,  certified  to  by  its  secretary  or  corresponding  officer, 
together  with  an  appointment  of  the  auditor  of  this  State  as  a  per- 
son upon  whom  ]n-ocess  may  be  served  as  hereinafter  provided,  if 
such  association  shall  be  shown  to  be  authorized  to  do  business  in 
the  State  in  which  it  is  incorporated  or  organized.  The  auditor  of 
State  may  personally,  or  by  some  person  to  be  designated  by  him, 
examine  into  the  conditions,  affairs,  character  and  business  methods, 
accounts,  books  and  investments  of  such  association  at  its  home 
office,  Avhich  examination  shall  be  at  the  expense  of  such  association, 
and  shall  be  made  within  thirty  days  after  demand  therefor;  and 
the  expense  of  such  examination  shall  be  limited  to  five  dollars  per 
day  and  the  necessary  expenses  of  travel  and  for  hotel  bills.  If  the 
auditor,  after  such  examination,  is  of  the  opinion  that  no  permit 
should  be  granted  to  such  association,  he  may  refuse  to  issue  the 
same. 

Report. 

Section  1830.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make,  and  file 
with  the  auditor  of  State,  a  report  for  the  year  ending  on  the  thirty- 
fir.st  day  of  December  immediately  preceding.  All  reports  shall  be 
upon  blank  forms  to  be  provided  by  the  auditor  of  State,  or  may  be 
printed  in  pamphlet  form,  and  shall  be  verified  under  oath  Ity  the 
authorized  officers  of  such  association,  and  slmll  ho  published,  or  the 


THE    STATE    OF    IOWA  '259 

substance  thereof,  in  the  annual  report  of  the  auditor  of  State  under 
the  separate  title  "Fraternal  Beneficiary  Associations,"  and  shall 
contain  answers  to  the  followino-  questions: 

1.  Xmiilirr   of  certificates  issued   diirinii'   the  year,   or   iiieiubers 
admitted ; 

2.  Amount  of  iudenuiity  efteeled  thereby  ; 

3.  Number  of  losses  or  benefit  liabilities  iiicuri'cd  : 

4.  Nuinl)er  of  losses  or  benefit  liabilities  paid; 

5.  The  amount  received  from  each  assessment  for  the  year; 

6.  Total  amount  paid  members,  l)eneficiaries,  legal  representa- 
tives or  heirs; 

7.  Number  and  kind  of  claims  for  wliich  assossniiMils  have  been 
made; 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and 
brief  statement  of  reason ; 

9.  Does  association  charge  annual  or  other  ])eriodical  dues  or 
admission  fees; 

lU.  How  much  ou  eacb  one  thousand  doHai's  annually,  or  per 
capita,  as  the  case  may  be ; 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof ; 

ll!.  Total  amount  of  salaries,  fees,  per  diem,  mileage,  expenses 
])aid  to  officers,  showing  amount  paid  to  each; 

13.  Does  the  association  guarantee,  in  its  cei-tificates.  fixed 
amounts  to  be  paid  regardless  of  amount  realized  from  assessments, 
dues,  admission  fees  and  donations ; 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  such 
guarantee ; 

15.  Has  the  association  a  reserve  or  emergenc.y  fund ; 

IG.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested ; 

17.  Has  the  association  more  than  one  class; 

18.  If  so,  how  many,  and  amount  of  indemnity  in  each; 

19.  Number  of  members  iu  each  class ; 

20.  If  voluntary,  so  state,  and  give  date  of  organization; 

21.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time,  giving  chapter  and  ycai-  and  date  of  passage  of 
the  act; 


260  FRATERNAL    SOCIETY   LAW 

22.  If  organized  under  the  laws  of  any  other  State,  territory  or 
province,  state  such  fact  and  the  date  of  organization,  giving  chap- 
ter and  year  and  date  of  passage  of  the  act; 

23.  Number  of  certificates  of  beneficiary  membership  lapsed 
during  the  year; 

2-1.  Number  in  force  at  beginning  and  end  of  year ;  if  more  than 
one  class,  number  in  each  class; 

25.  Names  and  addresses  of  its  presidents,  secretary  and  treas- 
urer, or  corresponding  officers. 

The  auditor  of  State  is  empowered  to  make  any  additional  in- 
quiries of  anj-  such  association  relative  to  the  business  contemplated 
bj'  this  act,  and  such  officer  of  such  association  as  the  auditor  of 
State  may  require,  shall  promptly  reply  in  writing,  under  oath,  to  all 
such  inquiries. 

Service  of  Process. 

Section  1831.  Any  such  association  permitted  to  do  business 
within  this  State,  and  not  having  its  principal  office  within  this 
State,  and  not  organized  under  tlie  laws  of  this  State,  shall  appoint, 
in  writing,  the  auditor  of  State  to  be  attorney  in  fact,  on  whom  all 
process  in  any  action  or  proceeding  against  it  shall  be  served,  and 
in  such  writing  shall  agree  that  any  process  against  it  which  is 
served  on  said  attorney  in  fact  shall  be  of  the  same  validity  as  if 
served  upon  the  association,  and  that  the  authority  shall  continue 
in  force  so  long  as  any  liability  remains  outstanding  in  this  State. 
Copies  of  such  certificate,  certified  by  said  auditor  of  State,  shall  be 
deemed  sufficient  evidence  thereof,  and  shall  be  admitted  in  evidence 
with  the  same  force  and  effect  as  the  original.  Service  upon  such 
attorney  shall  be  deemed  sufficient  service  upon  such  association. 
When  legal  ])i'()ccss  against  any  such  association  is  served  upon  said 
auditor  of  Stale,  he  shall  immediately  notify  the  association  of  such 
service  by  letter,  postage  prepaid,  directed  and  mailed  to  its  secre- 
tary or  corresponding  officer,  and  shall  within  two  days  after  such 
service  forward  in  the  same  manner  a  copy  of  the  process  served  on 
him  to  such  officer.  The  auditor  of  State  shall  keep  a  record  of  all 
processes  served  upon  him,  which  record  shall  show  the  day  and 
liovu'  when  such  service  was  made.  \ 


THE    STATE    OF    IOWA  261 

Section  1832.  "Before  any  beneficiary  society,  order  or  associa- 
tion shall  be  authorized  to  conimpnce  business  within  this  State,  it 
shall  submit  to  the  auditor  of  State  its  by-laws  or  rules  by  which  it 
is  to  be  governed,  and  also  its  articles  of  incorporation  which  shall 
include  ils  pliin  of  business.  The  audilni'  nf  State  shall  thereupon 
submit  its  articles  of  incorporation  to  the  attorney-general  for  ex- 
amination, and  if  found  by  him  to  he  in  harmony  with  this  title, 
chapter  and  with  law,  he  shall  so  certify  upon  said  articles  and 
return  them  to  the  auditor  of  State.  If  the  auditor  of  State  shall 
approve  the  articles  and  also  the  by-laws  or  rules,  he  shall  issue  to 
the  society,  order  or  association  a  permit  in  writing,  authorizing  it 
to  transact  business  within  this  State  for  a  period  of  one  year  from 
the  first  day  of  April  of  the  year  of  its  issue,  for  which  certificate 
and  all  proceedings  in  connection  therewith,  there  shall  be  paid  to 
the  auditor  of  State  a  fee  of  twenty -five  dollars,  and  for  each  annual 
renewal  thereof  a  like  fee  shall  be  paid:  provided,  however,  that 
before  such  certificate  shall  be  issued,  the  fraternal  society,  order  or 
association  shall  have  actual  bona  fide  applications  upon  the  lives  of 
at  least  five  hundred  (500)  persons,  residents  of  this  State,  for  at 
least  one  thousand  dollars  of  insurance  each,  and  the  auditor  of 
State  may  require  the  presentation  of  such  applications,  signed  by 
the  applicants  themselves.  No  renewal  of  certificate  of  authority 
shall  bo  made  to  any  society,  order,  or  association  whose  member- 
shi]!.  in  good  standing,  or  the  amount  of  whose  insurance  in  force 
shall  be  reduced  below  the  above  requirements.  Societies,  orders  or 
associations  not  organized  under  the  laws  of  this  State,  in  addition 
to  the  requirements  of  the  provisions  of  section  eighteen  hundred 
twenty-nine  (1829)  of  the  code,  must  also  comply  with  all  of  the 
provisions  of  this  chapter,  except  as  to  the  residence  of  membership ; 
provided,  that  no  such  society,  order  or  association  shall  be  author- 
ized to  transact  business  within  this  State  unless  it  shall  be  shown 
to  have  actual  members,  in  good  standing  of  at  least  one  thousand, 
and  at  least  one  million  dollars  of  insurance  in  force." 

Agents. 

Section  1833.  Such  association  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organization  or  build- 


262 


FRATERNAL    SOCIETY   LAW 


ing  up  of  subordinate  bodies,  or  granting  members  inducements  to 
procure  new  members. 

Changing  Beneficiary.  v 

Section  1834.  No  contract  between  a  member  and  his  beneficiary 
that  the  beneficiary  or  any  person  for  him  shall  pay  such  mem- 
ber's assessments  and  dues,  or  either  of  them,  shall  deprive  the 
member  of  the  right  to  change  the  name  of  the  beneficiary. 

Meetings  in  Other  States. 

Section  1835.  Any  such  association  organized  under  the  laws  of 
this  State  may  provide  for  the  meetings  of  its  legislative  or  govern- 
ing body  in  any  other  State,  territory  or  province  wherin  such  asso- 
ciation shall  have  subordinate  bodies,  and  all  business  transacted  at 
such  meetings  shall  be  valid,  in  all  respects,  as  if  such  meetings  were 
held  within  this  State;  and  where  the  laws  of  any  such  association 
provide  for  the  election  of  its  officers  by  votes  to  be  cast  in  its  sub- 
ordinate bodies,  the  votes  so  cast  in  its  subordinate  bodies  in  any 
other  State,  territory  or  province  shall  be  valid,  as  if  east  witKin  this 
State. 

Proceedings  for  Violations  of  Statute. 

Section  1836.  Any  such  association  refusing  or  neglecting  to 
make  the  report  as  provided  in  this  chapter  shall  be  excluded  from 
doing  business  within  this  State.  The  auditor  of  State  must,  within 
sixty  days  after  failure  to  make  siich  report,  or  in  case  any  such 
association  sliall  exceed  its  powers,  or  shall  conduct  its  business 
fraudulent ly.  or  shall  fail  to  comply  Avith  any  of  the  provisions  of 
this  chapter,  give  notice  in  writing  to  the  attorney-general,  who 
shall  immediately  commence  an  action  against  such  association  to 
enjoin  the  same  from  carrying  on  any  business.  No  association  so 
en.jiiini'd  shall  have  authority  to  continue  business  until  such  report 
shall  be  made,  or  overt  act  or  violation  complained  of  shall  have 
been  corrected,  nor  until  the  costs  of  such  action  lie  paid  by  it.  pro- 
vided the  court  shall    lind   that  such   association  was   in   default  as 


THE    STATE    OF    IOWA  263 

charged ;  whereupon  the  auditor  of  State  shall  reinstate  such  associa- 
tion, and  not  until  then  shall  such  association  be  allowed  to  again 
do  business  in  this  State.  Any  officer,  agent  or  person  acting  for 
any  such  association  or  subordinate  body  thereof  within  this  State, 
while  such  association  shall  be  so  enjoined  or  prohibited  from  doing 
business  pursuant  to  this  chapter,  shall  be  deemed  guilty  of  a  mis- 
demeanor, and  on  conviction  thereof,  shall  be  punished  by  a  fine  of 
not  less  than  twenty-iive  dollars,  nor  more  thn  two  hundred  dollars, 
or  by  imprisonment  in  the  county  jail  not  less  than  thirty  days  nor 
more  than  one  year,  or  by  both  such  fine  and  imprisonment,  in  the 
discretion  of  the  court. 

Illegal  Business — Agents. 

Section  1837.  An.y  person  who  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise  for  any  such  association  which  has  failed, 
neglected  or  refused  to  comply  with  or  which  has  violated  any  of 
the  provisions  of  this  chapter,  or  shall  have  failed  or  neglected  to 
procure  from  the  auditor  of  State  proper  certificate  of  authority 
to  transact  business  as  provided  for  by  this  chapter,  shall  be  subject 
to  the  penalty  provided  in  the  last  preceding  section  for  the  mis- 
demeanor therein  specified. 

False  Representations  by  Officers  or  Agents. 

Section  1838.  Any  officer,  agent  or  member  of  such  association, 
who  shall  obtain  any  money  or  property  belonging  thereto  by  any 
false  or  fraudulent  representations,  shall  be  fined  not  more  than 
five  hundred  dollars  and  costs,  and  stand  committed  until  such  fine 
and  costs  are  paid,  or  may  be  imprisoned  in  the  county  jail  not  more 
than  six  months. 

Physician 's  Certificate. 

Section  1839.  Every  applicant  for  membership  in  any  association 
organized  in  this  State  shall  first  be  examined  by  a  physician  hold- 
ing a  certificate  from  the  State  board  of  medical  examiners. 

The  legislature  provided  for  the  examination  of  Fraternal  Soci- 
eties by  act  approved  March  17,  1904,  which  act  is  as  follows : 


2g4  FRATERNAL   SOCIETY   LAW 

An  Act  to  provide  for  the  examination  of  Fraternal  Beneficiary 
Associations.  [Amendatory  to  chapter  nine  (9)  of  title  nine 
(IX)  of  the  code,  relating  to  Fraternal  Beneficiary  Societies, 
Orders  and  Associations.] 

Be  it  enacted  by  the  General  Assembly  of  the  State  of  Iowa : 

"Association"  Defined. 

Section  1.  The  term  "association"  when  i;sed  in  this  act  shall 
mean  any  society,  order  or  association  organized  or  authorized 
under  the  provisions  of  chapter  nine  of  title  nine  of  the  code. 

Examination — Assistants — Compensation. 

Section  2.  The  auditor  of  State  may.  at  any  time  he  may  deem  it 
advisable,  either  in  person  or  by  his  legally  appointed  representa- 
tive, make  an  examination  of  or  inquire  into  the  affairs  of  any  fra- 
ternal beneficiary  association  authorized  or  seeking  to  be  authorized 
to  transact  business  within  this  State,  provided  the  examination  of 
associations  organized  under  the  laws  of  this  State  shall  not  be  less 
frequent  than  once  during  each  biennial  period.  To  aid  in  making 
such  examination,  the  auditor  of  State  may  appoint  such  assistants 
as  may  be  necessary,  each  of  whom  shall  receive  as  compensation 
for  his  services  not  to  exceed  five  dollars  per  day. 

Officers  to  Assist — Examiner  May  Administer  Oaths. 

Section  3.  When  an  association  is  being  examined,  the  ofScers, 
agents  or  employes  thereof  shall  produce  for  inspection  all  books, 
papers,  documents  or  other  information  concerning  the  affairs  of  the 
association  and  shall  otherwise  assist  in  the  examination.  The  audi- 
tor of  State  or  examiner  shall  have  authority  to  administer  oaths, 
and  may  summon  and  may  examine  under  oath  any  officer,  employe, 
representative  or  agent  of  any  association  concerning  its  affairs  or 
condition. 

Revocation  or  Suspension  of  Authority. 

Section  4.     If  upon  investigation  or  cxainiiiation,  it  shall  appear 


THE    STATE    OF    IOWA  265 

to  the  satisfaction  of  the  auditor  of  State  that  any  association  is 
doing  an  illegal  or  unauthorized  business,  or  is  failing  to  fulfill  its 
contracts  with  its  members,  or  is  conducting  its  business  fraudu- 
lently, or  if  its  membership  or  the  amount  of  its  insurance  in  force 
has  been  reduced  below  the  legal  requirement,  or  should  any  asso- 
ciation decline  or  refuse  to  submit  to  an  examination,  the  auditor 
of  State  may  suspend  or  revoke  its  certificate  of  authority  to  trans- 
act business  within  this  State,  and  haying  revoked  the  certificate  of 
authority  of  any  association  organized  under  the  laws  of  this  State, 
he  shall  at  once  report  the  same  to  the  attorney-general  who  shall 
apply  to  the  district  court  or  any  judge  thereof  for  the  appointment 
of  a  receiver  to  wind  up  the  affairs  of  such  association. 

Expenses — How  Paid. 

Section  5.  In  addition  to  the  compensation  of  the  assistants  pro- 
vided for  in  section  two  of  this  act,  the  auditor  or  examiner  and 
assistants  shall  be  entitled  to  actual  and  necessary  traveling,  hotel 
and  other  expenses  while  conducting  examinations  away  from  their 
respective  places  of  residence,  the  same  to  be  paid  by  the  treasurer 
of  State  upon  warrants  drawn  by  the  auditor  of  State,  bills  there- 
for having  been  filed  under  oath  and  approved  by  the  executive 
council.  Such  expense  and  compensation  shall,  by  the  auditor  of 
State,  be  charged  to  and  collected  from  the  associations  examined 
and  should  any  association  neglect  or  refuse  to  pay  the  same,  the 
auditor  of  State  shall  at  once  revoke  its  certificate  of  authority  to 
transact  business  within  this  State. 

Soliciting  New  Business — Penalty. 

Section  6.  Any  officer,  manager,  agent  or  representative  of  any 
association  who  with  knowledge  that  its  certificates  [certificate]  of 
authority  has  been  suspended  or  revoked  or  that  it  is  doing  an 
illegal,  unauthorized  or  fraudulent  business,  solicits  insurance  for 
said  association  or  receives  applications  therefor,  or  does  any  other 
act  or  thing  toward  receiving  or  procuring  any  new  business  for 
said  association,  shall  be  deemed  guilty  of  a  misdemeanor  and  for 
every  such  act,  on  conviction  thereof,  shall  pay  a  fine  of  not  less 


266  FRATERNAL   SOCIETY   LAW 

than  one  hundred  nor  more  than  one  thousand  dollars,  or  be  im- 
prisoned in  the  county  jail  not  more  than  one  year,  or  be  punished 
by  both  such  fine  and  imprisonment. 

By  act  approved  March  30,  1904,  the  legislature  passed  a  law  pro- 
viding for  the  consolidation  of  Fraternal  Societies.  The  act  is  as 
follows : 

An  Act  to  provide  for  consolidation  or  re-insurance  of  the  risks  of 
Fraternal  Beneficiary  Societies  with  or  by  other  societies  or  organ- 
izations, and  providing  a  plan  therefor.  [Additional  to  chapter 
nine  (9)  of  title  nine  (IX)  of  the  code,  relating  to  Fraternal 
Beneficiary  Societies,  Orders  and  Associations.] 

Be  it  enacted  by  the  General  Assembly  of  the  State  of  Iowa : 

Plan  of  Consolidation  or  Re-insurance — Approval. 

Section  1.  When  any  fraternal  beneficiary  association  shall  pro- 
pose to  consolidate  or  enter  into  anj^  re-insurance  contract  with  any 
Other  association  or  organization,  it  shall  present  its  proposed  plan 
of  consolidation  or  re-insurance,  together  with  a  statement  of  the 
condition  of  its  aii'airs  to  the  auditor  of  State  for  his  approval. 
Should  he  approve  the  plan,  the  same  shall  be  submitted  by  any 
association  proposing  to  re-insure  its  risks  or  transfer  its  business, 
to  its  local  lodges  or  organizations  or  to  a  regular  or  special  meeting 
of  its  supreme  lodge  or  governing  body  to  be  voted  upon,  such  notice 
being  given  as  the  auditor  of  State  may  direct.  If,  in  the  judgment 
of  the  auditor  of  State,  it  is  deemed  advisable  he  may  also  require 
the  plan  to  be  in  like  manner  submitted  to  the  association  proposing 
to  accept  or  re-insure  the  risks  of  any  other  association.  In  ease  two 
or  more  associations  propose  to  consolidate,  the  proposed  plan  of 
consolidation  shall  be  submitted,  as  above  provided,  to  all  the  asso- 
ciations interested  in  such  consolidation.  In  any  of  the  above  cases, 
a  two-thirds  vote  of  all  of  the  members  of  each  association  present 
and  voting  shall  be  necessary  to  an  approval  of  any  plan  of  consoli- 
dation or  re-insnranee,  and  in  no  ease  shall  proxies  be  voted.  On 
presenting  to  the  auditor  of  State  satisfactory  proof  that  the  fore- 
going provisions  have  been  complied  witli  and  that  the  required 
number  of  votes  have  been  east  in  favor  of  the  proposed  plan,  he 


THE    STATE    OF    IOWA  267 

shall  issue  to  the  associations  an  order  to  the  cft'cct  that  the  plan 
has  been  approved,  and  the  same  shall  be  in  force  and  effect  from 
and  after  the  date  of  such  order,  and  the  auditor  of  State  shall 
direct  such  distribution  of  the  assets  of  aii.>'  such  association  or  asso- 
ciations as  shall  be  just  and  equitable. 

Expenses,  How  Paid. 

Section  2.  All  expenses  or  costs  incident  to  proceedings  under  the 
provisions  of  this  act  shall  be  paid  by  the  associations  interested. 

Penalty. 

Section  3.  Any  officer,  director  or  manager  of  any  association 
violating  or  consenting  to  the  violation  of  any  of  the  provisions  of 
this  act  shall  be  punished  by  a  fine  of  not  less  than  one  thousand 
dollars,  or  by  imiJi'isoument  in  the  county  jail  not  less  than  one 
year,  or  by  both  such  fine  and  imprisonment  in  the  discretion  of  the 
court. 

The  following  section  of  the  code  is  here  reproduced  in  view  of 
the  decisions  of  the  courts  referred  to  immediately  following: 

Against  Insurance  Companies. 

Section  3499.  Insurance  companies  may  be  sued  in  any  county 
in  which  their  principal  place  of  biisiness  is  kept,  or  in  which  the 
contract  of  insurance  was  made,  or  in  which  the  loss  insured  against 
occurred,  or.  in  case  of  insurance  against  death  or  disability,  in  the 
county  of  the  domicile  of  the  insured  at  the  time  the  loss  occurred, 
or  in  the  county  of  plaintiff's  residence. 

Under  tliis  section  an  action  may  be  brought  before  a  justice  of 
the  peace  against  an  insurance  company  in  another  county  than  that 
of  its  residence,  notwithstanding  the  provisions  of  section  4476.  with 
reference  to  the  place  of  bringing  action  in  justice's  courts: 

Hunt  vs.  Farmers   Ins.  Co.,  67-742. 

Suit  may  be  brought  in  the  county  where  the  loss  occurs : 

State  Ins.  Co.  vs.  Granger,  62-272. 


268  FRATERNAL   SOCIETY   LAW 

A  provisiou  iu  a  certificate  of  mutual  benefit  insurance  by  which 
it  is  stipulated  that  action  shall  not  be  brought  thereon  except  in  a 
certain  county  named  is  not  valid : 

Matt  vs.  Iowa  Mut.  Aid  Association,  81-135. 

An  action  may  be  brought  against  an  insurance  company  in  any 
eountj'  in  which  the  loss  occurred  although  it  has  no  agent  on  whom 
service  can  be  made,  provided  jurisdiction  in  rem  is  acquired  by 
publication : 

Lesure  Lumber  Co.  vs.  Mutual  F.  Ins.  Co.,  70  N.  W.,  761. 

An  action  against  an  insurance  company  may  be  brought  in  the 
county  in  which  the  loss  occurred,  even  though  the  principal  place 
of  business  of  a  company  is  in  another  county  of  the  State: 

Parder  vs.  National  Masonic  Ace.  Ass'n,  63  N.  W.,  601. 

j\Iutual  benefit  associations  are  to  be  deemed  insurance  companies 
within  the  provisions  of  this  section : 

Ibid. 

The  legislature  by  an  act  approved  April  10,  1907,  exempted  the 
funds  of  Fraternal  Societies  from  taxation.     The  act  is  as  follows: 

An  Act  to  amend  section  thirteen  hundred  and  four  (1304)  of  the 
code,  so  as  to  exempt  from  taxation  the  accumulations  and  funds 
of  Fraternal  Beneficiary  Associations. 

Be  it  enacted  by  the  General  Assembly  of  the  State  of  Iowa: 

Exemptions. 

Section  1.  That  section  thirteen  hundred  and  four  (1304)  of  the 
code  be  amended  by  adding  the  following: 

"8.  The  accumulations  and  funds  held  or  possessed  by  fraternal 
beneficiary  associations  for  the  purposes  of  paying  the  benefits  con- 


THE    STATE    OF    IOWA  269 

templated  by  section  ciyhlccii  liumlrcd  ami  twenty-two  (1822)  of  the 
code,  or  for  tlie  payment  of  the  expenses  of  such  association." 

By  act  approved  Feb.  9,  1907,  the  legislature  amended  Section 
1794  of  the  ct)de  so  as  to  have  said  section  apply  to  fraternal  Acci- 
dent Societies.     Said  Section  1794  as  so  amended,  is  as  follows: 

Foreign  Companies. 

Sectioir  1794.  Any  association  organized  under  the  laws  of  any 
other  State  to  carry  on  the  business  of  insuring  the  lives  of  persons, 
or  of  fui'nishing  benefits  to  the  widows,  orphans,  heirs  or  legatees 
of  deceased  members,  or  of  pa\ing  accident  indenuiity,  or  surrender 
value  of  certificates  of  insurance,  upon  the  stipulated  premiuni  plan 
or  assessment  jilau,  nuiy  be  permitted  to  do  business  in  the  State  by 
com]ilying  with  the  recpiirements  hereinafter  made,  but  not  other- 
wise. It  shall  file  with  the  auditor  of  State  a  copy  of  its  charter  or 
articles  of  incorporation,  duly  certified  by  the  proper  ofSeers  of  the 
State  wherein  it  was  orgauized,  together  with  a  copy  of  its  by-laws, 
application  and  policy  or  certificate  of  membership.  It  shall  also 
file  with  the  auditor  a  statement,  signed  and  verified  by  its  president 
and  secretary,  which  shall  show  the  name  and  location  of  the  asso- 
ciation, its  principal  place  of  business,  the  names  of  its  president, 
secretary  and  other  princii)al  officers,  the  number  of  certificates  or 
policies  in  force,  the  aggregate  amount  insured  thereby,  the  amount 
paid  to  beneficiaries  in  the  event  of  death  or  accident,  the  amount 
paid  on  the  last  death  loss  and  the  date  thereof,  the  amount  of  cash 
or  other  assets  owned  by  the  association  and  how  invested,  and  any 
other  information  which  the  auditor  may  require.  The  statement, 
papers  and  proofs  thus  filed  shall  show  that  the  death  loss  or  sur- 
render value  of  the  certificate  of  insurance  or  accident  indemnity 
is  in  the  main  provided  for  by  assessments  upon  or  contributions  by 
surviving  members  of  such  association,  and  that  it  is  legally  organ- 
ized, honestly  managed,  and  that  an  ordinary  assessment  upon  its 
members  or  other  reyuhir  contributions  to  its  mortuary  fund  are 
sufficient  to  pay  its  niaxinnuu  certificate  to  the  full  limit  named 
therein.  Upon  its  comjilying  with  the  provisions  of  this  section,  and 
of  section  eighteen  luuulred  and  eight,  chapter  eight,  of  this  title, 
atul  the  payment  of  twenty-five  dollars.  tlu>  auditor  shall  issue  to  it 


270  FRATERNAL    mCIETY   LAW 

a  certificate  of  authority  to  do  business  in  this  State,  provided  the 
same  right  is  extended  by  the  State  in  which  said  association  is 
organized  to  associations  of  the  same  class  in  this  State.  When  the 
auditor  doubts  the  solvency  of  any  foreign  association,  and  the  fail- 
ure to  pay  the  full  limit  named  in  its  certificate  or  policy  shall  be 
such  evidence  of  its  insolvency  as  to  require  the  auditor  to  investi- 
gate it,  he  shall  for  this  or  other  good  cause,  at  the  expense  of  such 
association,  cause  an  examination  of  its  books,  papers  and  business 
to  be  made,  and  if  upon  such  examination  he  finds  that  the  associa- 
tion is  not  financially  sound,  or  is  not  paying  its  policies  or  certifi- 
cates in  full,  or  is  conducting  its  business  fraudulently,  or  if  it  shall 
fail  to  make  the  statement  required  by  law.  he  may  revoke  its 
authority  and  prohibit  it  from  doing  business  until  it  shall  again 
comply  with  the  provisions  of  this  chapter.  If  the  auditor  appoints 
someone  not  receiving  a  regular  salary  in  his  office  to  make  this 
examination,  such  examiner  shall  receive  five  dollars  per  day  for  his 
services  in  addition  to  his  actual  traveling  and  hotel  expenses,  to  be 
paid  by  the  association  examined,  or  by  the  State  on  the  approval 
of  the  executive  council,  if  the  association  fails  to  pay  the  same. 

The  provisions  of  this  section  shall  apply  to  fraternal  beneficiary 
associations  doing  exclusively  an  accident  insurance  business,  and 
upon  compliance  with  the  provisions  of  this  chapter,  and  the  pro- 
visions of  chapter  eight  of  title  nine  of  the  code,  so  far  as  the  same 
are  applicable,  such  associations  may  be  authorized  to  transact  busi- 
ness within  this  State. 

The  legislature  by  acts  approved  March  15.  1907.  April  4.  1907, 
and  February  14,  1907,  enacted  three  importnnt  laws,  which  are  set 
out  as  follows: 

An  Act  relating  to  rates  of  Fraternal  Beneficiary  Societies. 

Be  it  enacted  by  the  General  Assembly  of  the  State  of  Iowa : 
Section  1.  No  fraternal  beneficiary  society  not  admitted  to  trans- 
act business  within  this  State  prior  to  the  passage  of  this  act,  shall 
be  incorporated  or  given  a  permit  or  certificate  of  authority  to 
transact  business  within  lliis  Stnte.  unless  it  shall  first  show  that 
the   mortuary   assessment  rates  ])rovi(l('d   for  in  whatever  plan   of 


THE    STATE    OF    IOWA 


271 


business  it  has  adopted,  are  not  lower  than  is  indicated  as  necessary 
b.y  the  followinti'  mortality  table: 


NATIONAL  PRATERMAL  CONGRESS 

MORTALITY  TABLE. 

Age. 

No. 
Living. 

No. 
Dying. 

Probability 
of  Dying. 

Age. 

No. 
Living. 

No. 
Dying. 

Probability 
of  Dying. 

20.. 

100,000 

500 

.0050000 

60.  . 

69,801 

1,588 

.0227504 

21.. 

99,500 

501 

.0050352 

61.. 

68,213 

1,681 

.0246434 

22.. 

98,999 

502 

.0050708 

62.. 

66,532 

1,778 

.0267240 

23.. 

98,497 

503 

.0051068 

63.. 

64,754 

1,880 

.0290330 

24.. 

97,994 

505 

.0051535 

64.. 

62,874 

1,985 

.0315701 

25.. 

97,489 

507 

.0052006 

65.. 

60,889 

2,094 

.0343904 

26.. 

96,982 

510 

.0052587 

66.. 

58,795 

2,206 

.0375202 

27.. 

96,472 

513 

.0053176 

67.. 

56,589 

2,308 

.0409620 

28.. 

95,957 

517 

.0053877 

68.. 

54,271 

2,430 

.0447753 

29.. 

95,442 

522 

.0054693 

69.. 

51,841 

2,539 

.0489767 

30.. 

94,920 

527 

.0055520 

70.. 

49,302 

2,645 

.0536489 

31.. 

94,393 

533 

.0056466 

71.. 

46,657 

2,744 

.0588122 

32.. 

93,860 

540 

.0057532 

72.. 

43,913 

2,832 

.0644912 

33.. 

93,320 

548 

.0058723 

73.. 

41,081 

2,909 

.0708113 

34.. 

92,772 

557 

.0060040 

74.. 

38,172 

2,969 

.0777795 

35.. 

92,215 

567 

.0061487 

75.. 

35,203 

3,009 

.0854957 

36.. 

91,648 

578 

.0063067 

76.. 

32,194 

3,026 

.0939927 

37.. 

91,070 

591 

.0064895 

77.. 

29.168 

3,016 

.1031010 

38.. 

90,479 

606 

.0066977 

78.. 

26,152 

2,977 

.1138345 

39.. 

89,873 

622 

.0069209 

79.. 

23,175 

2,905 

.1253506 

40.. 

89,251 

640 

.0071708 

80.. 

20,270 

2,799 

.1380858 

41.. 

88,611 

660 

.0074483 

81.. 

17,471 

2,659 

.1521951 

42.. 

87,951 

683 

.0077657 

82.. 

14,812 

2,485 

.1677694 

43.. 

87,268 

708 

.0081129 

83.. 

12,327 

2,280 

.1849599 

44.. 

86,568 

734 

.0084797 

84.. 

10,047 

2,050 

.2040410 

45.. 

85,826 

761 

.0088668 

85.. 

7,997 

1,800 

.2250844 

46.. 

85,065 

790 

.0092870 

86.. 

6,197 

1,539 

.2483460 

47.. 

84,275 

822 

.0097538 

87.. 

4,658 

1,277 

.2741520 

48.. 

83,453 

857 

.0102693 

88.. 

3,381 

1,023 

.3025732 

49.. 

82,596 

894 

.0108238 

89.. 

2,358 

788 

.3341815 

50.. 

81,702 

935 

.0114440 

90.. 

1.570 

579 

.3687898 

51.. 

80,767 

981 

.0121460 

91.. 

991 

404 

.4076690 

272  FRATERNAL    SOCIETY   LAW 


Age. 

52.. 

No. 

Living. 

79,786 

No. 
Dying. 

1,029 

Probability 
of  Dying. 

.0128970 

Age. 
92.. 

No. 
Living, 

587 

No. 
Dying. 

264 

Probability 
o(  Dying. 

.4497445 

53.. 

78,757 

1.083 

.0137512 

93.. 

323 

161 

.4984520 

54.. 

77.674 

1,140 

,0146767 

94.. 

162 

89 

.5493827 

55. . 

76,534 

1,202 

.0157054 

95.. 

73 

44 

.6027397 

56.. 

75,332 

1,270 

.0168587 

96.. 

29 

19 

.6551724 

57. . 

74,062 

1,342 

.0181200 

97.. 

10 

7 

.7000000 

58.. 

72,720 

1,418 

.0194994 

98.. 

3 

3 

1.0000000 

59.. 

71.302 

1,501 

.0210513 

Section  2.     This  act,  being  deemed  of  immediate  impoi'tance,  shall 
take  elfect  and  be  in  force  from  and  after  its  publication  in  the  Reg- 
•  ister  and  Leader,  and  Des  Moines  Daily  Capital,  newspapers  pub- 
lished at  the  city  of  Des  Moines,  Iowa. 
Approved  March  15.  1907. 

An  Act  to  permit  Fraternal  Beneficiary  Societies,  Orders  or  Associa- 
tions to  piurchase  and  own  real  estate ;  to  erect  a  building  thereon 
and  to  occupy  and  rent  the  same. 

Be  it  enacted  by  the  General  Assembly  of  the  State  of  Iowa : 

Section  1,  Any  fraternal  beneficiary  society,  order  or  association 
organized  under  the  laws  of  this  State,  accumulating  money  to  be 
held  in  trust  for  the  purpose  of  the  fulfillment  of  its  certificates  or 
contracts,  shall  be  permitted  to  invest  not  to  exceed  ten  (10)  per 
cent,  of  the  aggregate  amount  of  such  aecumiilation  in  such  real 
estate  in  this  State  as  is  necessary  for  its  accommodation  as  a  home 
office,  and  in  the  purchase  or  erection  of  any  building  for  such  p\ir- 
pose  it  may  add  thereto  rooms  for  rent;  provided  that  before  any 
association  shall  invest  any  of  its  funds  in  accordance  with  the  pro- 
visions of  this  sub-division  it  shall  first  obtain  the  consent  of  the 
executive  council.  Any  company  or  association  so  investing  its 
funds  shall  convey  the  real  estate  thus  acquired  to  the  auditor  of 
State  by  deed,  such  property  to  be  held  by  him  in  trust  for  the  bene- 
fit of  the  members  of  such  association,  the  vahie  thereof  to  be  deter- 
mined from  time  to  time  by  the  auditor  of  State.  Provided,  that 
nothing  in  this  act  shall  be  construed  to  permit  the  officials  or  lioard 
of  directors  of  such  society,  ordej-  or  association  to  make  such  in- 


THE    STATE    OF    IOWA  273 

vestment  without  authority  specifically  griintcd  hy  tho  said  society, 
order  or  association  through  its  grand  nr  su|)reme  lodge  or  coiiven- 
tion. 

Approved  April  4,  1!)()7. 

An  Act  to  provide  for  the  investment  of  the  funds  of  Fraternal 
Beneficiary  Societies,  Orders  or  Associations. 

lit'  it  enacted  b.y  the  General  Assoiiilily  of  the  State  of  Iowa: 

Section  1.  Any  fraternal  beneficiary  society,  order  or  association 
organized  under  the  laws  of  this  State,  accumulating  money  to  be 
held  in  trust  for  the  purpose  of  the  fulfillment  of  its  certificates  or 
contracts  shall  invest  such  accumulations  in  tlie  following  securities 
and  no  other. 

1.  Bonds  of  the  United  States. 

2.  Bonds  of  this  or  of  any  other  State,  when  such  bonds  are  at  or 
above  par. 

3.  Bonds  or  other  evidences  of  indebtedness  of  any  county,  city, 
town  or  school  district  within  the  State  or  any  other  State,  or  drain- 
age bonds  of  anj^  drainage  district  in  the  State  of  Iowa  where  such 
bonds  or  other  evidences  of  indebtedness  are  issued  by  authority  of 
and  according  to  law  and  bearing  interest,  and  are  approved  by  the 
executive  council. 

4.  Bonds,  mortgages  and  other  interest  bearing  securities  being 
first  liens  upon  real  estate  within  this  State  or  any  other  State, 
worth  at  least  doi;ble  the  amount  loaned  thereon  and  secured 
thereby  exclusive  of  improvements,  or  two  and  one-half  times  such 
amount  including  the  improvements  thereon,  if  such  improve- 
ments are  constructed  of  brick  or  stone ;  but  no  such  improvements 
shall  be  considered  in  estimating  the  value  unless  the  owner  shall 
contract  to  keep  the  same  insured  in  some  reliable  fire  insurance 
company  or  conipanii's  authorized  to  do  business  in  the  State,  during 
the  life  of  the  loan,  in  a  sum  at  least  double  the  excess  of  the  loan 
above  .one-half  the  value  of  the  ground  exclusive  of  the  improve- 
ments, the  insurance  to  be  made  payable  in  case  of  loss  to  the  com- 
pany or  association  investing  its  funds,  as  its  interest  may  appear 
at  the  time  of  loss. 

18 


274  FRATERNAL   SOCIETY   LAW 

All  such  securities  shall  be  deposited  with  the  auditor  of  State 
subject  to  his  approval,  and  shall  remain  with  him  until  withdrawn 
in  accordance  with  the  provisions  of  this  act.  Any  fraternal  benefi- 
ciary society,  order  or  association  receiving  payments  or  partial  pay- 
ments on  any  securities  deposited  with  the  auditor  of  State,  shall 
notify  him  of  such  fact  giving  the  amount  and  date  of  payment 
within  fifteen  (15)  days  after  such  payment  shall  have  been  made. 
The  ofiicers  of  any  society,  order  or  association  which  fails  to  report 
the  receipt  of  payments  or  partial  payments  as  above  provided  shall 
be  liable  to  a  fine  in  double  the  amount  collected  and  not  reported 
within  the  time  and  in  the  manner  above  specified. 

An}'  societ}',  order  or  association  required  to  make  a  deposit  with 
the  auditor  of  State  as  herein  contemplated,  shall  at  the  time  of 
making  such  deposit,  designate  by  what  provisions  of  its  articles 
of  incorporation  or  laws  such  f\md  is  accumulated  and  upon  making 
request  for  withdrawal  of  any  funds  shall  designate  for  what  i)ur- 
pose  such  withdrawal  is  desired. 

Anj'  society,  order  or  association,  may  at  any  time  change  its 
securities  on  deposit  by  depositing  a  like  amount  in  other  securities 
of  the  same  character  and  the  auditor  of  State  shall  permit  a  with- 
drawal of  the  same  upon  satisfactory  proof  in  writing  filed  with 
him  that  they  are  to  be  used  for  the  purpose  for  which  they  were 
originally  deposited. 

The  auditor  of  State  shall  have  authority  to  suspend  or  revoke 
the  certificate  of  authority  of  any  society,  order  or  association  fail- 
ing to  comply  with  an\'  of  the  provisions  of  this  act  or  for  violating 
the  same. 

"Nothing  in  this  act  shall  be  constructed  to  apply  to  any  associa- 
tion organized  solely  for  benevolent  purposes  and  composed  wliolly 
of  members  of  any  one  occupation,  guild,  profession  or  religious 
denomination." 

Approved  February  14,  1907. 

Beneficiary — Niece  by  Affinity. 

The  Supreme  Court  in  passing  u|h)ii  section  1824  of  the  code, 
which  provides  that  "No  fraternal  association  shall  issiu'  any  cer- 
tificate of  mcnibei'sliip  unless  the  beneficiary  uiuler  said  certificate 


THE    STATE    OF   IOWA  275 

shall  be  the  husband,  wife,  relative,  legal  representative,  heir,  or 
legatee  of  such  member."  Held,  in  a  case  where  the  niece  of  the  first 
wife  of  the  father  of  the  deceased  member  claimed  the  fund,  the 
deceased  member  being  the  issue  of  the  second  wife,  that  the  said 
niece  was  not  competent  to  take  the  benefit.  The  court  said,  "con- 
ceding that  the  term  relative  is  to  lie  extended  to  cover  the  rela- 
tives by  marriage  as  well  as  by  blood,  we  are  unable  to  reach  the 
conclusion  that  the  plaintiff  was  a  relative  of  the  deceased  during 
the  life  of  the  first  wife.  The  father  of  deceased  was  the  uncle 
by  marriage  to  the  plaintiff,  and  it  appears  after  the  death  of  the 
first  wife  the  father  of  decea.sed  wan  still  her  uncle  by  afSnity,  but 
there  was  no  relationship  by  either  blood  or  affinity  between  the 
plaintiff  and  the  deceased  son  of  her  uncle  by  marriage  to  his  second 
wife.  The  general  proposition  seems  to  be  this,  that  the  relation- 
ship of  affinity  is  not  created  by  the  blood  relatives  on  either  side 
of  the  parties  to  the  marriage  relation. 

Smith  vs.  Supreme  Tent,  Knights  of  the  Maccabees  of  the  World, 
March,  1905,  127  la.  115. 

Payment  to  Wrong  Beneficiary — Suit  by  Other  Claimant. 

Where  a  fraternal  society  paid,  pending  an  action  by  one  of  two 
contesting  claimants,  the  amount  of  a  death  loss  to  one  of  the 
claimants  in  the  regular  way,  but  neglected  to  inform  its  counsel 
of  the  fact  until  after  judgment  against  it  on  a  claim  of  the  other 
claimant,  it  could  not  urge  that  such  payment  constituted  newly 
discovered  evidence  entitling  it  to  a  new  trial. 

Robins  vs.  The  Modern  Woodmen  of  America,  May,  1905,  127  la.  444. 

Construction  of  Doubtful  Contracts. 

It  is  only  when  the  nature  of  an  insurance  contract  is  ambiguous 
or  fairly  suspectible  of  two  or  more  constructions  that  courts  are 
required  to  give  it  that  construction  which  will  afford  protection  to 
the  assured. 

The  court  in  this  case  said:  "Rut  appellee  insists  that  the  lan- 
guage used  in  the  certificate  should  be  so  constructed  as  to  cover 


276  FRATERNAL    SOCIETY   LAW 

the  injury  above  desci'ibed,  relying  upon  the  proposition  that  it  is 
the  duty  of  the  court  to  construe  the  terms  of  every  policy  of  insur- 
ance or  benefit  certificate  most  strongly  against  the  insurer  and  to 
resolve  every  doubt  of  ambiguity  in  favor  of  the  insured.  There  is 
no  doubt  about  the  rule  for  which  the  counsel  contends,  but  the 
difficulty  is  in  its  application.  If  the  language  used  in  the  certificate 
is  ambiguous  or  is  reasonably  capable  of  two  or  more  constructions 
that  construction  should  be  given  which  will  aft'ord  the  insurer  pro- 
tection under  the  certificate,  but  the  parties  have  a  right  to  make 
contracts  for  themselves  and  there  is  no  authority  for  the  court  to 
change  such  contracts."  To  take  away  from  parties  this  unde- 
niable right  of  contract,  or  to  make  contracts  for  parties  is  not 
within  the  province  of  courts  of  justice. 

Peterson  vs.  Modern  Brotherhoofl  of  America.  November.   1904,  125 
la,  562. 

Inefifectual  Change  of  Beneficiary. 

Where  a  benefit  certificate  entitles  the  lieiieficiary  to  participate 
in  a  special  fund,  a  subsequent  change  in  beneficiaries  made  by  the 
society  upon  compliance  of  the  member  with  cei'tain  requirements 
being  authorized,  an  attempted  change  of  beneficiary  was  held  not 
to  effect  the  right  of  the  beneficiaiy  where  the  member  failed  to 
perform  the  conditions  required  to  make  such  change. 

Kennedy  vs.  Iowa  Legion  of  Honor,  April,  1904,  124  la.  66. 

Separate  Warranties — Separate  Breaches  of. 

AVhere  there  are  separate  warranties  in  a  benefit  certificate  a 
breach  of  either  will  defeat  recovei-y  and  the  jnrv  should  be  clearly 
instructed  to  that  effect  by  the  court.  It  was  held  error  for  the 
court  to  fail  or  refuse  to  .so    instruct. 

Knapp  vs.  Brotherhood  of  American  Yeoman.  October,  1905.  12.S  la. 
566. 

Funds  In  Hand  To  Be  Applied  Before  Forfeiture. 

Where  a  jiiiitiial   Hi'c   iiisiiraiice  cojiipaiiy  had   funds  in  its  liands 


THE    STATE    OF    IOWA  277 

belongiug  to  the  incmlicr  sufficient  to  pay  an  assessment  due  from 
him  it  was  held  that  it  could  not  declare  a  forfeiture  of  the  policy 
for  non-payment  of  such  assessment,  but  that  it  was  its  duty  to 
apply  the  funds  in  its  hands. 

Younghoe  vs.   The   Grain   Shippers'    Mutual    Fire     Insurance    Com- 
pany, January,  1905,  126  la.  o74. 

Strict  Construfction  Required. 

The  conditions  of  an  insurance  contract  which,  if  violated,  ren- 
ders the  same  void,  will  be  strictly  construed  and  in  case  of  doubt, 
will  be  construed  against  the  company. 

Swank  vs.  Farmers  Insurance  Company,  February,  1905,  126  la.  547. 

Application  of  Advance  Payments. 

The  advance  mortuary  assessment  joaid  by  a  member  of  a  fra- 
ternal society  to  join  the  society  cannot  be  applied  on  an  assessment 
levied  prior  to  his  membership,  under  regulations  which  require 
new  members  to  pay  an  advance  assessment  and  which  also  provide 
that  death  losses  shall  be  paid  from  equal  contributions  of  the  mem- 
bers. 


Hetzel  vs.  Knights  and  Ladies  of  the  Golden  Precept,  February,  1906, 
129  la.  655. 


Advance  Payments. 

A  rule  that  each  menil)er  of  a  fraternal  society  shall  pay  an 
advance  assessment  upon  entering-  the  societ.v  does  not  require  him 
to  keep  an  advanced  assessment  continually  up. 

Hetzel  vs.  Knights  and  Ladies  of  the  Golden  Precept,  February,  1906, 
129  la.  655. 

Exemption  From  General  Insurance  Law^s. 

A  fraternal  societ.y  was  held  not  to  be  a  life  insurance  company 


278  FRATERNAL    SOCIETY   LAW 

within  the  meaning  of  the  statutes,  imposing  obligations  and  re- 
quirements upon  regular  insurance  companies. 

Knapp  vs.  Brotherhood  of  American  Yeoman,  Octoher,  1905,  128  la. 
566. 

Premature  Suit. 

An  action  against  a  fraternal  society  for  benefits  which  are  not 
due  according  to  the  terms  of  its  contract,  is  premature,  and  a  denial 
of  liability  by  the  society  will  not  operate  to  mature  the  cause  of 
action. 

Arrison  vs.  The  Supreme  Council  of  Mystic  Toilers,  January,  1906, 
129  la.  303. 

Forfeiture — Health  Certificate — Advance  Payments. 

Where  a  member  of  a  fraternal  society  had  paid  the  assessments 
before  they  became  due  and  was  in  good  standing,  the  society 
cannot  rightfully  demand  a  health  certificate  as  a  condition  of  rein- 
statement, and  if  one  is  furnished  under  such  circumstances  the 
society  cannot  rel.y  on  any  false  statements  contained  therein  for  the 
purpose  of  defeating  an  action  to  compel  an  assessment  to  pay  a 
loss  under  the  certificate.  It  was  held  in  this  case  that  under  the 
testimony  the  statements  in  the  health  certificate  were  immaterial. 

Arrison  vs.  The  Supreme  Council  of  Mystic  Toilers,  January,  1906, 
129  la.  303. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

Where  a  fraternal  society  denies  liability  on  its  certificate  on  the 
ground  of  forfeiture,  its  requirements  for  proof  of  loss  was  held  to 
have  been  waived. 

Arrison  vs.  The  Supreme  Council  of  Mystic  Toilers,  January,  1906, 
129  la.  303. 


THE    STATE    OF    IOWA  279 

Change  of  Beneficiary. 

Where  a  fraternal  society  is  estopped  to  deny  the  validity  of  an 
application  for  change  of  beneficiary,  the  beneficiary  named  in  the 
original  certificate  which  is  sought  to  be  changed  cannot  raise  ob- 
jection to  the  change  made. 

Wandell  vs.  The  Mystic  Toilers,  May,  1906,  130  la.  639. 

Societies  Not  to  Employ  Paid  Agents — Ultra  Vires  Contracts. 

A  fraternal  society  was  organized  under  the  laws  of  Iowa,  one 
provision  of  which  provided  that,  "Such  association  shall  not  em- 
ploy paid  agents  in  soliciting  and  securing  members  except  in  the 
organization  of  or  building  up  of  subordinate  bodies  or  granting 
members  inducements  to  secure  new  members."  The  society  in 
question  made  an  agreement  that  it  would  pay  for,  at  the  rate  of 
one  dollar  and  a  half  for  each  thousand  dollars  of  insurance  written 
for  it  in  Marshalltown  and  vicinity.  And  further  provided  that  an 
applicant  should  pass  medical  examination,  etc. 

The  court  in  passing  upon  the  right  of  the  society  to  make  such 
an  agreement  said,  the  term  "organization"  as  here  used  refers  to 
subordinate  bodies  and  not  to  that  of  the  association  itself,  and  the 
evidence  shows  conclusively  that  whatever  Sears  did  was  in  the 
procuring  of  members  for  the  organization  of  the  association ;  ap- 
pellee suggested  that  Sears  was  a  member  and,  therefore,  the  com- 
pensation proposed  was  merely  an  inducement  to  a  member  to  pro- 
cure others.  This  is  disposed  of  by  the  fact  that  there  were  no 
members  at  the  time  the  proposition  was  made,  and  the  work  done. 
He  undertook  to  do  something  which  the  statute  prohibited  the 
association  from  employing  him  to  do,  and  for  this  reason  the  con- 
tract to  compensate  him  was  ultra  vires,  and  therefore,  not  subject 
to  ratification.  Where  a  plea  of  estoppel  was  interposed,  on  the 
theory  that  as  an  agreement  with  the  citizens  of  Marshalltown  to 
take  insurance  was  delivered  to  the  association,  and  by  it  retained, 
and  certificates  of  membership  issued  to  those  named  therein,  the 
society  ought  not  while  obtaining  the  benefits  be  permitted  to  re- 
pudiate the  contract  by  virtue  of  which  those  benefits  were  obtained. 
"The  vice   of  this  reasoning  is  that   it   ignores  the   fact  that   the 


280  FRATERNAL    SOCIETY   LAW 

employment  of  Sears  by  the  association  Avas  prohibited  by  statute, 
with  which  he  is  presumed  to  have  been  familiar.  One  cannot  enter 
into  an  agreement  expressly  forbidden  by  statute  and  then  by  invok- 
ing the  plea  of  estoppel  evade  the  laws  of  the  State  and  reap  the 
fruits  of  such  agreement  as  fully  as  though  not  prohibited." 

First  National  Bank  vs.  Tlie  Church  Federation  of  America,  January, 
1906,  129  la.  268. 

Vested  Interests — Change  of  Beneficiary. 

The  beneficiary  in  a  certificate  issued  by  a  fraternal  society  has 
no  vested  interests  therein  during  the  life  of  the  member,  but  is 
sub.ject  to  the  rules  providing  for  a  change  of  beneficiary,  and  the 
beneficiary  cannot  ob.ject  to  any  change  actually  made  or  to  a  failure 
of  a  member  to  comply  with  any  formalities  in  making  an  attempted 
change,  provided  the  application  therefor  was  actually  made  and 
acted  upon  by  the  society  during  the  life  of  the  member. 

Wandell  vs.  The  Mystic  Toilers,  May,  1906,  130  la.  639. 

Change  of  Beneficiary — Estoppel. 

Where  the  member  executed  the  prescribed  application  for  a 
change  of  beneficiary  and  received  the  assurance  from  the  local 
representative  to  whom  the  same  was  delivered  in  accordance  with 
the  rules,  that  its  execution  was  proper  and  said  application  was 
received  and  acted  upon  by  the  society.  It  was  held,  that  the 
society  cannot  thereafter  contend  that  the  execution  of  the  applica- 
tion was  not  in  conformity  with  its  rules,  and  therefore  void. 

Wandell  vs.  The  Mystic  Toilers,  May,  1906,  130  la.  639. 

Vested  Rights — Amendment  of  Fundamental  Laws. 

On  the  (juestiou  of  vested  rights  the  court  in  speaking  of  jiower 
of  the  society  to  amend  its  fundamental  laws  said,  if  its  powers  are 
limited  by  the  articles  of  incorporation,  that  limitation  is  apt  and 
binding  iiiulci-  its  governing  jjower,  but  cannot  destroy  the  rights 
of   its   members    or    of   their   beneficiaries.      It    may    regulate   or 


THE    STATE    OF    IOWA  281 

control  the  exercise  of  these  rights  but  it  cannot  destroy  them. 
By-laws  of  a  business  corporation  are  merely  for  its  internal  govern- 
ment and  management  and  cannot  be  adopted  for  the  purpose  of 
changing  the  nature  of  business  or  of  amending  the  charter  or 
defeating  the  members  of  their  fundamental  rights.  These  by-laws 
so-called  which  fix  defendant's  rights  and  liabilities  to  its  members 
were  and  are  of  necessity  fundamental  laws,  no  matter  what  they 
may  be  called,  and  in  this  case  it  so  happens  they  are  called  "funda- 
mental laws." 

Van  Adtem  vs.  Modern  Brotherhood  of  America,  July,  1906,  131  la. 
232. 

Contracts  May  Limit  Time  for  Suing. 

A  contract  of  insurance  may  ignore  the  statute  of  limitations  and 
limit  the  time  within  which  an  action  on  the  contract  may  be 
brought,  but  the  time  within  which  action  may  be  brought  does  not 
commence  to  run  until  a  cause  of  action  accrues,  and  in  the  case  at 
bar  it  was  held  that  the  company  should  have  a  specified  time  in 
accordance  with  the  terms  of  the  contract  after  the  receipt  of 
proofs  of  loss  to  make  payment,  and  therefore,  that  the  cause  of 
action  thereon  did  not  accrue  until  the  expiration  of  the  specified 
time. 

Klisel  vs.  Mutual  Reserve  Life  Insurance  Company,  June,  1906,  131 
la.  54. 

Trustees  Not  Authorized  to  Amend  Charter. 

The  board  of  directors  of  a  fraternal  society  were  authorized  by 
its  constitution  to  adopt  such  by-laws  as  may  be  necessary,  but  not 
in  conflict  with  its  fundamental  law,  and  in  this  case  it  was  held 
that  the  board  had  no  power  to  amend  or  alter  the  charter  or  articles 
of  incorporation  which  were  held  to  bp  the  fundamental  law  of  the 
society. 

Van  Adtem  vs.  Modern  Brotherhood  of  America,  July,  1906,  131  la. 
232. 


282  FRATERNAL    SOCIETY    LAW 

Void  Amendments. 

It  was  held  that  where  the  directors  of  a  fraternal  society  may- 
amend  the  by-laws  by  two-thirds  vote  that  a  provision  not  shown 
to  have  been  so  adopted  will  be  held  invalid  by  the  court. 

Van  Adtem  vs.  Modern  Brotherhood  of  America,  July,  1906,  131  la. 
232. 

Where  the  assessments  on  the  members  of  a  particular  class  are 
made  for  the  purpose  of  creating  a  fund  for  the  payment  of  certifi- 
cates on  the  death  of  members  of  that  class,  it  was  held  that  the  dis- 
continuance of  the  class  did  not  affect  the  rights  of  the  beneficiary, 
nor  entitle  him  to  more  than  the  proceeds  of  an  assessment  on  all 
the  members  of  the  particular  class,  the  court  said: 

"The  appellee  concedes  in  argument  that  the  deceased  originally 
became  a  member  of  the  separate  or  woman's  class;  and  that  she 
never  was  transferred  to,  or  became  a  member  of  the  general  class, 
the  rights  of  the  certificate  holder,  and  the  amount  to  be  paid  upon 
the  death  of  a  member  were  fixed  by  the  constitution  and  by-laws 
of  the  ordei',  which  in  the  instant  case  provided  for  the  payment 
of  such  sum  as  would  be  realized  from  one  assessment  on  the  mem- 
bership in  good  standing  of  the  class  to  which  Miss  Kennedy  be- 
longed at  the  time  of  her  death,  and  it  is  also  conceded  by  the  ap- 
pellee that  but  for  the  action  of  the  defendant  providing  for  the 
abandonment  of  the  separate  or  woman's  class,  no  greater  sum 
could  be  rightfully  demanded  upon  the  death  of  a  member  of  that 
class  than  such  an  assessment  would  produce.  The  theory  of  the 
trial  court  and  the  theory  of  the  appellee  upon  the  trial  seems  to 
have  been  that  the  separate  class  was  discontinued  and  because 
thereof,  the  defendant  was  lidiind  to  assess  the  members  of  the 
general  class  for  the  payment  of  the  certificate.  In  any  view  which 
may  be  taken  of  the  case  pi-esented  by  the  pleadings,  this  theory 
is  unsound,  for  when  it  is  once  admitted  that  the  deceased  never 
became  a  member  of  the  general  class,  as  it  has  and  must  be  ad- 
mitted in  this  case,  it  is  clear  that  the  membership  of  such  class 
cannot  be  assessed  for  the  payment  of  this  certificate,  nor  has  the 
defendant  the  ])()wer  to  use  the  funds  which  have  been  derived  from 
assessments  of  sucli  membership  for  such  purpose. 


THE    STATE    OF    IOWA  ^83 

"The  members  in  good  stiiiidiiiu  nl'  llie  woman's  class  were  the 
only  members  of  the  order  which  conld  lenjally  l)e  called  upon  for 
an  assessment  in  this  ease." 

The  court  cited  in  support  of  this  contention  the  following: 

Theunen  vs.  The  Iowa  Mutual  Benefit  Association,  101  Iowa  558; 
Supreme  Lodge,  Knighits  of  Pythias  vs.  Knight,  117  Indiana  489,  20 

N.  B.  Rep.  479,  3  L.  R.  A.  409; 
Kennedy  vs.  Iowa  Legion  of  Honor,  April,  1904,  124  la.  66. 

Beneficiary — Divorced  Wife. 

The  statements  in  a  fraternal  society  certificate,  that  the  bene- 
ficiary is  the  wife  of  the  member,  is  descriptive  of  her  relation  to 
him,  and  is  not  a  provision,  for  payment  to  his  widow  in  the  case 
at  bar. 

The  contract  provides  for  the  payment  of  a  sum  upon  the  mem- 
ber's death  to  "Florence  H.  White,"  related  to  the  member  a» 
wife.  The  coui't  discussed  the  Iowa  statute,  relating  to  fraternal 
societies  and  the  provisions  thereof,  with  reference  to  beneficiaries 
and  said : 

"When  the  certificate  was  issued  the  appellant  was  the  wife  of 
A.  J.  White,  and  was  one  of  the  class  of  persons,  designated  by  the 
statute  and  by  the  laws  of  the  order,  as  a  competent  beneficiary. 
The  statement  that  she  was  related  to  the  member  as  wife,  was 
descriptive  of  her  relation  to  him  and  did  not  in  itself  provide  for 
payment  to  his  widow." 

The  court  cites  various  authorities  in  support  of  this  position  and 
proceeds : 

"The  statute  provides  only  for  the  relationship  that  shall  exist 
when  the  certificate  is  issued  and  does  not  in  any  way  or  by  fair 
implication  limit  to  those  only  who  occupy  such  relations  at  the 
time  of  death  of  the  member.  It  was  the  evident  intent  of  the  legis- 
lature to  prohibit  anything  in  the  nature  of  gambling  contracts,  and 
to  so  limit  the  beneficiaries  as  to  accomplish  such  a  result.  In  this 
case  the  member  had  made  no  effort  to  change  his  beneficiary, 
though  he  had  the  right  to  do  so,  and  he  knew  that  his  former 
wife  was  expressly  named  in  his  certificate."  And  the  court  closed 
its  opinion  with  the  following: 


284  FRATERNAL    SOCIETY    LAW 

"A  married  woman,  named  as  beneficiary  in  a  policy  of  insur- 
ance on  the  life  of  her  husband,  is  entitled  to  the  proceeds  of  the 
policy;  notwithstanding  a  divorce  was  obtained  by  her  before  his 
death." 

White  vs.  The  Brotherhood  of  American  Yeoman,  June,  1904,  124  la. 
293. 

Contract — Certificate  Need  Not  Be  Issued. 

Where  a  proposition  for  insurance  as  contained  in  the  application 
is  accepted,  there  is  a  contract  of  insurance  made,  though  no  policy 
or  certificate  is  issued,  in  the  absence  of  any  provision  to  the  con- 
trary. 

Herring  vs.  American  Insurance  Co.,  April,  1904,  123  la.  533. 

Warranty — False  Answers  In  Application. 

In  an  action  on  a  fraternal  society  certificate,  the  evidence  is  con- 
sidered and  held  to  show  that  the  answers  of  the  assured  in  his 
application,  regarding  his  condition  of  health  were  substantially 
false,  Ihus  rend6ring  the  contract  void. 

;  j 
Smith  vs.  Supreme  Lodge  of  the  Knights  and  Ladies  of  the  Golden 
Precept,  May,  1904,  123  la.  676. 

Fraternal  Societies  Exempt  From  Insurance  Laws. 

The  supreme  court  in  construing  section  6812  of  the  code,  which 
provides  that  tlie  taking  of  health  certificates  made  by  its  medical 
examiner  shall  estop  the  company  from  denying  that  the  assured 
was  in  the  condition  of  health  represented  therein,  unless  the  same 
was  the  result  of  fraud  of  the  insured.  Held,  that  it  had  no  appli- 
cation to  fraternal  societies,  which  were  exempt  from  the  provisions 
of  the  statute  relating  to  insurance  companies. 

Smith  vs.  Supreme  Lodge  of  the  Knights  and  Ladies  of  the  Golden 
Precept,  May,  1904,  123  la.  676. 


THE    STATE    OF    IOWA  285 

Valid  Contract  Though  Delivery  Not  Shown. 

A  policy  of  insurance  issued  to  a  resident  citizen  of  Iowa,  but 
executed  in  New  York  State,  and  which  provided  for  the  payment 
of  premiums  to  be  made  at  the  home  office  in  New  York,  was  held 
to  be  a  valid  contract,  although  it  contained  a  provision  that  it 
should  become  effective  only  on  delivery,  even  though  there  was  no 
showing  made  of  a  delivery  in  Iowa. 

Summit  vs.  United  States  Life  Insurance  Co.,  May,  1904,  l^'i  la.  681. 

False  Statement  in  Application — Knowledge  of  Agent  Imputed  to 
Society. 

A  misstatement  in  an  application  for  membership  in  a  fraternal 
accident  society,  to  the  effect  that  the  applicant  was  a  member  of 
another  fraternal  society  was  held  to  be  immaterial,  where  it  ap- 
peared that  the  agent  taking  the  application  was  fully  advised  of 
the  facts,  and  the  knowledge  of  the  agent  in  this  case  was  imputed 
to  the  society. 

Delaney  vs.  Modern  Accident  Club,  October,  1903,  121  la.  528. 

Precedent  Conditions — Agent's  Agreements. 

The  constitution  of  a  fraternal  accident  society,  provided,  as  a 
condition  precedent  to  membership  therein  that  the  applicant  must 
be  a  member  of  another  society  The  agent  of  the  defendant  ac- 
cepted the  plaintiff's  application,  knowing  that  this  condition  had 
not  then  been  performed,  l)ut  the  same  was  subsequently  done  in 
accordance  with  the  understanding  between  the  applicant  and  the 
agent  had  at  the  time. 

It  was  held  that  the  transaction  amounted  to  an  agreement,  that 
the  defendant's  certificate  should  not  be  in  force  until  the  appli- 
cant's compliance  with  the  condition  precedent,  and  that  the  agent 
had  authority  to  make  the  same. 

Delaney  vs.  Modern  Accident  Club,  October,  1903,  121  la.  528. 


286  FRATERNAL    SOCIETY    LAW 

Contract — Advertising  Which  Induced  Membership  Not  Part  of. 

lu  an  action  to  recover  on  a  benefit  certificate,  a  circular  letter 
which  may  have  induced  the  contract,  but  is  not  referred  to  or 
made  a  part  of  the  certificate  cannot  be  made  the  basis  of  recovery, 
but  should  be  stricken  from  the  pleadings. 

Sleight  vs.   Supreme  Council   of  Mystic   Toilers,   October,   1903,   121 
la.  724. 

Forfeiture — Self -executing  Provisions. 

A  provision  in  the  constitution  of  a  mutual  benefit  society,  pro- 
viding that  a  member  failing  to  pay  his  assessment  within  fifteen 
days  after  being  notified  by  the  secretary  to  do  so,  shall  be  sus- 
pended, was  held  to  be  not  a  self-executing  provision,  and  that  a 
member  who  had  failed  to  pay  within  the  time,  was  still  in  good 
standing,  when  it  was  shown  that  no  action  had  been  taken  to 
suspend  him. 

Jelly  vs.  Muscatine  City  and  County  llutual  Aid   Soci.,   May,  1903, 
120  Iowa  689. 

Denial  of  Liability  Waives  Proofs  of  Loss. 

Wliere  an  officer  of  a  fraternal  society  has  authority  to  waive 
proofs  of  loss  and  lie  writes  a  letter,  in  Avhich  he  says  the  claim  is 
not  valid, — by  reason  of  the  suspension  of  the  member,  and  makes 
no  objection  to  the  failure  to  make  proofs  of  loss,  it  was  held  that 
the  proofs  of  loss  were  waived. 

Alexander  vs.  Grand  Lods?e.  A.  U.  O.  AV.,  Feb.,  1903,  119  la.  519. 

Interest  Allowable  on  Claim. 

Where  a  fraternal  society  contends  that  it  is  not  liable  on  a  cer- 
tificate issued,  legal  interest  should  be  allowed,  though  the  jilaintiff 
is  a  non-resident,  and  no  tender  could  be  made  within  tlie  State, 
in  cases  where  ]ial)ility  was  fixed  by  the  conrt. 

Alexander  vs.  Gran<l  Lodge.  A.  U.  O.  W.,  Feb..  1903,  119  la.  .''119. 


THE    STATt:    OF    IOWA  287 

Presumptions — Burden  of  Proof. 

Proof  of  the  genuineness  of  the  signature  of  the  deceased  member 
to  a  letter  written,  direeting  a  ehange  of  his  beneficiary,  raises  a 
presumption,  that  the  same  was  voluntarily  made  and  signed,  with 
the  kniiwledge  of  its  contents,  and  one  asserting  undue  influence 
njinn  till'  mcnilier,  lias  the  liiirden  (if  pi'oof. 

Walts  &  Clark  vs.  Grand  Lodge   Iowa  Workman,  October,  1902,  11<S 
la.  216. 

Impaired  Health — Insanity  From. 

Age,  impaired  physical  vigor  and  at  time  faulty  and  irrational 
talk,  stupor  and  sluggishness,  the  result  of  disease  and  drugs  are 
held  not  to  be  sufficient  to  establish  permanent  insanity  or  imply 
such  mental  unsoundness  ns  to  make  it  impossible  for  a  member  to 
change  his  beneficiary. 

Walts  &  Clark  vs.  Grand  Lodge  Iowa  Workman,  October,  1902,  118 
la.  216. 

Answers  in  Application  Construed  Liberally  in  Favor  of  Applicant. 

In  a  member's  application  for  insurance,  he  was  asked,  "Has  any 
company  ever  declined  to  grant  insurance  on  your  life?"  To  which 
question  he  answered  in  the  negative. 

The  evidence  showed  that  on  a  similar  application  for  membership 
in  a  fraternal  societj^  he  was  asked:  "Have  you  ever  been  rejected 
for  life  insurance?  if  so,  state  when,  naming  the  company  or  order?" 
To  which  he  answered:  "Yes.  Modern  Woodmen  of  America,  one 
year  ago." 

It  was  held  that  since  there  is  a  clear  distinction  between  life 
insurance  companies  and  fraternal  societies,  that  the  question  asked 
by  the  defendant  of  the  member  in  the  case  at  bar,  referred  only  to 
insurance  companies,  and  that  the  member's  answer  was  not  false. 

It  was  held  further  that  under  such  circumstances  it  was  proper 
to  exclude  as  immaterial,  the  testimony  of  the  defendants  medical 


288  FRATERNAL    SOCIETY    LAW 

examiner,  that  h£  would  not  have  approved  the  application  had  he 
known  of  the  member's  rejection  by  the  fraternal  society. 

Newton  vs.  Southwestern  Mutual  Life  Association,  April,  1902,  116 
la.  311. 

Members  Must  Exhaust  Remedies  in  Society. 

Where  the  constitution  of  a  fraternal  society,  provided,  that  if  a 
member  should  consider  that  an  injustice  had  been  done  him.  by 
any  action  of  the  society,  that  he  might  appeal  to  the  supreme  coun- 
cil, it  was  held,  that  the  action  by  the  society  in  suspending  a  mem- 
ber will  not  be  reviewed  by  the  courts  when  no  such  appeal  was 
taken  by  the  agrieved  member. 

Finnerty  vs.  Supreme  Council,  Catliolic  Knights  of  America,  January, 
1902,  115  Iowa,  398. 

Beneficiary  Has  No  Vested  Interest  in  Certificate. 

The  beneficiarj^  named  in  a  fraternal  society's  certificate  is  not 
exempted  from  the  operation  of  the  rule,  providing  that  no  a.ction 
shall  be  begun  by  any  member  in  a  civil  case  until  he  has  exhausted 
his  remedies  within  the  society,  and  it  was  held  that  since  she  had 
no  vested  interest  in  the  certificate  until  the  death  of  the  member; 
and  that  he  had  failed  to  exhaust  his  remedies  in  the  society,  and 
thereby  lost  rights  that  he  otherwise  would  have  had;  that  the  bene- 
ficiary took  only  what  was  left. 

Finnerty  vs.  Supreme  Council,  Catholic  Knights  of  America,  January, 
1902,  115  Iowa,  398. 

Change  of  Beneficiary. 

A  member  of  a  fraternal  society  designated  his  wife  and  sister  as 
beneficiaries,  and  on  his  death  bed  he  requested  by  letter  that  his 
wife  be  made  the  sole  beneficiary.  The  letter  was  not  received  by 
the  society  until  aftei-  Ihc  member's  deatli,  wluMi  it  was  returned 
withniit   .-my  ;icti(ui  luiviiig  been  taken  tliei'eon.     Tlic  liv-laws  of  the 


THE    STATE    OF    IOWA  289 

society  prescril)ed  tli;it  the  fhiuiu'c  of  hi'iicficiai'v  of  :\  iiirnilicr  cduIiI 
be  made  by  his  certificate  being  surrendered  by  the  member  and 
upon  his  executing  a  request  for  the  change,  such  request  to  be 
executed  in  the  presence  of  the  clerk  of  the  local  camp.  It  was 
held  tiuit  the  change  of  beneficiary  could  l)e  made  only  in  the  mode 
described  by  the  by-laws  and  that  the  attempt  of  the  member  to 
make  a  change  in  the  manner  indicated  was  ineffectual. 

Modern  Woodmen  of  America  vs.  Little.  May,  1901.  114  Iowa,  109. 

Construction  of  Terms  of  Designation  of  Beneficiary. 

Where  a  policy  of  insurance  provided  that  the  company  would 
pay  the  amount  of  the  insurance  to  "H, "  wife  of  "M, "  his  exec- 
utors, administrators  or  assigns,  the  word  "His,"  was  held  to  refer 
to  "H"  the  member  and  not  to  the  wife. 

Haerther  vs.  Mohr,  October,  1901,  114  la,  636. 

Copy  of  Application  to  be  Attached  to  Certificate. 

Under  acts  of  the  18th  General  Assembly,  Code  211,  Section  2, 
requiring  an  application  for  insurance  to  be  attached  to  the  policy, 
and  precluding  the  company  or  association  from  asserting  the  mis- 
representations of  the  applicant  unless  so  attached;  in  case  of  failure 
to  do  so  was  held  that  a  fraternal  society  was  not  entitled  to  intro- 
duce an  application  not  attached  to  a  certifieate,  and  that  the  statute 
in  question  applied  to  fraternal  societies. 

Stork  vs.   Supreme  Lodge  Knights  of  Pythias,   December,   1900,  113 
Iowa  724. 

Conditions  Precedent  to  Liability. 

A  benefit  certificate  in  a  fraternal  society  provided  that  liability 
of  the  society  for  payment  thereunder  should  not  begin  until  the 
member  named  therein  should  have  paid  certain  fees,  amounting  to 
$6.40,  and  had  been  obligated  and  introduced  into  the  society  in 
due  form,  and  had  receiveii  his  certificate  and  that  these  should  be 
conditions  precedent  to  the  payment  of  IxMiefits,  in  the  case  of  the 
19 


290  FRATERNAL    SOCIETY    LAW 

member's  death.  The  society's  agent  iuduced  the  deceased  to  apply 
for  membership,  and  received  from  him  $3.00.  Under  the  agent's 
agreement  with  the  society,  he  was  to  retain  $5.00  as  his  personal 
compensation,  and  the  physician,  making  the  examination  of  the 
applicant  was  to  have  one  dollar.  The  deceased's  application  for 
membei'ship  was  accepted,  and  his  certificate  issued  and  counter- 
signed by  the  soliciting  agent,  who  endorsed  thereon,  "He  has  made 
all  payments  required  and  has  been  introduced  as  a  member  of 
this  camp."  And  such  agent  Avas  present  at  its  delivery,  and  had 
authority'  to  obligate  members.  It  was  held  that  since  there  was 
three  dollars  paid,  which  was  sufficient  to  cover  the  fees,  outside 
of  those  due  the  soliciting  agent,  and  the  examining  ph.ysician,  it  will 
be  deemed  that  the  agent  waived  payment  of  the  fees,  and  that  the 
deceased  had  completed  his  membership  in  the  society,  so  as  to 
entitle  his  beneficiaries  to  the  amount  of  the  certificate. 

Healy  vs.   Sovereign  Camp,  Woodmen  of  the  World,   October,   1900, 
112  Iowa  137. 

Warranty — Statements  by  Applicant  Previous  to  Making  Applica- 
tion, 

In  an  action  on  a  certificate,  one  of  the  defenses  was  a  breach  of 
warranty,  in  that  the  member  falsely  represented  that  he  never  had 
heart  disease.  The  only  evidence  that  he  ever  had  this  disease  was 
that  ten  months  prior  to  his  application  he  had  suft'ered  an  attack 
of  la  grippe,  and  he  later  stated  that  he  wanted  to  arrange  his 
affairs,  as  he  had  heart  trouble  seriously  and  might  die  at  any  time. 
At  the  time  of  his  application,  the  member  was  examined  b.v  a 
medical  examiner,  for  the  society  and  declared  by  him- to  be  a  good 
risk  and  liis  intimate  friends  testified  that  the  insured  was  not 
known  to  have  any  heart  trouble.  It  was  held  that  the  evidence 
was  not  sufficient  to  establish  a  breach  of  warranty  or  fraud,  in 
that  the  insured  had  heart  disease  prior  to  his  ap])lication  for  insur- 
ance. ' 


Metzradt  vs.  Modern  Brotherhood   of  America.   December.   1900.   112 
Iowa  522. 


THE    STATE    OF    IOWA  291 

Suicide — Coroner's  Verdict. 

The  verdict  ol'  the  coroiiei-'s  jury  was  admissible  in  evidence, 
which  showed  that  the  meiulier  died  by  his  own  liand;  a  lelter  was 
also  iutrotiuced,  written  by  the  memher  to  his  wife,  which  was  fiunid 
in  the  room  with  his  dead  botly.  This  letter  was  read  to  tiie  coro- 
ner's jury,  aud  according  to  the  testimony  of  members  of  that  jury, 
it  being  in  German  and  being  translated  to  them  its  contents  indi- 
cated that  tlie  member  was  about  to  suicide.  The  letter  was  in  evi- 
dence at  the  time  of  trial,  liut  no  expressions  of  the  kind  were  found 
in  it.  It  was  held  that  this  evidence  was  not  sufficient  to  overcome 
the  i)resumption  against  suicide. 

Metzradt   vs.   Modern   Brotherhood   of  America,   December.   lyiKl.   112 
Iowa  522. 

Waiver  of  Laws  by  Society. 

Where  an  assessment  life  insurance  association  insured  a  person 
on  an  a|)plicatioii  for  re-in.surance,  without  medical  examination,  as 
re(|uii'e(l  i)y  its  by-laws,  it  was  held  that  he  (•()uhl  not  resist  pay- 
ment of  assessments  for  such  reason  as  the  corjtoration  had  the 
power  to  waive  the  ])rovisions  of  its  laws. 

Watts  vs.  Equitable  Life  Association.  Ai)ril  l:',  1900.  Ill  Iowa  90. 

■•j 
Consolidation  of  Societies — Risks  Assumed. 

Where  a  mutual  insurance  associati(ui  transferred  its  membership 
to  another  association,  under  an  aiireement  that  the  latter  should 
carry  out  the  insurance  contracts  of  the  former,  such  an  arrange- 
ment was  held  not  to  be  an  agreement  to  insure  within  the  pro- 
visions of  the  code  prohibiting  such  an  association  from  insuring  a 
lierson  over  sixty-five  years  of  age,  and  hence  the  fact  that  a  mem- 
ber of  the  association,  whose  membership  was  so  transferred,  was 
over  sixty-five  years  of  age  at  the  date  of  the  agreement,  did  not 
release  the  latter  association  from  liability  on  his  certificate. 

Cathcart   &   Wetherell    vs.    Equitable   Miitual    Life   Association.   May. 
1900,  111  Iowa  471. 


292  FRATERNAL    SOCIETY    LAW 

Ultra  Vires  Contract — Consolidation. 

Where  a  mutual  insurance  association  received  a  transfer  of  all 
the  members  and  property  of  another  association  and  collected 
assessments  from  them,  as  its  members,  under  a  contract  to  perform 
the  former  association's  obligations,  and  provided  that  the  mortuary 
fund  contributed  by  the  members  who  should  thereafter  join  the  con- 
solidated association,  should  insure  to  all  of  the  members,  it  was 
held,  that  the  association  was  estopped  from  levying  an  assessment 
on  the  members  joining  after  the  consolidation  to  pay  beneficiaries 
of  a  member  of  the  former  association,  on  the  ground  that  the  con- 
tract was  ultra  vires. 

Cathcart  &  Wetherell   vs.   Equitable  Mutual  Life  Association.   May, 
1900,  111  Iowa  471. 

Rights  of  Old  Members  in  Consolidated  Societies. 

A  mutual  insurance  association,  which  had  issued  certificates 
to  its  members  requiring  it  to  levy  a  per  capita  assessment  at 
a  member's  death,  and  apply  the  proceeds  not  exceeding  .i<2,000  to 
the  member's  beneficiaries,  transferred  its  membership  to  another 
association,  under  an  agreement  that  its  transferred  members  .should 
be  entitled  to  full  rights  as  members  of  the  new  society.  It  was  held 
that  the  beneficiaries  of  the  transferred  members  were  not  entitled 
to  compel  the  defendant  to  apply  property  transferred  to  it  in  trust 
to  carry  out  the  terms  of  the  agreement,  in  the  absence  of  proof 
that   such  aiijilication  was  necessary  to  jiay   their  claim. 

Cathcart  &   Wetherell   vs.   Equitable   Mutual   Life   Association.   May, 
1900,  111  Iowa  471. 

Privileged  Communications. 

As  to  privileged  conununications  of  physicians,  and  communica- 
tions between  husband  and  wife,  see 

Shunian   vs.  Supreme  Lodge  Knishts  of  Honor.  February,  1900,  110 
Iowa  4S0. 


THE    STATE    OF    IOWA  293 

Change  of  Beneficiary. 

A  c'lijiii^'c  (if  bciicticMiH'y  ii;iiiiril  in  a  cert  ilii/alc  can  l)c  made  only 
in  the  manner  ami  form  proviileii  lor  h\  \\<v  laws  of  Ww  society. 

Sluiman  vs.  Grand  Lodge  A.  O.   U.  W.,  April.  ]9U0,  110  Iowa  642. 

Change  of  Beneficiary  Must  be  in  Manner  Prescribed  by  the  Laws, 

A  memlier  has  no  leeal  rieht  to  ciianee  liis  l)enefieiary,  except  as 
the  law  may  prescribe,  where  lie  has  held  his  certificate  for  more 
than  fifteen  year.s,  and  on  the  day  before  his  death,  changes  the 
beneficiary,  but  not  in  the  manner  jirovided  for  nnder  the  laws. 
Equity  will  not  treat  the  chane-e  as  havin<i-  been  leii'ally  made,  where 
no  reason  is  shown,  why  the  change  might  not  have  been  made 
prior  to  such  time  in  the  precise  manner  required  by  the  tei'ms  of 
the  contract. 

Sluiman  vs.  Grand  Lodge  A.  O.  U.  W.,  April,  1900,  110  Iowa  642. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

Proofs  of  death  are  waived  by  the  society,  denying  liability  by 
reason  of  the  charge  that  the  member  was  suspended. 

Parsons  vs.  Grand  Lodge  A.  O.  U.  W.,  April,  1899,  108  Iowa,  6. 

Presumption  That  Beneficiary  is  Qualified. 

On  the  issue  whether  the  claimant  under  a  certificate  is  legally 
the  beneficiary,  or  whether  she  is  the  legal  wife  of  the  member,  the 
court  said  that  it  will  be  presumed  that  the  member  obtained  a 
divorce  from  a  former  wife  before  he  married  the  claimant. 

Parsons  vs.   Grand  Lodge  A.  0.  U.  W.,  April,  1899,  108  Iowa,  6. 

Legal  Heirs  Includes  Illegitimate  Children. 

A  member  of  a  fraternal  society  had  designated  as  his  beneficiary 


294  FKATBRXAL     SOCIETY    LAM' 

his  legal  heirs.     It  w  ;is  held  that  illegitimate  ehihlren  were  included 
•within  this  term. 

Brown  vs.  Iowa  Legion  of  Honor,  January,  1S99,  107  Iowa,  439. 

Change  of  Beneficiary— Claimants  Cannot  Complain  of  Waiver  of 
Laws. 

While  a  l)y-law  of  a  fraternal  society  provides  the  manner  in 
which  a  change  of  beneficiary  may  be  made  a  member's  failure  to 
comply  with  same,  cannot  be  taken  advantage  of  by  persons  claim- 
ing the  benefit,  yet  such  claimant  may  question  whether  a  change  in 
beneficiary  has  actually  been  made. 

Depee  vs.  Grand  Lodge  A.  0.  U.  W.,  October.  189S.  106  Iowa  747. 

After-enacted  Laws — Reserve  Power. 

After-enacted  by-laws  were  held  not  to  affect  a  contract  already 
made,  when  it  did  not  appear  that  the  power  to  amend  the  laws  had 
been  preserved. 

Carnes  vs.  The   Iowa   State   Travelling   Men's  Ass'n,   October.    1898, 
106  Iowa  281. 

Suicide — Death  From  Overdose  of  Poison. 

Whei-c  the  death  of  ;i  jiieiiiber  is  caused  by  his  taking  more  mor- 
l)liiiie  than  he  intended,  it  was  held  that  this  was  not  a  death  by 
suicide. 

Carnes   vs.   The   Iowa   State   Travelling  Men's  Ass'n.   October.   1S9S. 
106  Iowa  281. 

Forfeitures,  Waivers  by  Agents. 


On  the  question  of  agency  and  the  liability  of  the  society  for  the      ' 
conduct  and  course  of  dealing  of  an  agent  with  the  members,  the 
Supreme  Court  of  Iowa  in  a  well  considered  ease,  and  after  citing 
many  authorities,   announces  its  conclusions   in   the  followine:  Ian- 


\ 


THE   STATE    OF    IOWA  295 

guage:  "It  must  be  borne  in  mind  that  no  matter  how  stringent 
the  condition  upon  which  the  continued  validity  of  the  contract  of 
insurance  is  made  to  depend,  the  company  or  association  is  under  no 
obligation  to  enforce  it.  If,  then,  such  company  or  association  itself 
or  by  its  agent  (and  it  can  act  only  by  agent)  adopts  a  method  of 
business  by  which  premiums  or  assessments  are  habitually  collected 
and  received  for  a  period  of  several  days  after  they  become  delin- 
quent according  to  the  strict  letter  of  the  contract,  no  forfeiture  or 
suspension  is  declared  thereon,  but  such  members  are  recognized 
as  being  at  all  times  in  good  standing,  and  by  this  course  of  business 
members  have  reason  fairly  to  eoncliule  that  the  insurer  does  not 
insist  upon  literal  compliance  witli  the  tei-ms  of  the  contract  in  this 
respect :  then  it  will  not  be  heard  to  deny  the  good  standing  of  a 
member  who  has  depended  upon  the  custom  observed  by  an  agent, 
and  has  paid  or  offered  to  pay,  his  assessments  in  accordance  there- 
with." 

Trotter  vs.  Grand  Lodge  of  Iowa,  Legion  of  Honor,  December,  1906, 
Supreme  Court  of  Iowa,  109  N.  W.  1099. 

Waivers  Depends  Upon  Effect  on  Opposite  Party. 

The  question  of  waiver  and  Avhether  it  will  be  found  in  any  par- 
ticular case  depends  "not  upon  the  intention  of  the  parties  against 
whom  it  is  asserted,  but  on  the  effect  which  his  conduct  or  course  of 
business  has  had  i^pon  the  other  party." 

Trotter  vs.  Grand  Lodge  of  Iowa,  Legion  of  Honor,  December,  1906, 
Supreme  Court  of  Iowa,  109  N.  W.  1099. 

Absence  of  Collecting  Officer. 

Where  a  collecting  officer  is  absent  from  his  home  at  the  time  when 
assessments  are  payable,  it  is  held  that  under  such  circumstances  the 
members  are  entitled  to  a  reasonable  time  after  the  return  of  the 
collecting  officer  to  make  payments. 

Trotter  vs.  Grand  Lodge  of  Iowa,  Legion  of  Honor,  December,  1906, 
Supreme  Court  of  Iowa,  109  N.  W.  1099. 


296  FRATERNAL    SOCIETY    LAW 

Agency — What  Determines. 

On  the  question  of  the  agency  of  a  collecting  officer,  and  his 
power  to  bind  the  society,  the  Court  said:  "There  is  no  magic  in 
the  mere  name  of  a  thing,  and  if  an  act  done  or  performed  by  one 
person  or  party  for  or  in  behalf  of  another  is  in  its  essential  nature 
one  of  agency,  then  the  former  is  the  agent  of  the  latter.  This  prin- 
ciple has  been  often  enforced  as  between  the  insurer  and  the  insured, 
and  the  person  appointed  or  designated  to  receive  payment  of 
prmiums  and  assessments  held  to  be  the  agent  of  the  insurer,  even 
where,  by  the  terms  of  the  contract,  it  is  provided  that  he  shall  be 
regarded  as  the  agent  of  the  insured." 

Trotter  vs.  Grand  Lodge  of  Iowa,  Legion  of  Honor,  December.  1906, 
Supreme  Court  of  Iowa,  109  N.  W.  1099. 

Agency  in  Collecting  Assessments — Course  of  Dealing. 

A  member  of  a  society  was  a  banker  and  the  collecting  officer  car- 
ried his  account,  as  collector,  in  this  member's  bank  for  many 
years.  When  the  collector  got  ready  to  remit  the  amount  of  his  col- 
lection he  would  procure  from  the  bank  exchange  for  the  amount 
to  be  remitted,  including  the  amount  due  from  the  banker,  and  the 
banker  would  have  transferred  from  his  account  to  the  collector's 
account  on  the  books  of  the  bank,  the  amount  of  the  banker's  pay- 
ment. The  Court  held  that  under  such  facts  a  forfeiture  of  the 
banker's  certificate  could  not  be  asserted  when  it  appeared  that  the 
banker  had  died  without  having  actually  made  the  payment  due  to 
the  collector. 

Wood  vs.  Iowa  Legion  of  Honor,  Jan..  1907,  Supreme  Court  of  Iowa, 
110  N.  W.  164. 

Warranty  as  to  Age. 

The  statement  of  an  ai)]ilieant  in  his  application  as  to  his  age 
was  held  to  be  a  warranty,  and  if  false  rendered  the  certificate  void, 

Krause  vs.  Modern  Woodmen  of  America,  Feb.,  1907,  Supreme  Court 
of  Iowa,  no  N.  W.  452. 


THE   STATE  OF  IOWA  297 

Local  Officer  Agent  of  Society. 

The  Scribe  oi'  tin-  local  Court  rcfjuircd  to  collt'ct  moneys  and  dues 
from  the  members  of  the  Court  and  to  remit  same  to  the  society  was 
held  to  bo  the  agent  of  the  society  and  not  the  agent  of  the  local 
court,  though  the  laws  of  the  soeiet\-  so  deelared.  and  though  the 
local  court  elects  such  Scribe. 

Davidson    vs.    Supreme    Tribe   of   Ben    Hur,    March,    1907,    Supreme 
Court  of  Iowa,  111  N.  W.  46. 

Waiver  of  Laws  by  Local  Officers  Allowed. 

The  laws  of  a  society  provided  that  waiver  by  receiving  payment 
of  dues  should  not  be  deemed  a  waiver  save  upon  the  knowledge  of 
the  ca.se  by  the  society ;  but  this  provision  was  held  inapplicable  in 
view  of  the  conduct  of  the  local  collecting  ofSeer  in  making  his 
collection  from  members  long  after  thej-  were  due.  The  Court 
reviewed  the  authorities  and  adhered  to  the  doctrine  announced  in 
Trotter  vs.  Grand  Lodge  (Iowa)  109,  N.  W.  1099. 

Davidson  vs.  Supreme  Tribe  of  Ben  Hur,  March,  1907,  111  N.  W.  46. 

Beneficiary — Divorced  Wife  Competent. 

A  member's  certificate  was  issued  payable  to  his  wife  who  sub- 
sequently was  divorced  from  him.  No  change  of  designation  was 
made  and  at  the  member's  death,  the  wife  claimed  the  amount  of 
benefit.  The  laws  of  the  society  jjrovided  that  a  beneficiary  should 
"be  one  or  more  members  of  his  family  or  related  to  or  dependent 
upon  him."  The  Court  held  after  reviewing  the  authorities  that  the 
divorced  wife  was  entitled  to  the  benefit. 

Schmidt  vs.   Hauer,  May,   1907,  Supreme  Court  of  Iowa.  Ill  N.  W. 
966. 

Conditions  Precedent  to  Liability. 

The  laws  of  a  society  required  that  application  for  membership 
should  be  submitted  to  the  subordinate  lodge  and  if  applicants  were 


298  FliATERNAL    SOCIETY    LAW 

elected  by  the  lodge  they  should  be  examined  by  the  medical  ex- 
aminer, and  that  if  the  applications  were  approved  by  the  society 
the  certificate  should  be  forwarded  to  the  local  lodge  which  would 
deliver  the  same  to  the.  applicants  after  the  applicant's  adoption 
into  the  lodge.  It  was  held  that  the  adoption  of  a  candidate  was  a 
condition  precedent  to  membership,  imless  such  condition  was 
waived. 

Bruner  vs.  Brotherhood  of  American  Yeomen,  May,  1907,   Supreme 
Court  of  Iowa,  111  N.  W.  977. 

Actions  at  Law  Proper  on  a  Certain  Indefinite  Contract. 

A  certificate  entitled  a  named  beneficiary  to  participate  in  the 
mortuary  fund  to  the  amount  of  one  full  assessment  on  all  members 
in  good  standing,  not  to  exceed  $2,000.  Action  was  brought  to  re- 
cover on  a  certificate  by  the  beneficiary  of  a  deceased  member,  such 
action  being  in  law ;  and  the  defense  was  urged  that  the  action 
should  be  brought  in  equity.  The  Court  denied  this  contention  and 
held  that  the  beneficiary  might  recover  in  an  action  at  law. 

Van    Norman    vs.    Modern    Brotherhood    of    America,    May,     1907, 
Supreme  Court  of  Iowa,  111  N.  W.  992. 


i 

'i 


THE    STATE    OE    KANSAS  299 


THE 

STATE  OF  KANSAS. 

CHAPTER  17. 

(General  Statutes  of  19(11.  C'hap.  ;")().  Articles  f.  and  S.) 

Societies  for  Payment  of  Death  Benefits. 

Section  3568.  §  214a.  A  fraternal  beneficiary  association  is  hereby 
declared  to  be  such  a  corporation,  society  or  voluntary  association 
of  individuals,  formed  or  organized  into  a  lodge  system  with  ritual- 
istic form  of  work,  or  composed  of  members  of  an  order  or  society 
having  a  lodge  system  with  ritualistic  form  of  work,  or  of  such 
members,  their  wives,  widows,  or  daughters,  as  shall  make  provision 
for  the  payment  of  benefits  in  case  of  death,  sickness,  or  temporary 
or  i)ermanent  disability,  and  shall  be  carried  on  for  the  sole  benefit 
of  its  members  and  their  beneficiaries,  and  not  for  profit.  Every 
fraternal  beneficiary  association  as  herein  defined  shall  have  a  repre- 
sentative form  of  government,  with  provisions  for  corporate  meet- 
ings, and,  subject  to  compliance  with  its  constitution  and  laws, 
shall  make  provision  for  the  payment  of  benefits  in  case  of  death, 
and  may  make  provision  for  the  payment  of  benefits  in  case  of  sick- 
ness, temporary  or  permanent  disability,  either  as  a  result  of  disease, 
accident,  or  old  age :  Provided,  The  period  of  life  at  which  payment 
of  physical  disability  benefits  on  account  of  old  age  commences  shall 
not  be  under  seventy  years.  The  ftuul  from  which  the  payment  of 
the  benefits  of  such  association  shall  be  made,  and  the  fund  from 
which  the  expenses  of  such  association  shall  be  defrayed,  shall  be 
derived  from  assessments,  premiums  or  dues  collected  from  its 
members,    and    interest    accumulations    thereon.       The    payment    of 


300  FRATERNAL    SOCIETY    LAW 

death  benefits  of  such  an  association  shall  be  to  the  families,  heirs, 
blood  relatives,  affianced  husband  or  affianced  wife  of,  or  to  persons 
dependent  upon  the  members  thereof.  Such  associations  may  create, 
maintain  and  disburse  a  reserve  or  emergency  fund  in  accordance 
with  their  constitution  or  by-laws.  Such  association  shall  be  gov- 
erned by  this  act,  and  shall  be  exempt  from  the  provisions  of  other 
insurance  laws  of  this  State,  and  no  law  hereafter  passed  shall  apply 
to  them  unless  they  be  expressly  designated  therein.  |L.  1898,  ch. 
23.  ;;  1,  as  amended  by  L.  1899,  ch.  147.  §  1 ;  May  15.] 

Existing  Societies. 

Section  3569.  §  215.  All  such  associations  coming  within  the  de- 
scription as  set  forth  in  Section  1  of  this  act,  organized  under  the 
laws  of  this  or  any  other  State,  province,  or  territory,  and  now  doing 
business  in  this  State,  ma.y  continue  such  business,  provided  that  they 
shall  show  to  the  satisfaction  of  the  superintendent  of  insurance 
that  their  plan  of  organization  is  in  keeping  with  Section  1  of  this 
act.  All  such  societies  shall  hereafter  be  governed  by  this  act,  (and 
shall  hereafter  comply  with  the  provisions  of  this  act  regulating 
annual  reports  and  the  designation  of  the  sujierintendeut  of  insur- 
aiu-e  as  the  person  upon  whom  process  may  be  served  as  hereinafter 
provided.)     [L.  1898,  ch.  23,  §  2;  March  1.] 

Foreign  Associations. 

Section  3570.  ij  216.  Any  such  association  coming  within  the 
description  as  set  forth  in  Section  1  of  this  act,  organized  under 
the  laws  of  any  other  State,  province,  or  territory,  and  not  now  doing 
business  in  this  State,  shall  be  admitted  to  do  business  within  this 
State  when  it  shall  have  filed  with  the  superintendent  of  insurance 
a  duly  certified  copy  of  its  charter  and  articles  of  association,  and  a 
copy  of  its  constitution  and  laws,  certified  to  by  its  secretary  or 
corresjionding  officer,  and  a  statement  of  its  Inisiness  during  the  pre- 
ceding year,  in  the  form  jirovided  for  in  Section  4  of  this  act,  to- 
gether with  an  api)ointnieiit  of  the  superintendent  of  insurance  of 
this  State  as  a  person  upon  whom  process  ma.v  be  served  as  herein- 
after provided :  And  provided,  That  such  association  shall  be  shown 


I 


THE    STATE    OF    KANSAS  P,Ol 

to  he  ;m11i(ii-i/.('tl  (ci  ilo  hiisincss  in  tlic  Stale,  province  or  tei'ritory 
ill  which  it  is  iucorjiorated  or  organized,  in  case  the  hiws  of  such 
State,  province  or  territory  shall  provide  for  such  aiithoi'i/ation ; 
and  ill  ease  tiie  laws  of  such  State,  province  or  territory  do  not  pro- 
vide for  an\-  formal  authorization  to  dn  business  on  the  pai't  of  any 
siicli  association,  then  such  association  shall  he  shown  to  he  conduct- 
ing its  luisiuess  in  accordance  with  the  provisions  of  this  act.  For  all 
the  purposes  of  this  act,  the  superintendent  of  insurance  of  this 
State  may  personally,  or  hy  some  person  to  he  designated  by  him. 
examine  into  the  condition,  affairs,  character  and  business  methods, 
accounts,  books  and  investments  of  any  such  association  at  its  home 
office,  which  examination  shall  be  at  the  expense  of  tlie  jissociation  : 
Provided,  That  sucli  expense  shall  not  exceed  the  sum  of  fifty  dol- 
lars and  necessary  traveling  expenses;  and  such  e::amination  may 
be  repeated  whenever  deemed  necessary  by  the  sui)eriiiti'ndent  of  in- 
surance. No  such  association  organized  under  the  laws  of  any  otlier 
State,  territory  or  province  shall  be  admitted  to  do  business  in  this 
State  unless  it  is  shown  that  one  assessment  u])on  its  members,  at 
the  current  rates,  will  produce  sufficient  funds  to  pay  a  claim,  under 
its  largest  certificate,  in  full.     [Id.,  §  3.] 

Statement  to  be  Filed. 

Section  3571.  §  217.  Every  such  association  doing  business  in 
this  State  shall,  on  or  before  the  1st  day  of  Jfarch  of  each  year,  make 
and  tile  with  the  sup(M-intendent  of  insurance  of  this  State  a  report 
of  its  affairs  and  operations  during  the  year  ending  on  the  31st  day 
of  December  immediately  preceding,  which  annual  report  shall  be 
in  lieu  of  all  other  reports  required  by  any  other  law.  A  fee  of 
twenty  dollars  shall  accomiiany  such  annual  report.  Such  reports 
shall  be  upon  blank  forms  to  be  provided  by  the  superintendent  of 
insurance,  and  shall  be  verified  ixnder  oatli  by  the  duly  authorized 
olificers  of  such  association,  and  shall  be  published,  or  the  substance 
thereof,  in  the  annual  re]iort  of  the  superintendent  of  insurance 
under  a  separate  part,  entitled  "fraternal  l)enefieiary  associations," 
and  shall  contain  answers  to  the  following  questions: 

1st.     Number  of  certificates  issued  during  the  year,  or  members 
admitted. 


302  FRATERNAL    SOCIETY    LAW 

2d.     Amount  of  indemnity  affected  thereby. 

3d.     Number  of  losses  or  benefit  liabilities  incurred. 

4th.     Number  of  losses  or  benefit  liabilities  paid. 

5th.     The  amount  received  from  each  assessment  for  the  year. 

6th.  Total  amount  paid  members,  beneficiaries,  legal  represen- 
tatives, or  heirs. 

7th.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

Sth.  Number  aud  kind  of  claims  compromised  or  resisted,  and 
brief  statement  of  reasons. 

9th.  Does  association  charge  annual  or  other  periodical  dues  or 
admission  fees? 

10th.  How  much  on  each  one  thousand  dollars  annually  or  per 
capita,  as  the  case  may  be? 

11th.  Total  amount  received,  from  what  source,  and  the  dis- 
position thereof. 

12th.     Total  amount  of  salaries  paid  to  officers. 

13th.  Does  association  guarantee,  in  its  certificates,  fixed  amounts 
to  be  paid  regardless  of  amount  realized  from  assessments,  dues,  ad- 
mission fees,  and  donations? 

14th.  If  so,  state  amount  guaranteed,  and  the  security  for  such 
guaranty. 

15th.     Has  the  association  a  reserve  fund? 

16th.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested? 

17th.     Has  the  association  nuire  than  one  class? 

18th.     If  so.  how  many,  and  the  amount  of  indemnity  in  each? 

lf)th.     Number  of  members  in  each  class. 

2(lth.     If  voluntary,  so  state,  and  give  the  date  of  organization. 

21st.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  what  tinu>,  giving  chapter  and  year  and  date  of  passage  of 
the  act? 

22d.  If  organized  under  the  laws  of  any  other  State,  province, 
or  territory,  state  such  fact  and  the  date  of  organization,  giving 
chapter  and  year,  date  of  passage  of  the  act. 

23d.  Number  of  certificates  of  beneficiary  membership  lapsed 
(luriiiu-  the  \'ear. 


I 


THE    STATE    OF    KANSAS  303 

2-lth.  Nninhcr  in  foroe  at  hciiiiiiiing  and  v\)d  of  year;  it'  more 
than  one  class,  number  in  each  class. 

25th.  Names  and  addresses  of  its  i)rcsident,  secretary,  and  treas- 
urer, or  corresponding  officers. 

The  superintendent  of  insurance  is  authorized  and  empowered 
to  address  any  additional  inquiries  to  any  such  association,  in  rela- 
tion to  its  doings  or  condition,  or  any  other  matter  connected  with 
its  transactions  relative  to  tiic  i)iisiness  contemplated  by  this  act, 
and  such  officers  of  such  association  as  the  superintendent  of  insur- 
ance may  require  shall  promptly  reply,  in  writing,  under  oath,  to 
all  such  inquiries.     [Id.,  §  4.] 

Service  of  Process. 

Section  3572.  §  218.  Each  such  association  now  doing  or  here- 
after admitted  to  do  business  within  this  State,  and  not  having  its 
principal  office  within  this  State,  and  not  being  organized  under  the 
laws  of  this  State,  shall  appoint,  in  writing,  the  superintendent  of 
insurance  and  his  successors  in  office  to  be  its  true  and  lawful  at- 
torney, upon  whom  all  lawful  process  in  any  action  or  proceeding 
against  it  may  be  served ;  and  in  such  writing  shall  agree  that  any 
lawful  process  against  it  which  is  served  on  said  attorney  shall  be 
of  the  same  legal  force  and  validity  as  if  served  iipon  the  associa- 
tion, and  that  the  authority  shall  continue  in  force  so  long  as  any 
liability  remains  outstanding  in  this  State.  Copies  of  such  certifi- 
cate, certified  by  said  superintendent  of  insurance,  shall  be  deemed 
sufficient  evidence  thereof,  and  shall  be  admitted  in  evidence  with 
the  same  force  and  effect  as  the  original  thereof  might  be  admitted. 
Service  upon  such  attorney  shall  be  deemed  sufficient  service  upon 
such  association.  When  legal  process  against  any  such  association 
is  served  upon  said  superintendent  of  insurance  he  shall  immediately 
notify  the  association  of  such  service  by  letter,  prepaid,  and  directed 
to  its  secretary  or  corresponding  officer,  and  shall,  within  two  days 
after  such  service,  forward  in  the  same  manner  a  copy  of  the 
process  served  on  him  to  such  officer.  The  plaintiff'  in  such  process 
so  served  shall  pay  to  the  superintendent  of  insurance,  at  the  time 
of  such  service,  a  fee  of  two  dollars  and  fifty  cents,  which  shall  be 
recovered  by  him  as  a  part  of  the  taxable  costs,  if  he  prevails  in 


304  FRATERNAL   SOCIETY   LAW 

the  suit.  Such  superintendent  shall  keep  a  suitable  record-book,  in 
■which  he  shall  docket  everj^  action  commenced  against  such  associa- 
tions or  corporations,  the  time  when  commenced,  the  date  and  man- 
ner of  service ;  also,  the  date  of  the  judgment,  its  amount  and  costs, 
and  the  date  of  payment  thereof,  which  shall  be  certified  from  time 
to  time  by  the  clerk  of  the  court  in  which  such  action  was  brought. 
[Id.,  §  5.] 

Permit. 

Section  3573.  §  219.  The  superintendent  of  insurance  of  this 
State  shall,  upon  the  application  of  any  association  now  organized 
and  having  the  right  to  do  business  within  this  State  as  provided  by 
this  act,  issue  to  such  association  a  permit  in  writing,  authorizing 
such  association  to  do  business  within  the  State,  for  which  certifi- 
cate and  all  proceedings  in  connection  therewith  such  association 
shall  paj'  to  said  superintendent  of  insurance  a  fee  of  twenty-five 
dollars;  and  any  association  of  the  character  described  in  Section  1 
of  this  act,  organized  under  any  other  law  of  this  State  and  now 
doing  business  therein,  may  reincorporate  under  the  provisions  of 
this  act  by  resolution  of  their  governing  body,  certified  to  the 
siiperintendent  of  insurance.  Upon  receipt  of  such  resolution,  so 
certified,  and  the  payment  of  a  fee  of  twenty-five  dollars,  said 
superintendent  of  insurance  shall  issue  to  said  corporation  a  certifi- 
cate of  authority  to  transact  business  in  accordance  with  the  pro- 
visions of  this  act,  and  thereafter  such  associations  shall  be  deemed 
fully  incorporated  under  the  provisions  of  this  aet.     [Id.,  §  6.] 

How  Organized. 

Section  3574.  §  220.  Seven  or  more  persons,  citizens  of  the  United 
States,  and  a  majority  of  whom  are  citizens  of  this  State,  who  may 
desire  to  form  a  fraternal  beneficiary  association,  as  defined  in  Sec- 
tion 1  of  this  act.  may  make,  sign,  seal  and  acknowledge  before 
some  officer  authorized  to  take  acknowledgments  of  deeds,  a  cer- 
tificate in  writing,  in  which  shall  be  stated:  (a)  The  names  and 
places  of  residence  of  the  applicants,  (b)  Proposed  corporate  name 
of  the  association,  whieli  shall  iio(  loo  closely  rescmlilc  llie  name  of 


THE    STATE    OF    KASSAS  305 

any  similar  associalidii.  (c,)  Tln'  object  <ii'  pui'posr  lor  wliirh  I  Ik; 
incorporatiou  is  sought,  including  the  plan  of  oi'sanization  and 
method  of  condnctino'  the  business,  including  provision  for  corporate 
meetings  for  tile  adoi)tion  or  amendment  of  articles  of  association 
and  by-laws  and  the  election  of  officers,  to  be  held  at  least  biennially, 
(d)  The  location  ol'  the  ])rincipal  office,  which  must  be  within  this 
State,  (e)  Number  of  directors  or  similar  governing  officers,  and 
their  names  and  residence,  who  shall  manage  the  business  of  the 
corporation  for  the  first  year,  or  until  the  next  corporate  meeting. 
AVhen  said  certificate  has  been  dul.v  signed  and  acknowledged  l),y 
the  proposed  incorporators  it  shall  be  tiled  with  the  superintendent 
of  insurance  of  this  State,  and  in  case  the  superintendent  of  insur- 
ance shall  find  that  its  provisions  are  in  accordance  with  Section  1 
of  this  act,  he  shall  issne  to  said  incorporators  duplicate  copies  of 
said  application,  with  his  certificate  indorsed  thereon  that  said  cor- 
poration has  been  dul.y  authorized  to  coneluct  the  business  provided 
for  in  its  said  application,  according  to  the  provisions  of  this  act. 
When  one  of  said  certified  copies  shall  have  been  filed  for  record  in 
the  office  of  the  register  of  deeds  of  the  county  in  which  the  prin- 
cipal office  shall  have  been  established,  the  remaining  copy  shall 
constitute  the  articles  of  association  of  said  corporation:  Provided, 
That  said  superintendent  of  insurance  shall  not  issue  said  certified 
copies  until  said  incorporators  have  paid  him  a  fee  of  twenty-five 
dollars  and  shall  have  satisfied  him  that  there  have  been  obtained 
bona  fide  applications  for  membership  and  insnrance  in  said  pro- 
posed association  from  at  least  five  hundred  applicants,  and  that  a 
benefit  fund  had  been  established,  and  cash  deposited  therein  to  an 
amount  at  least  ecpial  to  twice  the  amount  of  the  lowest  certificate 
proposed  by  said  association,  and  the  proposed  by-laws,  benefit  cer- 
tificate and  applieaticm  have  been  submitted  to  said  superintendent 
of  insura7ice  and  found  to  be  not  in  conflict  with  this  act.     [Id..    §7.] 

Shall  be  Body  Corporate. 

Section    3575.      §  221.      A   fraternal    assessment   order   organized 

under  the  provisions  of  this  chapter  shall  be  a  body  corporate  and 

politic  by  the  name  stated  in  the  certificate  of  organization,  and  b.v 

that  name  they  and  their  successors  may  have  succession,  and  shall 

20 


306  FNATERNAL    ttOCIETY    LAW 

be  persons  in  law,  capable  of  suing  and  being  sued,  and  may  have 
power  to  make  and  enforce  contracts  in  relation  to  the  Inisiness  of 
their  corporation ;  maj-  have  and  use  a  common  seal,  and  may  change 
or  alter  the  same  at  pleasure;  and  they  and  their  successors  in  their 
corporate  name  shall,  in  law,  be  capable  of  taking,  purchasing,  hold- 
ing and  disposing  of  real  and  personal  estate  for  the  purpose  of 
their  corporation ;  may,  by  its  board  of  officers,  trustees  or  represen- 
tatives composing  its  governing  body,  make  by-laws  not  inconsistent 
with  the  constitution  and  laws  of  this  State  or  of  the  United  States, 
and  such  by-laws  shall  jjrovide  for  annual  or  biennial  meetings  and 
provide  the  manner  of  filling  vacancies  in  the  board  of  officers ;  and 
whenever  officers  or  trustees  are  elected,  a  certificate  under  the  seal 
of  the  corj)oration,  giving  name  and  residence  and  term  of  officers 
elected,  which  term  of  officers  elected  shall  not  exceed  four  years, 
shall  l)e  forwarded,  duly  certified,  to  the  superintendent  of  insurance. 
The  governing  body  shall  also  fix  the  compensation  of  all  executive 
officers  of  the  corporation  in  full  compensation  of  services;  and  it 
shall  not  be  lawful  for  any  officer  to  take  or  receive  any  of  the 
money  or  funds  of  such  corporation  in  excess  of  the  anKuuit  of 
salary  so  fixed,  and  such  salarv  shall  not  be  increased  during  the 
term  for  which  officers  are  elected.  It  shall  be  unlawful  for  an 
officer  of  such  corporation  to  use  or  expend  any  portion  of  the  mortu- 
ary fund  or  emergency  fund  for  expense  purposes,  and  any  officer 
who  shall  authorize  or  use  any  portion  of  such  funds  for  expense 
purposes  shall  forfeit  his  office  and  become  personally  liable  to  the 
cor|)()ratiiiii  for  all  sums  so  illegally  exiM:>nded.     [Id..  §8.] 

Certificates — When  Issued. 

Section  3576.  S  222.  No  association  incorporated  under  the  pro- 
visions of  this  act  shall  issue  any  certificate  of  membership  or  benefit 
certificate  until  its  benefit  fund  shall  contain  an  amount,  in  cash,  at 
least  equal  to  twice  the  amount  of  its  smallest  proposed  death  benefit 
certificate ;  and  if  at  the  incorporation  of  any  such  association  its 
proposed  officers  shall  contribute  any  sums  to  such  benefit  fund,  they 
may  be  afterward  reimbursed  from  a  siiecial  expense  fund,  which 
may  be  contributed  for  that  ])urpose  by  the  members.  No  such 
association   shall    issue   beiu'fit    certificates   except   for  the   smallest 


THE    STATE    OF    KANSAS  307 

amount  jn-ovidi'il  lor  by  its  laws,  unlil  ils  membership  shall  be  such 
that  one  assessment  upon  each  will  produce  sufficient  funds  to  pay 
its  proposed  next  largest  benefit  certificate  in  full ;  a  similar  restric- 
tion shall  apply  until  the  number  of  its  membership  shall  authorize 
the  issuance  of  its  maximum  certificate.     [Id.,  §  9.] 

May  Amend  Articles. 

.Section  3577.  §  2'2'S.  Any  such  a.ssociation  incorporated  under 
the  provisions  of  this  act  ma.y  amend  its  articles  of  association  in  the 
manner  provided  for  in  its  by-laws,  and  may  provide  for  the  meeting 
of  its  legislative  or  governing  body  in  any  other  State,  province  or 
territory  wherein  such  association  shall  have  subordinate  bodies,  and 
all  business  transacted  at  such  meetings  shall  be  valid  in  all  respects 
as  if  such  meetings  were  held  within  this  State:  and  where  the  laws 
of  any  such  association  provide  for  the  election  of  its  officers  by 
votes  to  be  cast  in  its  subordinate  bodies,  the  votes  so  cast  in  its 
subordinate  bodies  in  any  other  State,  province,  or  Territory  shall 
be  valid  as  if  east  within  this  State ;  and  whenever  any  such  asso- 
ciation shall  amend  its  laws  it  shall  be  the  duty  of  its  secretary  or 
corresponding  officer  to  file  with  the  superintendent  of  insurance 
of  this  State  a  certified  copy  of  all  such  amendments  within  thirty 
days  after  the  adjournment  of  the  nu^eting  at  which  such  amend- 
ments were  made.     |  Id.,  §  10.] 

Benefits  Exempt. 

Section  3578.  S  2:24.  The  money  or  other  benefit,  charity,  relief 
or  aid  to  lie  paid,  provided  or  rendered  by  any  association  author- 
ized to  do  business  vuider  this  act  and  the  reserve  or  emergency  fund 
of  such  association  shall  not  be  liable  to  attachment  by  trustee,  gar- 
nishee, or  other  process,  and  shall  not  be  seized,  taken,  appropriated 
or  apjilied,  by  any  legal  or  equitable  process  or  l)y  oiieration  of  law, 
to  i)ay  any  debt  ov  liability  of  a  certificate-holder  or  of  any  bene- 
ficiary named  in  the  certificate,  or  any  person  who  may  have  a  right 
thereunder,  and  shall  be  exempt  from  all  taxes.  [Id.,  §  11,  as 
amended  bv  L.  1901,  ch.  6(3  S  1 :  .Alav  7. 1 


308  FRATERNAL    SOCIETY    LAW 

Fraud  Punished. 

Section  3579.  §  225.  Any  person,  officer,  member  or  examining 
phj'sician  who  shall  knowingly  make  any  false  or  fraudulent  state- 
ment or  representation,  in  or  with  reference  to  any  application  for 
membership  or  medical  examination,  or  for  the  i)urpose  of  obtain- 
ing any  money  or  benefit  in  any  association  transacting  business 
under  this  act,  shall  be  guilty  of  a  misdemeanor,  and  upon  convic- 
tion shall  be  punished  by  a  fine  of  not  less  than  one  hundred  dollars 
nor  more  than  five  hundred  dollars,  or  imprisonment  in  the  county 
jail  for  not  less  than  thirty  days  nor  more  than  one  year,  or  Ijoth, 
in  the  discretion  of  the  court;  and  any  pei'son  who  shall  knowinsily 
make  a  false  statement  of  any  material  fact  or  thing  in  a  sworn 
statement  as  to  the  death  or  disability  of  a  certificate-holder  in  any 
such  association,  for  the  purpose  of  prociu-ing  payment  of  a  benefit 
named  in  the  certificate  of  such  holdi'i-.  ami  any  person  who  shall 
knowingly  make  any  false  statement  in  any  verified  report  or  dec- 
laration under  oatli,  required  or  antliorized  by  this  act.  shall  bi- 
guilty  of  perjury,  and  shall  be  proceeded  against  and  punished  as 
provided  by  the  statiites  of  this  State  in  relation  to  the  crime  of 
perjury.     [Id.,  §  12.] 

Penalties  for  Neglect. 

Section  .3580.  §  226.  Any  association  authorized  to  do  business 
under  this  act  refusing  or  neglecting  to  make  the  reports  provided 
for  in  this  act,  or  which  shall  exceed  its  powers,  or  shall  conduct  its 
business  fraudulently,  or  which  shall  take  steps  to  remove  any  suit 
commenced  against  it  in  any  of  the  courts  in  this  State  to  any  of  the 
courts  of  the  T^nited  State,  or  which  shall  fail  to  ])ay  any  judgment 
rendered  against  it  in  any  coiii-t  in  this  State,  una|)pealed  from, 
within  six1y  days  of  the  rendition  of  such  judgment,  or  which  shall 
fail  to  comply  with  any  of  the  provisions  of  this  act,  shall  be  ex- 
cluded from  doing  business,  within  this  State.  Whenever  it  shall 
come  to  the  knowledge  of  the  superintendent  of  insurance  that  any 
association  authorized  to  do  business  under  the  ])rovisi()ns  cif  this 
act  has  so  conducted  its  business  as  to  render  it  liable  to  exclusion 
as  herein  provided,  he  shall  give  notice  in  writing  to  the  attorney- 


TlIK    tiTATli    OF    KAXt<AS  309 

jjciiiT.-il,  wliii  sluill  iiii.iii'ilialcly  f(iiiiiii('iice  an  action  in  one  of  tlie 
disli-ict  courts  oi  this  State  to  enjoin  such  association  fi'oni  soliciting 
any  new  business  within  this  State.  No  association  doinu'  business 
uniler  this  act  shall  have  authoi-ity  to  solicit  or  initiate  new  members 
after  notice  of  the  commencement  of  such  injunction  proceedings 
by  the  attorney-general,  until  sneh  time  as  such  injunction  proceed- 
ings shall  be  finally  disi)osed  of.  If,  pending  such  proceedings,  the 
occasion  thereof  shall  he  removed  aii<l  tln'  costs  of  such  ])rocee(ling-s 
paid  by  such  association,  the  proceedings  may  be  dismissed  by  the 
attorney-general  on  recommendation  of  the  superintendent  of  insur- 
ance, and  thereupon  said  association  shall  be  allowed  to  again  tran.s- 
act  business  in  this  State.  In  case  of  -a  perpetual  injunction  allowed, 
under  the  provisions  of  this  section,  against  an  association  incorpora- 
ted under  this  act  or  other  law  of  Kansas,  such  iujiuietion  shall  be 
sufficient  cause  for  the  appointment  of  a  receiver  by  any  court  of 
competent  jurisdiction,  to  wind  up  the  affairs  of  such  association. 
No  injunction  shall  be  granted  by  any  court  in  this  State  against 
any  association  authorized  to  do  business  under  this  act,  except 
on  application  of  the  attorney-general,  at  the  request  of  the  super- 
intendent of  insurance.     [Id.,  §  13.] 

Penalty. 

Section  3581.  §  227.  Any  person  who  shall  act  as  officer,  agent, 
solicitor,  or  otherwise,  within  this  State,  for  any  association  which 
shall  have  failed,  neglected  or  refused  to  comply  with  or  shall  have 
violated  any  of  the  provisions  of  this  act,  or  shall  have  failed  or 
neglected  to  procure  from  the  superintendent  of  insurance  authority 
to  transact  within  this  State  the  business  provided  for  in  this  act, 
or  at  any  time  when  such  association  shall  have  been  notified  of  the 
pending  of  injunction  proceedings  b.y  the  attorney-general  against 
it,  shall  be  deemed  guilty  of  a  misdemeanor,  and  on  conviction 
thereof  shall  be  pimiished  by  a  fine  of  not  less  than  twenty-five  dol- 
lars or  more  than  two  hundred  dollars,  or  by  imprisonment  in  the 
count.y  jail  not  less  than  thirt.v  days  nor  more  than  one  year,  or 
by  both  such  fine  and  imprisonment,  in  the  discretion  of  the  court. 
[Id.,  ^  14.] 


3J0  FRATERNAL    SOCIETY    LAW 

Powers  of  Superintendent. 

Section  3582.  §228.  None  of  the  provisions  of  this  act  shall  be 
construed  as  vesting  discretionary  power  in  the  superintendent  of 
insurance,  but  his  construction  of  and  decisions  under  any  section  of 
this  act  shall  stand  and  be  binding  on  all  parties  in  interest  until 
revei'sed  by  a  court  of  competent  jurisdiction  in  an  action  in  the 
nature  of  an  action  in  mandamus,  to  be  prosecuted  at  his  or  its 
own  cost,  by  any  person  or  association  dissenting  from  such  con- 
struction or  decision.     [Id..  §  15.] 

Not  Apply. 

Section  3583.  S  229.  Nothing  herein  contained  shall  apply  to 
grand  or  subordinate  lodges  of  any  fraternal  society  wherein  the 
only  benefits  provided  for  are  sick  or  funeral  benefits  not  to  exceed 
two  hundred  dollars  on  any  one  case,  nor  which  limits  its  member- 
ship to  a  particulai-  trade  or  calling,  or  the  employee  of  a  particular 
person,  firm  or  corporation,  nor  to  any  class  of  United  States  gov- 
eriiiiient  employees,  formed  exclusively  for  their  own  or  their  fami- 
lies' protection  against  sickness,  accident,  or  death.  [L.  1898,  eh.  23, 
§  16,  as  amended  by  L.  1899,  ch.  148,  §  1;  May  15.] 

Eepeal. 

Section  3584.  §230.  A]\  laws  and  parts  of  laws  inconsistent 
with  this  act  are  hereby  repealed.     [Id.,  §  17.] 

Agents'  License. 

Section  •3589.  §  235.  That  any  fraternal  association,  mutual  life 
insurance  company,  mutual  fire  insurance  company,  mutual  accident 
insurance  comjiany.  ami  inuliial  building  and  loan  association,  organ- 
ized and  existing  \uider  the  laws  of  the  State  of  Kansas,  and  the 
agents  and  representatives  of  any  such  association  or  company,  act- 
ing in  the  capacit}'  of  such  agent  and  representatives,  shall  be 
exenipl  from  the  payment  of  any  license  tax  imposed  b.y  any  city, 
when  the  cliarter  of  such  assixfiation  or  company  shows  i1  was  organ- 


THE  STATE  OF  KANSAS  oil 

ized  for  mutn;il  puriiiiscs  ;iiid  not  for  i)rofit.     [L.  1901,  ch.  261,  §  1; 
Mar«h  15.] 

Beginning  of  Liability — Conditions  Precedent. 

The  constitution  of  ;i  frnternal  society  i^rovided  that  "no  bene- 
ficiary certificate  shall  be  or  become  effective  and  in  force  until 
executed  by  the' supreme  president  and  supreme  secretary  and  coun- 
tersigned by  the  president  and  secretary  of  the  local  council  to  which 
the  member  may  belong,  and  the  conditions  of  the  certificate  accepted 
by  the  member  to  whom  it  is  issued  in  writing  on  his  certificate ;  and 
it  was  held  that  a  monthly  assessment  paid  at  the  time  of  making 
an  application  by  the  applicant  cannot  be  applied  before  such  con- 
stitutional provision  of  the  society  was  complied  with,  said  pro- 
vision of  the  constitution  being  held  effectual  for  the  jjurpose  of 
determining  when  liability  under  the  contract  began. 

The  Triple  Tie  Benefit  Association  vs.  Wood,  February  10th,  1906, 
73   Kans.  124;   S4  Pac.  565. 

Limited  Time  to  Appeal  Suits. 

'  ^   '  I 
The  fraternal  beneficiary  act  of  Kansas  provides  in  Sec.  13  (§  3580) 

that: 

"Any  association  authorized  to  do  business  under  this  act  re- 
fusing or  neglecting  to  make  the  reports  provided  for  in  this  act, 
or  which  shall  exceed  it^  powers,  or  sliall  conduct  its  business  fraudu- 
lently, or  which  shall  take  steps  to  remove  any  suit  commenced 
against  it  in  any  of  the  courts  of  this  State  to  any  of  the  courts  of 
the  United  States,  or  which  shall  fail  to  pay  any  judgment  rendered 
against  it  in  any  court  in  this  State,  nnappealed  from,  within  sixty 
days  from  the  rendition  of  snch  .judgment,  or  which  shall  fail  to 
comply  with  any  of  the  provisions  of  this  act,  shall  be  excluded  from 
doing  business  within  this  State." 

Other  litigants  in  this  State  under  the  statutes  of  the  State  are 
given  one  year  within  which  to  perfect  appeals  from  judgments. 
The  provision  above  quoted  was  upheld  by  the  court,  which  declared 
that  fraternal  societies  under  said  provision,  in  view  of  rights  of 
other  litigants,  was  not   (b_»nied   the   equal   protection   of  the  laws. 


312  FRATERNAL    SOCIETY    LAW 

The  court  approved  the  doetrine  in  the  case  of  Modern  Woodmen 
vs.  Heath,  71  Kans.  148 ;  79  Pac.  1091. 

The   Sons   and   Daughters   of   Justice   vs.   Swift,   March   10th,    1906, 
73  Kans.  255;   84  Pac.  984. 

Parole  Evidence  Received  to  Vary  Contract. 

lu  a  suit  to  avoid  a  written  contract  of  life  insurance  and  recover 
premiums  paid  thereon,  on  the  ground  that  the  plaintiff  had  no 
opportunity  to  read  the  contract,  and  was  induced  to  execute  the 
same  bj'  false  and  fraudulent  repj^sentations,  the  rule  that  parole 
evidence  will  not  be  i-eceived  of  conversations  between  the  contract- 
ing parties  prior  to  the  signing  of  the  contract,'  for  the  purpose 
of  disputing,  altering,  ov  changing  the  terms  of  the  contract  was 
held  not  to  apply. 

The  State  Life  Insurance  Co.  vs.  Johnson,   May  12,  1906,  73  Kans. 
567;  85  Pac.  597. 

Notice  of  Powers  of  Societies  Imputed. 

Every  person'  dealing  with  a  fraternal  incorporated  society  or  with 
its  obligations  is  bound  to  take  notice  of  the  power  possessed  by 
such  coi-poration,  and  for  the  purpose  for  which  it  was  created. 

Scott  vs.  Banlvers'   Union   of  the   World,  May  12th,   1906,   73   Kans. 
575;   85  Pac.  604.  ' 

Corporate  Powers  of  Society — Limitations. 

An    incorjjorated    fraternal    society,    organized    under    a    charter 

which  does  not  expressly  confer  the  power  to  issue  promissory  notes, 

has  no  implied  power  to  do  so,  when  such  authority  is  unnecessary 

to  enable  the  society  to  exercise  the  powers  expressly  given  it  to 

accomiilisli  the  purpose  of  its  creation. 

For  ;i  full  discussion  of  the  powers  of  fraternal  societies  see  this 
very  interesting  and  iiniinrtant  case. 

Scott  vs.  Banlcers'  Union  of  the  World,  May  12th,  1906,   73  Kans. 
575;   85  Pac.  604. 


THE    STATE    OF    KANSAS  313 

After-enacted  Laws — Prohibited  Occupations. 

The  adiiptioii  by  a  fraternal  society  of  a  h\-law  declariiii;-  that 
no  person  shall  be  admitted  or  retained  as  a  member  who  is  engaged 
in  the  sale  of  intoxicating  liquors,  does  not,  in  the  absence  of  a 
specific  provision  to  that  effect,  avoid  the  beneficiary  certificate  of  a 
member  who  is  already  engaged  in  that  business  in  a  State  where  it 
is  not  unlawful,  and  who  continues  therein,  and  against  whom  no 
action  is  taken. 

Grand  Lodge  A.  O.  U.  W.  vs.  Haddock,  October  7th,  1905,  72  Kans. 
35;  82  Pac.  583. 

Forfeiture  for  Entering  Prohibited  Occupation — Amended  By-laws. 

A  b.y-law  adopted  by  a  fraternal  society  wliich  jn'ovides  that  any 
member  who  shall,  after  the  date  of  its  adoption,  have  entered  into 
or  who  shall  thereafter  enter  into  the  bitsiness  of  selling  intoxicating 
liquors  shall  stand  suspended  from  his  rights  to  participate  in  the 
beneficiary  fund,  and  that  his  certificate  shall  thereby  become  void 
from  the  date  of  his  so  engaging  in  such  occupation,  does  not  in 
terms  apply  to  the  ease  of  a  member  who,  prior  to  that  time,  so  en- 
gaged in  such  business  and  who  remains  in  it  continuously  thereafter, 
and  it  will  be  held  by  the  court  not  to  effect  such  member. 

Grand  Lodge  A.  0    U.  W.  vs.     Haddock,  October  7th,  1905,  72  Kans. 
35;   82  Pac.  583. 

Pleading  Precedent  Conditions  Required. 

In  an  action  to  recover  on  an  insurance  contract  the  plaintiff  must 
plead  and  prove  the  performance  of  all  precedent  conditions,  or  the 
waiver  of  the  same  by  the  insurer.  Where  performance  of  such  con- 
ditions is  pleaded,  a  general  denial  puts  in  issue  the  same. 

Shawnee  Fire  Ins.  Co.  vs.  Knerr,  Dec.  9th,  1905,  72  Kansas  385;   83 
Pac.  611. 

Presumption  of  Death  from  Absence. 

In  order  that  a  presumption  that  a  person  once  shown  to  have  been 


314  FRATERNAL    .SOCIETY    LAW 

alive  continues  to  live  may  be  overcome  by  the  presumption  of  death 
arising  from  seven  years'  unexplained  absence  from  home  or  place 
of  residence,  there  must  be  a  lack  of  information  concerning  the 
absentee  on  the  part  of  those  likely  to  hear  from  him,  after  diligent 
inquiry. 

Modern  Woodmen  of  America  vs.   Gerdom,   December   9th,    1905,    72 
Kans.  391;  82  Pac.  1100. 

Disappearance — Presumptions — Absence  for  Seven  Years, 

In  passing  upon  a  disajapearance  case  the  court  in  speaking  upon 
the  duty  of  the  plaintiff  said  : 

"All  those  persons  who  in  the  ordinary  course  of  events  would 
likely  receive  tidings  if  the  party  were  alive,  whether  members  of 
his  family  or  not,  should  be  interrogated,  and  the  result  of  the  in- 
quiry should  be  given  in  e\idence,  or  the  testimony  of  the  parties 
themselves  should  be  produced  at  the  trial.  Any  word  received 
by  any  one  who  might  naturally  be  exjjected  to  hear  at  any  time 
within  the  seven-year  period  destroys  the  presumption  of  death,  and 
unless  the  resources  of  this  field  of  information  have  been  exhausted, 
an  allegation  of  death  cannot  be  successfully  sustained." 

Modern  Woodmen  of  America  vs.    Gerdom,    December   9th,    1905,    72 
Kans.  391;  82  Pac.  1100. 

Time  to  Perfect  Appeals  from  Judgments. 

Litigants  generall\-  within  the  State  of  Kansas  have  one  year 
within  which  to  appeal  from  .judgments  rendered  against  them,  but 
under  the  fraternal  beneficiary  act  fraternal  societies  have  only  sixty 
days.    In  pa.ssing  upon  this  discrimination  the  court  said  : 

"The  association  is  a  foreign  corporation,  and  the  legislatnrt>  lias 
the  right  to  pre.scribe  the  terms  upon  which  it  and  other  like  corpora- 
tions may  do  business  in  Kansas.  It  did  prescribe  the  condition  that 
all  judgments  nnappealed  from  within  sixty  days  after  rendition 
must  be  paid.  In  effect,  it  said  to  such  associations:  'You  are  given 
sixty  days  witliin  which  to  take  an  appeal,  and  if  it  be  not  taken 
within  that  time  the  end  of  the  litigation  has  been  reached.'    It  is 


THE    HTATE    OF    KANf^AS  315 

lidt  ciKiujili  tliJit  steps  he  liilccn  tnwnrd  perfecting  iiti  ;i|)pi';il,  liiil  the 
apjieal  must  Ix'  completed,  jiiul  it'  lluit  he  not  clone  within  the  sixty 
days,  the  judgment  is  tiiud,  and  tlu'  only  alternative  is  payment. 
We  cannot  suppose  that  the  h'gislature  intended  to  treat  the  judg- 
ment as  a  tinality  and  compel  its  payuu-nt  and  sii'terwards  allow  a 
legal  combat  over  a  controversy  that  had  been  ended. 

"Payment  of  the  judgment  was  in  fact  made,  but  it  was  done  in 
obedience  to  a  demand  of  the  superintendent  of  insurance,  and  under 
protest.  No  doubt  the  superintendent  of  insurance  would  have  exer- 
cised the  power  reposed  in  him  by  statute  to  compel  i)ayment  if  it 
had  been  refused,  and  in  a  sense  the  payment  was  involuntary.  The 
coercion,  however,  was  by  force  of  the  law  itself.  It  commanded 
the  payment  which  was  made.  By  coming  into  the  State,  and  avail- 
ing itself  of  the  advantages  afforded  by  the  statute  the  association 
impliedly  agreed  to  comply  with  the  statute  and  to  pay  all  judgments 
from  which  it  did  not  appeal  within  sixty  days." 

Modern  Woodmen  vs.  Heath,  Marcli  11,  1905.  71  Kans.  148;   79  Pac. 
1091. 

Forfeiture — Custom  of  Receiving  Payments. 

Where  a  member  of  a  fraternal  society  offers  to  pay  dues  assessed 
against  him  and  is  ready  and  willing  to  pay  to  the  officer  whose 
duty  it  is  to  receive  them,  and  such  officer,  doubting  his  power  in 
the  premises,  refused  to  accept  the  offered  payment,  the  society 
cannot  declare  a  forfeiture,  nor  will  it  be  permitted  to  assert  a  for- 
feiture for  the  non-payment  of  assessments  which  were  not  made 
as  reipiired  by  its  by-laws,  where  it  is  shown  that  the  society  had 
adopted  the  custom  and  course  of  dealing,  which  led  the  members 
honestly  to  believe  that  the  assessments  might  be  paid  and  received 
at  times  other  than  those  stated  in  the  by-laws. 

Foresters  of  America  vs.  Hollis.   October   8.   1904.   70   Kans.   71;    78 
Pac.  160. 

Beneficiary — Ineligibility  Not  Raised  in  Pleadings. 

A  member  obtained  a  certificate  on  his  life  payable  to  his  stepson. 
His  stepson  brought  suit  to  recover  upon  the  certificate  after  the 


31g  FRATERXAL     SOCIETY     LAW 

death  of  the  member.  There  was  no  issue  raised  in  the  pleadings 
as  to  the  right  of  tlie  stepson  to  take  the  benefit.  His  right  was  ques- 
tioned for  the  first  time  by  the  society  in  requesting  an  instruction  on 
the  subject  to  be  given  by  the  court  to  the  .jury.  The  court  refused  to 
give  the  instruction  aslied,  error  was  assigned,  and  the  supreme 
court  said  that  the  trial  court  rightly  refused  to  submit  the  ques- 
tion to  the  jury,  as  it  should  have  been  put  in  issue  by  the  pleadings. 

Foresters   of   America  vs.   Hollls,   October   8th,   1904,    70   Kans.   71; 
78  Pac.  160. 

Change  of  Beneficiary. 

A  fraternal  society  by-law  provided  that  "No  change  in  beneficiary 
shall  be  effective  until  the  delivery  of  a  new  certificate,  and  until 
such  time,  the  old  certificate  shall  be  lield  to  be  in  force."  A  mem- 
ber of  a  society  executed  a  surrender  clause  in  due  form  «u  the 
back  of  his  certificate,  and  changed  the  name  of  his  beneficiary 
from  his  wife  to  his  brother.  The  certificate  was  then  mailed  to  the 
head  clerk  in  another  State,  who  had  tlie  power  to  make  the  change 
and  issue  the  new  certificate.  Before  its  receipt  by  this  clerk,  how- 
ever, the  member  died.  No  new  certificate  was  is.sued.  In  an  action 
brought  by  the  brother  against  the  society  to  recover  the  amount, 
it  was  held  that  he  could  not  recover  as  the  change  of  beneficiary 
had  not  taken  place. 

Kemper    vs.    Modern   Woodmen    of    America,    November    5th,    1904, 
70  Kansas  119;    78   Pac.  452. 

Agency — Assistant  to  Collecting  Officer — Estoppel. 

Tlie  l)y-]a\vs  of  a  fraternal  society  provided  that  subordinate 
lodges,  so  desiring,  might  have  an  assistant  clerk.  For  two  months, 
both  in  the  presence  and  absence  of  its  clerk,  a  mendjer  of  the  sub- 
ordinate lodge  habitually  received  and  receipted  for  dues  and  assess- 
ments in  the  name  of  the  clerk,  in  regular  lodge  meetings,  and  with 
the  knowledge  and  consent  of  the  subordinate  lodge.  During  the 
period  f)f  the  month,  in  the  absence  of  the  clerk,  this  member  per- 
formed the   hitter's  duties  in  taking  down  and  recording  minutes 


THE    STATE    OF    KANSAS  317 

of  the  meetings,  eollecthig  assessments  and  dues,  entering  payments 
made  by  members  on  the  books  of  the  lodge,  making  reports  to  the 
Supreme  clerk,  all  with  the  knowledge  and  acquiescence  of  the  sub- 
ordinate lodge.  This  same  member  assisted  a  new  clerk,  who  sub- 
sequently took  office  in  making  up  the  reports  required  and  in  per- 
forming other  duties.  Held  that  such  conduct  was  sufficient  to 
constitute  such  member  jui  assistant  clerk,  so  that  payment  of  dues 
and  assessments  made  to  such  assistant  clerk  by  members  would 
bind  the  soeiet.y  whether  such  payments  finalls'  reached  the  supreme 
body  or  not. 

Woodman  Circle  vs.  Stretton,  February    6th,    1904.    68    Kansas,    403 
75    Pac.    477. 

Incontestability — Suicide. 

A  contract  in  a  fraternal  society  provided  that  it  should  be  incon- 
testable after  two  years  from  its  date.  The  member  who  held  this 
contract,  which  was  payable  to  his  wife,  committed  suicide  after 
the  two-year  period  had  elapsed.  The  society  refused  to  pay,  alleg- 
ing that  the  member  suicided.  The  court  held  that  the  defense  of 
suicide  could  not  be  set  up  in  view  of  said  incontestable  clause. 

Court  of  Honor  vs.   Updegraff,   February,   1904,   68  Kansas   474;    75 
Pac.   477. 

Resort  to  Civil  Courts — Duty  of  Members  to  Exhaust  Remedies  in 
Society. 

A  member  of  a  fraternal  society  who  is  denied  rights  and  benefits 
to  which  he  claims  to  be  entitled  under  its  laws  must  avail  himself 
of  the  right  of  appeal  provided  by  the  laws  of  the  society  for  the 
redress  of  grievances  before  he  can  resort  to  the  civil  courts.  A 
failure  to  seek  such  method  of  review  by  the  holder  of  a  benefit 
certificate,  whose  tender  of  monthly  dues  was  refused  b.y  the  secre- 
tary, and  who  thereby  became  suspended  from  the  society,  will  defeat 
an  action  brought  against  the  society  on  such  licnefit  certificate  b.v 
the  member's  beiu'fieiarv  after  the  member's  death. 


318  FRATERNAL    SOCIETY    LAW 

Modern  Woodmen  of  America  vs.  Taylor,  March  7tli,  1903,  67  Kansas 
368:    71   Par.   806. 

Agency  of  Local  Secretary. 

Where  the  laws  of  a  fraternal  society  authorize  the  local  secretary 
to  collect  dues  and  assessments  of  the  members,  and  also  provides 
that  the  society  shall  be  liable  for  benefits  upon  payment  of  dues 
by  its  members  to  the  local  secretary,  and  where  the  certificate  of 
membership  recognizes  the  authority  of  the  local  secretary  to  receive 
payments  from  the  members,  and  further  provides  that  the  failure 
to  make  payments  to  hini  shall  avoid  the  certificate,  such  local  secre- 
tary may  be  held  to  be  deemed  to  be  the  agent  of  the  society. 

Fraternal   Aid   Assn.   vs.   Powers,   July   10th,   1903,   67   Kansas   420; 
73  Pac.  65. 

Surplus  Credits  of  Member  in  Hands  of  Society. 

Where  by  reason  of  excess  payments  made  by  members  to  the 
local  secretary  for  dues  and  assessments,  money  is  in  the  hands  of 
the  secretary,  to  the  credit  of  such  member,  more  than  is  necessary 
to  meet  claims  which  have  accrued,  it  should  be  applied  to  subse- 
quent and  aceruing  dues  and  assessments,  and  the  nunuber  will  not 
be  deemed  to  be  in  default  so  long  as  such  excess  is  sufficient  to  meet 
the  accruing  claims  of  the  society  against  the  member. 

Fraternal  Aid   Association   vs.   Powers.   July   10th.   1903,   67   Kansas 
420,  73  Pac,  65. 

Powers  Under  Charter — Consolidation — Ultra  Vires  Contracts, 

A  fr;itcrii;d  society  has  only  such  powers  as  are  expressly  con- 
ferred upon  il  liy  its  charter,  or  such  as  are  necessarily  im]ilied 
therefrom,  to  enable  it  to  carry  out  the  objects  of  its  creation.  The 
exercise  of  all  other  powers  by  it  are  ultra  vires  and  void.  A  con- 
tract of  consolidation  between  two  societies  whereby  on(>  society 
is  to  p;iy  all  death  losses  of  another,  which  have  alread\-  accrued, 
in  cniisidcration  of  the  transfer  to  the  one  of  the  membershii)  and 


THE    HTATE    OF    KAPHAS  319 

funds  of  sui'li  (itlior  soeic'ty  is  liclil  Id  lir  iiiihiwfiil  jind   iiltrji   vires. 

Bankers'  Union  vs.  Crawfonl.  .Inly  imh,  1903,  67  Kas.  449;  73  Pac.  79. 

Ultra  Vires  Agreements — Estoppel. 

A  society  which  hris  entered  into  .-in  ;iL;ri'i'nicnt  to  consolidate 
with  nnother,  assuming-  the  payment  of  death  losses  which  have 
;drcMd\-  accrued  is  not  estopped  to  deny  tlic  ultra  vires  character  of 
sncli  assumption  by  reason  of  the  fact  that  large  numbers  of  mem- 
bers of  the  latter  society  were  induced  to  become  members  of  the 
former;  nor  by  the  further  fact  that,  by  the  resignation  of  the 
officers  of  the  latter  society,  it  was  ])laced  in  the  liands  of  the  officers 
named  by  those  who  were  managing  the  former. 

Bankers'  Union  vs.  Crawford.  July  Kitli,  1903,  67  Kansas  449;  73  Pac. 
79. 

Situs — Conflict  of  Jurisdictions — Void  Procedure. 

A  beneficiary's  certificate  issued  by  a  fraternal  society,  suable 
in  ilissouri.  in  favor  of  minor  children  domiciled  in  Missouri,  has 
its  legal  situs  at  their  domicil.  and  is  an  asset  in  the  hands  of  a 
guardian  appointed  there,  and  the  presence  of  the  paper  in  another 
State  does  not  authorize  the  appointment  of  a  guardian  for  the 
minors  in  such  other  State.  A  judgment  of  a  probate  court  appoint- 
ing a  guardian  under  such  circumstances  is  void  for  want  of  ."juris- 
diction, and  may  be  attacked  collaterally  in  an  action  brought  by 
persons  claiming  under  such  appointment. 

The   Modern  Woodmen  of  America  vs.   Hester,  January   10th,  1903, 
66  Kansas  129;   71  Pac.  279. 

Proofs  of  Death  Waived  by  Refusal  of  Blanks. 

Where  the  by-laws  of  a  fraternal  society  provide  that  proofs  of 
death  must  be  made  on  blanks  furnished  by  its  officers,  and  where 
such  officers  upon  reasonable  demand  refuse  to  furnish  such  blanks, 
the  society  cannot  take  advantage  from  the  failure  of  a  claimant 
to  make  such  proofs  of  death. 


320  FRATERNAL    SOCIETY    LAW 

Ancient  Order  of  Pyramids  vs.   Dralie  &  Morgan,  April  11th,  1903, 
66  Kansas  538;  72  Vac.  239. 

Local  Secretary  Agent  of  Supreme  Body. 

Where  the  by-laws  of  a  fraternal  society  require  a  member  to 
make  payments  of  stated  assessments  to  the  local  secretary,  and  no 
other  method  is  afforded  b>'  which  he  can  make  such  payments,  a 
provision  of  such  by-laws  which,  in  substance,  declares  the  local 
secretary  to  be  the  agent  of  the  member,  and  denies  the  member 
the  benefit  of  a  payment  made  to  such  secretary  unless  he  actually 
forwards  the  amount  received  to  the  general  treasurer,  is  held  to 
be  invalid  and  will  not  be  given  effect  in  court. 

Ancient  Order  of  Pyramids  vs.  Drake  &  Morgan.  April   11th,  1903, 
66  Kansas  53S;   72  Pac.  239. 

Taxation  Exemptions. 

A  fraternal  society  conducted  for  the  sole  mutual  benefit  of  its 
members,  and  for  the  purpose  of  providing  a  fund,  by  their  joint 
contribution  made  up  from  stated  dues  from  such  members,  out  of 
which  special  amounts  were  to  be  paid  upon  the  death  of  members 
occurring,  such  payments  to  be  made  to  their  designated  bene- 
ficiaries, was  held  not  to  be  such  a  benevolent  association  within 
the  meaning  of  the  Kansas  laws,  as  entitles  it  to  have  its  property 
exempted  from  taxation. 

National  Council  K.  &  L.  of  Security  vs.  Philliiis.   December.  1901, 
63   Kansas   799;    66   Pacific  1011. 

Funds  Invested  for  an  Income  Subject  to  Taxation. 

Funds  belonging  to  a  charitaltle  or  benevolent  society  which  are 
invested  by  it  for  the  purpose  of  deriving  an  income  therefrom,  are 
held  not  to  be  exempt  from  the  burden  of  taxation. 

National   Council  K.  &  L.  of  Security  vs.   Phillips.  December,  1901, 
63  Kansas  809:    66  Pacific  1014. 


THE    STATE    OF    KANSAS  321 

Service  of  Suits  upon  Commissioner. 

The  fact  that  a  foreign  life  insurance  company  had  at  one  time 
transacted  business  in  a  State  under  a  license,  issued  by  the  super- 
intendent of  insurance,  and  that  it  had  filed  in  his  office  as  required 
by  the  statute  its  "authorized  consent,  irrevocable"  to  the  insti- 
tution of  suits  against  it  in  the  courts  of  said  State  and  the  issuance 
of  summons  against  it  directed  to  the  superintendent  of  insurance, 
was  held  not  to  subject  it  to  suit  in  said  State  on  a  policy  of  insur- 
ance wholly  executed  in  another  State,  if,  prior  to  the  issuance  of 
such  policy,  it  had  withdrawn  or  been  expelled  from  the  first  State 
mentioned  and  entirely  ceased  to  do  business  therein. 

Mutual  Reserve  Fund  Life  Assn.  vs.  Boyer,  June  9th,  1900,  62  Kansas 
31;    61  Pac.  387. 

Time  Within  Which  Suit  Must  be  Brought — After-enacted  Laws. 

A  benefit  certificate  issued  by  a  fraternal  society  provided  that 
no  suit  brought  thereon  should  be  enforced  unless  such  suit  should  be 
brought  within  one  year  from  the  death  of  the  member  to  whom  the 
certificate  was  issued.  In  an  action  upon  such  certificate  in  which 
the  petition  was  filed  before  the  expiration  of  the  year,  but  summons 
was  not  issued  and  served  until  after  the  expiration  of  the  year,  it 
was  held  that  the  suit  had  not  been  brought  within  the  time  pre- 
scribed by  the  terms  of  the  certificate,  and  it  was  also  held  in  the 
same  case  that  a  subsequently  enacted  by-law  made  after  the  issuance 
of  the  said  certificate,  and  which  provided  a  new  form  of  certificate 
in  which  the  time  of  bringing  suit  thereon  was  extended  could  not 
be  followed  in  this  State  without  it  appeared  that  the  by-law  was 
.  intended  to  be  retroactive. 

Modern  Woodmen   of  America  vs.   Bauersfeld.   December  Sth.   1900, 
62  Kansas  340;  62  Pacific  1,012. 

Courts  Take  Judicial  Notice  of  Mortality  Tables. 

The  Supreme  Court  of  Kansas  held  that  it  would  take  judicial 
cognizance  of  the  tables  of  life  expectancy  and  employed  the  follow- 
ing language  in  passing  upon  this  question: 
21 


322  fbaternaIj  society  law 

"At  the  trial  plaintifif  read  the  tables  of  life  expectancy  as  pub- 
lished in  the  Encyclopedia  Britannica,  to  which  objection  was  made. 
"We  are  quite  well  satisfied  that  courts  are  entitled  to  take  judicial 
notice  of  the  standard  tables  of  life  expectancy  and  may  allow  them 
to  be  read  in  evidence  to  the  jury.  Erb  vs.  Propritz,  59  Kansas  264, 
52  Pacific  87 ;  Donaldson  vs.  Mississii)pi  &  Missouri  Railroad  Com- 
pany, IS  Iowa  280;  Seheffler  vs.  Minneapolis  &  St.  Louis  Railway 
Company.  32  Minnesota  518,  21  N.  W.  711 ;  Abell  vs.  Pennsylvania 
Mutual  Life  Insurance  Company,  18  West  Virginia  400;  Gordon, 
Rankin  &  Company  vs.  Tweedy.  74  Alabama  232.  These  tables  con- 
sist of  summarized  statistical  information  on  a  matter  of  general 
interest.  They  are,  therefore,  impartial  and  disinterested,  and  they 
are  so  nearly  in  the  nature  of  exact  science  or  mathematical  demon- 
stration as  to  render  them  creditable  and  valuable.  Consequently 
the  imiform  practice  of  the  courts  is  to  receive  them  in  evidence.  If 
the  court  judicially  know  the  standard  tables  of  life's  expectancy 
when  presented  to  their  observation,  they  may  assure  their  knowl- 
edge by  reference  to  publications  containing  them.  The  only  easily 
accessible  authentic  publications  of  such  tables  is  to  be  found  in 
the  standard  encyclopedias  like  the  Brittanica.  The  courts  recog- 
nize such  publications  as  being-  authentic  and  in  general  use,  and, 
therefore,  thej-  receive  them  in  evidence  as  to  matters  contained 
therein  of  which  judicial  knowledge  is  possessed. ' ' 

A.  T.  &  S.  F.  Ry.  Co.  vs.  Ryan,  April  6th,  1901,  62  Kansas  682,  at  p. 
690;  64  Pac.  603. 

Pleading  Offer  of  Compromise  Admits  Something  Due. 

An  offer  was  made  by  the  insurance  company  to  compromise  a 
claim  made  against  it  for  a  sum  smaller  tlian  the  amount  claimed, 
and  an  averment  of  the  same  made  in  the  answer  of  the  insurance 
company  to  the  suit;  was  held  to  waive  a  defense  that  the  insured 
was  not  entitled  to  anything  under  the  claim  made. 

The  Wilfley  Casualty  Co.  vs.  Sheppard,  January  6th,  1900,  61  Kansas 
351;   .59  Pacific  651. 


TBE    STATE    OF   KANSAS  323 

Suicide — Sane  or  Insane. 

It  is  coiii|)('li'iit  for  piirtics  in  coiiti-iicting  as  to  life  insurance  to 
provide  tluit  self-destruction  by  the  insured,  whether  sane  or  insane, 
shall  avoid  the  contract,  and  a  provision  to  this  effect  in  a  contract 
covers  a  case  of  intentional  self-destruction  b\-  one  who  understood 
the  physical  luiture  and  consequences  of  an  act  which  caused  his 
death,  although  his  mind  was  so  far  impaired  that  he  was  not  con- 
scious of  the  moral  quality  or  the  consequences  of  such  act.  The 
facts  in  this  case  were  stipulated  and  were  stated  by  the  court  in  the 
following  language : 

"The  agreed  facts  showed  a  ease  of  intentional  self-destruction, 
and  that  while  he  did  not  understand  the  moral  character  nf  his 
acts,  he  had  sufficient  intelligence  as  to  what  the  physical  end  and 
consequences  of  the  same  would  be."  The  court  further  said  "We 
are  not  required  to  determine  the  effect  of  such  an  exception  where 
the  insured  was  wholly  bereft  of  reason  that  he  did  not  understand 
the  natural  result  of  his  acts,  nor  what  woi;ld  be  the  effect,  if,  in 
addition  to  this  exception,  the  contract  contained  a  clause  making 
it  incontestable  after  a  stated  time  and  the  death  had  occurred  after 
that  time." 

Hart   vs.    Modern   Woodmen    of    Amerira   and    Hart   vs.    Knights   of 
the  Maccabees,  July  Sth,  1899,  60  Kansas  67S. 

Disappearance — Proof  of  Death — Not  Furnished  in  Time. 

The  plaintiffs  who  were  beneficiaries  named  in  a  certificate  of 
membershii)  in  a  fraternal  soeiet.v  alleged  and  established  the  death 
of  a  member  as  having  occurred  in  1883,  by  evidence  that  he  dis- 
appeared from  all  his  friends  and  acquaintances  at  that  time  and 
that  he  had  since  never  been  heard  from.  Proof  of  his  death,  which 
by  the  terms  of  the  certificate  was  a  condition  precedent  to  any 
liability  of  the  society  to  pay,  was  not  furnished  until  Jiily,  1894. 
It  was  held  that  this  was  an  unreasonable  delay,  and  that  the  statute 
of  limitation  barred  the  action.  The  courts  held  that  the  proof  of 
death  should  have  been  made  in  1889. 


Harrison  vs.   Masonic  Mutual   Benefit  Assn..  January,  189S,  59  Kan- 
sas 29. 


324  FRATERNAL    SOCIETY    LAW 

An  Unincorporated  Subordinate  Lodge  Not  a  Partnership. 

The  fiuaucial  officer  of  a  local  lodge  of  the  Knights  of  Pythias  was 
charged  with  having  embezzled  the  funds  of  the  lodge.  He  claimed 
that  the  local  lodge  was  a  partnership,  that  the  taking  of  its  funds 
was  not  embezzlement,  but  merely  conversion  of  partnership  funds 
by  one  partner.  The  coui-t  held  that  the  local  lodge  was  not  a  part- 
nership, that  it  was  a  fraternal  society,  and  that  fraternal  societies 
are  not  partnerships. 

State  of  Kansas  vs.  Campbell,  March  5th,  1898,  59  Kansas  246. 

Provisions  Limiting  Time  for  Suing. 

The  contract  of  insurance  provided  that  no  "Legal  proceedings 
for  recovery  hereunder  shall  not  be  brought  iintil  after  three  months 
from  the  date  of  filing  proof  at  the  company's  home  office,  or  brought 
at  all  unless  begun  within  six  months  from  the  time  when  the  right 
of  action  shall  accrue."     This  provision  was  con.strued  and  upheld. 

Provident  Standard  Life  &  Accident  Assn.  vs.  Davis,  July  8th,  1S9S, 
59  Kansas  521. 

Resort  to  Civil  Coiu-ts  Before  Exhausting  Remedies  in  Society. 

The  general  laws  of  a  fraternal  society,  which,  by  the  use  of 
permissive  words,  allow  an  appeal  from  the  decision  of  an  officer 
of  the  society  to  whom  the  claimant  of  a  death  or  disability  benefit 
is  required  in  the  first  instance  to  prosecute  his  claim,  but  which 
do  not  obligate  liim  to  appeal  from  an  adverse  decision  as  a  condition 
precedent  to  an  action  upon  his  certificate,  was  itpheld,  and  to  pre- 
clude the  claimant  from  maintaining  an  action  in  the  courts  for  the 
recovery  of  his  loss,  without  his  having  taken  such  appeal.  In 
this  case  at  bar  the  entire  doctrine  of  the  right  of  resort  to 
civil  courts  without  exhausting  the  judicial  procedure  ju'ovided  in 
fraternal  societies,  as  discussed  in  the  case  of  Order  of  Select 
Friends  vs.  Raymond,  57  Kansas  647,  was  followed. 

Supreme  Lodge  Order   Select   Friends   vs.   Dey,   June   5th,   1S97,   58 
Kansas,  283. 


THE    STATE    OF    KANSAS  3'25 

Benefit  Funds  Exempt  From  Creditor's  Claims. 

The  (>x('inpti(iii  l:nvs  of  the  Slali'  "f  K:nis;is  wci'c  held  to  extend 
to  the  funds  eolleeted  \>y  liciiclieiaries  n])()n  certificates  issued  by 
fraternal  societies,  the  proceeds  of  wliieli  were  tk'ixisited  in  banks: 
the  Court  said  that  same  could  not  be  reached  by  process  of  garnish- 
ment by  a  creditor  to  enforce  payment  of  a  judgment  against  a 
beneficiary. 

Emmert  vs.  Schmidt,  January,  1902,  65  Kansas,  31;  68  Pac.  1072. 

Immaterial  Answers  Made  Material  by  Warranty. 

When,  in  a  contract  of  insurance,  the  application  of  the  insured 
is  made  the  basis  for.  and  a  part  of  the  contract,  and  where  it  is 
stipulated  and  warranted  that  the  answers  of  the  applicant  to  ques- 
tions propounded  in  the  application  are  literally  true,  and  it  is  also 
stipulated  that  if  any  such  answers  be  found  not  literally  true,  the 
contract  shall  become  absolutely  null  and  void,  the  validity  of  the 
contract  depends  on  the  truthfulness  of  the  answers,  and  not  on  the 
materiality  of  the  answers.  The  Court  held  that  the  parties  having 
made  the  answers  of  the  insured  material  that  the  contract  is 
avoided,  if  such  answers  be  found  untrue,  whether  they  would  have 
otherwise  been  material  was  immaterial. 

Hoover  vs.  Royal  Neighbors  of  America,  July.  1902,  65  Kansas,  616; 
70  Pac.  595. 

Right  to  Increase  Payments  and  to  Readjust  Rates. 

Where  a  fraternal  society  has  issued  to  a  member  a  benefit  cer- 
tificate, which  is  so  defective  in  its  recitals  as  to  make  reference  to 
the  laws  of  the  society  necessary  in  order  tt)  understand  the  exact 
obligations  and  duties  of  each  of  the  parties,  such  laws  are  a  part 
of  the  agreement,  and  where  the  certificate  and  by-laws  make  it 
apparent  that  the  member  agreed  to  be  bound  by  subsequently 
enacted  laws,  he  is  bound  by  a  new  law  which  changes  and  increases 
his  rate  of  monthly  assessments  if  it  be  reasonable  and  necessary  to 
the  accomplishment  of  the  objects  of  the  society. 


326  FRATERNAL     SOCIETY    LAW 

Miller  vs.  National  Council  K.  &  L.  of  Security,  May,  1904,  69  Kan- 
sas  234.   76   Pacific   830. 

Meetings  Held  in  Foreign  State. 

Where  a  statute  under  which  a  fraternal  societ.y  is  corporated  au- 
thorized the  society  so  to  amend  or  alter  its  by-laws  as  to  provide 
for  holding  meetings  of  its  legislative  body  in  any  State  or  territory 
\vhere  it  has  subordinate  lodges,  and  where  its  governing  body  at  a 
regular  meeting,  has  adopted  a  resolution  to  meet  next  at  a  place 
other  than  that  stated  in  the  by-laws,  in  another  State,  the  meeting 
so  held  under  such  resolution,  if  otherwise  regular,  is  authorized  and 
its  proceedings  valid. 

Miller  vs,   Nat.   Council  K.  and  L.  of  Security,  May,   1904,   69  Kas. 
234,  76  Pacific  830. 

Beneficiaries  Limited  to  the  Statutory  Classes. 

The  Kansas  fraternal  beneficiary  act  of  1899  provides  among 
other  things  that  "The  payment  of  death  benefits  of  such  an  asso- 
ciation shall  be  to  the  families,  heirs,  blood  relatives,  affianced  hus- 
band or  affianced  wife  of,  or  to  persons  depending  upon,  the  mem- 
ber thereof."  The  Supreme  Court  in  passing  upon  this  provision  of 
law  held  that  persons  other  than  those  designated  in  the  statute 
have  no  insurable  interest  in  the  life  of  a  member,  and  cannot 
legally  be  made  beneficiaries  or  receive  death  benefits  from  such 
societies.  It* was  further  held  that  a  person  not  included  in  such 
class  cannot  indirectly  become  a  beneficiary  b.v  an  agreement  be- 
tween the  assured  and  one  authorized  by  law  to  receive  the  benefits 
in  which  the  latter  agreed  to  act  as  trustee  for  the  person  having 
no  insurable  interest. 

Gillam  vs.  Dale,  May,  1904,  69  Kas.  362;  76  Pacific  861. 

Change  of  Beneficiary — Fraudulent  Inducements. 

A  certificate  was  issued  b.v  the  Ancient  Order  of  United  Workmen, 
payable  to  a  member's  child  and  afterward  a  change  was  made  and 
the  certificate  changed  to  the  brother  of  the  member.     After  the 


THE    STATE    OF   KANSAS  327 

death  of  the  member  the  minor  child  of  the  member  formerly  named 
as  the  beneficiary,  made  claim  for  the  amoiint  of  the  benefit,  and  the 
society  refused  to  pay  any  one.  The  brother  named  in  the  certificate 
then  brought  suit  and  made  the  minor  child  party  defendant.  TlTe 
minor  child  set  up  that  the  brother  of  the  deceased,  by  fraud  in- 
duced the  assured  when  enfeebled  in  body  by  disease  and  weakened 
in  mind  from  the  excessive  use  of  opiates  to  change  the  beneficiary 
in  the  certificate  from  it  to  the  brother.  The  Court  held  that  where 
there  was  no  testimony  tending  to  show  the  fraudulent  inducements, 
mere  evidence  that  it  was  unnatural  and  improbable  that  a  father 
would  change  the  beneficiary  frcmi  his  infant  daughter  to  a  grown 
brother,  that  siich  evidence  alone  was  not  to  be  taken  as  fraudulent 
inducement. 

Broderick  vs.  Broderick,  July.  1904,  69  Kansas  679 ;  77  Pac.  534. 

After  Enacted  Laws  in  Mutual  Society. 

For  the  facts  in  a  case  where  a  member  joining  a  mutual  life 
insurance  company  agreed  in  his  application  to  be  bound  by  after- 
enacted  by-laws,  was  held  not  bound  by  a  certain  amendment  sub- 
sequently adopted,  see  the  following: 

Boman  vs.  Bankers'  Union  of  the  World,  July,  1907,  Supreme  Court 
of  Kansas,  91  Pac.  49. 

Admissions  by  Beneficiary  in  Proofs  of  Death. 

The  statements  made  by  a  physician  in  the  execution  of  death 
proof  blanks,  furnished  by  the  beneficiary,  and  which  were  obtained 
from  the  society,  which  statements  related  to  the  condition  of  health 
of  the  deceased  member  for  some  months  prior  to  his  death,  were 
held  not  to  be  regarded  as  admissions  of  the  beneficiary  made  in 
connection  with  furnishing  proofs  of  death. 

Triple  Tie  Benefit  Assn.  vs.  Wheatley,  July,  1907,  Supreme  Court  of 
Kansas,  91  Pac.  59. 

Conditions  Precedent  to  Liability. 

The  laws  of  a  society  provided  that  liability  should  not  begin, 


328  FRATERNAL    SOCIETY    LAW 

until  after  the  certificate  had  been  issued  and  signed  by  the  proper 
officials  of  the  supreme  and  local  councils,  and  the  conditions  of  the 
certificate  accepted  by  the  member  in  writing,  endorsed  upon  the 
certificate,  and  it  was  held,  notwithstanding  the  payment  of  a 
monthly  assessment,  liability  did  not  begin  until  the  conditions 
had  been  met  and  application  of  the  payment  cannot  be  made  until 
thereafter. 

Triple   Tie   Benefit  Association  vs.  Wood,  February,   1906,  Supreme 
Court  of  Kansas,  84  Pac.  565. 

Public  Charged  With  Notice  of  Corporate  Powers. 

Every  person  dealing  with  a  corporation  or  with  its  obligations 
is  bound  to  take  notice  of  the  power  vested  in  such  corporations  and 
of  the  purposes  of  its  creation. 

Scott  vs.  Bankers'  Union  of  the  World,  May,   1906,  Supreme  Court 
of  Kansas,  85  Pac.  604. 

Self  Executing  Forfeiture  Provisions. 

As  an  example  of  self  executing  provisions  of  fraternal  contracts, 
the  following  which  was  so  held  to  be  self  executing  is  given:  "If 
the  member  shall  become  so  far  intemperate  in  the  use  of  alcoholic 
drinks,  or  the  use  of  drugs,  to  such  an  extent  as  to  permanently 
impair  his  health,  or  to  pi-oduce  delirium  tremens,  then  -this  certifi- 
cate shall  be  null  and  void  and  of  no  eifect  ,and  all  moneys  which 
shall  have  been  paid,  and  all  rights  and  benefits  which  may  have 
accrued  on  account  of  this  certificate  shall  be  absolutely  forfeited." 

Modern  Woodmen  of  America  vs.  Breckenridge,  March,  1907,  Supreme 
Court  of  Kansas,  89  Pac.  661. 

Waiver  of  Laws  by  Local  Lodge. 

When  a  subordinate  lodge  has  the  power  to  receive  members  and 
discipline  and  expel  them  for  violating  the  by-laws  of  the  society, 
and  it  possesses  knowledge  that  a  member  has  done  acts  which 
forfeit  his  benefit  certificate,  and  it  failed  to  act  upon  such  conduct 


THE   STATE   OF  KANSAS  329 

of  the  member,  it  is  held  that  the  society  has  waived  the  right  to 
insist  upon  forfeiture  by  continuing  to  receive  the  delinquent  mem- 
ber's assessment  up  to  the  time  of  his  death,  and  that  the  society 
is  estopped  from  assertiug  the  forfeiture.  A  by-law  was  called  to 
the  attention  of  the  court,  which  prohibited  the  subordinate  lodge 
from  waiving  any  of  the  provisions  of  the  laws  of  the  society,  but 
the  court  said  that  this  by-law  had  reference  only  to  contractural 
waivers,  and  had  no  application  to  a  waiver  by  operation  resulting 
from  subsequent  acts. 

Modern  Woodmen  of  America  vs.  Breckenridge,  March.  1907,  Supreme 
Court  of  Kansas,  89  Pac.  GGl. 

Venue  of  Suits  Versus  Societies. 

An  act  authorizing  the  incorporation  and  providing  for  the  regu- 
lation of  fraternal  societies,  was  held  not  to  fix  the  venue  of  actions 
brouglit  against  fraternal  societies,  and  that  such  actions 
might  be  brought  in  any  county  in  the  State  and  process  served 
on  the  superintendent  of  insurance. 

Loyal  Mystic  Legion  of  America  vs.  Brewer,  May,  1907,   Supreme 
Court  of  Kansas,  90  Pac.  247. 

Courts  Do  Not  Take  Judicial  Notice  of  Foreign  Statutes. 

The  courts  of  Kansas  do  not  take  judicial  notice  of  the  statutes 
of  other  States,  and  where  such  statutes  become  material  they  must 
be  pleaded  and  proved  as  other  material  facts. 

Loyal   Mystic   Legion   of   America   vs.   Brewer,   May,   1907.   Supreme 
Court  of  Kansas.  90  Pac.  247. 


330  FRATERNAL    SOCIETY    LAW 


THE 

STATE   OF   KENTUCKY. 

CHAPTER  18. 

The  State  of  Kentucky  has  no  fraternal  society  code.  Tlie  couri 
of  appeals  of  that  commonwealth  having  held  that  Section  679  of 
the  General  Statutes  applied  to  fraternal  societies,  the  legislature 
in  1906  amended  said  section  so  as  to  exempt  such  societies  from 
same  by  an  act  which  became  a  law  March  24.  1906,  as  follows: 

"Section  six  hundred  and  seventy-nine  of  subdivision  three, 
article  four,  chapter  thirty-two  of  the  Kentucky  statutes,  to  be 
amended  by  adding  thereto  the  following  words:  'But  the  pro- 
visions of  this  section  and  of  this  subdivision  shall  not  apply  to 
secret  or  fraternal  societies,  lodges  or  councils,  which  are  under 
the  supervision  of  a  grand  or  supreme  body  and  secure  members 
through  the  lodge  system  exclusively,  and  pay  no  commission,  and 
employ  no  agents,  except  in  the  organization  and  supervision  of 
the  work  or  local  subordinate  lodges  or  councils,'  so  that  section 
six  hundred  and  seventy-nine  of  subdivision  three,  article  four, 
chapter  thirty-two,  of  the  Kentucky  statutes,  when  amended  shall 
read  as  follows: 

"All  policies  or  certificates  hereafter  issued  to  persons  within  the 
commonwealth  by  corporations  transacting  business  therein,  under 
this  law,  which  policies  or  certificates  contain  any  reference  to  the 
application  of  the  insured,  or  the  constitution,  by-laws  or  other  rules 
of  the  corporation,  either  as  forming  part  of  the  policy  or  contract 
between  the  parties  thereto  or  having  any  bearing  on  said  contract, 
shall  contain  or  have  attached  to  said  policy  or  certificate  a  correct 
copy  of  the  application  as  sigiied  by  the  applicant,  and  the  portion 
of  the  constitution,  bv-laws,  or  other  rules  referred  to ;  and  unless 


7 


THE    STATE    OF    KENTUCKY  331 

SO  attached  and  aceompanyiiig  the  policy,  no  such  aj)i)lieation,  con- 
stitution, l)y-la\\s  (ir  other  rules  shall  he  received  as  evidence  in 
any  controversy  between  the  parties  to  or  interested  in  said  policy 
or  certificate,  and  shall  not  he  considered  a  jiart  of  the  policy  or  of 
the  contract  between  such  parties.  '1  he  said  poliey  or  certificate, 
application,  constitution,  by-laws  nr  othei'  rules  shall  be  plainly 
printed,  and  no  portion  thereof  shall  be  in  type  smaller  than  brevier : 
Provided,  however,  that  nothing  in  this  section  shall  be  constnu'd 
as  applying  to  health  certificates  or  any  constitutional  receipts,  or 
other  evidences  used  in  reinstatement  of  a  jiolicy  or  certificate.  But 
the  provisions  of  this  section  of  this  subdivision  shall  not  apply  to 
secret  or  fraternal  societies,  lodges  or  councils,  Avhich  are  under  the 
supervision  of  a  grand  or  supreme  body,  and  secure  members 
through  the  lodge  system  exclusively,  and  pay  no  commission  nor 
employ  any  agents,  except  in  the  organization  and  supervision  of 
the  work  of  local  subordinate  lodges  or  councils." 

—Kentucky  Laws.  1906. 

Misstatements  Regarding  Habits. 

Where  it  is  pleaded  that  the  insured  made  false  statements  in  his 
application  for  insurance  as  to  his  habits  of  drinking  whisky,  the 
court  should  have  set  out  in  an  instruction  the  qiiestions  and 
answers  contained  in  the  application  with  reference  thereto,  and 
should  have  told  the  jury  that  they  should  find  for  the  plaintiffs  if 
the  answers  were  substantially  true,  but  otherwise  they  should  find 
•for  the  defendant,  although  there  was  no  intention  to  mislead  or 
deceive  the  company,  and  also  should  have  told  the  .jury  that  the 
answers  were  not  substantially  true,  if  the  assured  drank  whisky 
materially  more  than  as  stated. 

Providence    Savings   Life    Assurance    Co.    vs.    Dees,    January,    1905, 
120  Kentucky  2S5. 

Statutes  Limiting  Time  to  Sue, 

A  provision  in  a  life  insurance  contract  to  the  effect  that  no  suit 
shall  be  maintained  thereon  unless  begun  within  one  .vear  from  the 
death  of  the  insured,  is  void,  as  in  contravention  of  publfe  policy; 


332  FRATEUyAL     SOCIETY    LAW 

because  the  statutes  of  Kentucky  prescribe  a  period  of  fifteeeu  years 
for  bringing  actions  on  such  contracts. 

Union  Central  Lite  Ins,   Co.  vs.   Spinlcs,   September,   1904,   119  Ken- 
tucky 261. 

Time  When  Liability  Begins  Under  Policy. 

A  provision  in  an  insurance  contract  to  the  effect  that  it  shall 
not  take  effect  unless  applicant  be  alive  and  in  sound  health  when 
the  policy  is  delivered,  was  held  to  refer  solely  to  the  change  in 
condition  from  that  existing-  from  the  date  of  the  application  and 
medical  examination,  and  that  "sound  health"  is  co-ordinate  with 
the  "alive"  both  in  logical  and  grammatical  construction. 

Metropolitan  Lite  In.  Co.  vs.  Moore,  January,  1904.  117  Kentucky  651. 

Pleading  Return  of  Premium  on  Void  Contract. 

It  is  elementary  that  an  insurance  company  cannot  collect  and 
retain  the  premium,  .md  claim  that  there  was  no  insurance.  The 
defendant  will  not  be  permitted  to  say  that  the  policy  was  never 
binding  until  it  shall  pay  back  or  tender  back  the  premium  collected, 
and  this  must  apjiear  in  the  pleadings. 

Metropolitan  Life  In.  Co.  vs.  Moore,  .lanuary.  1904.  117  Kentucky  (i.51. 

Contract  Delivered  Must  Contain  Complete  Exhibit  of  All  Parts  Re- 
ferred to  or  Relied  on. 

In  construiug  Section  679  Kentucky  Statutes.  1903,  which  pro- 
vides that  all  policies  issued  to  persons  within  the  commonwealth 
by  corporations  transacting  business  therein,  which  contain  only 
reference  to  the  application  of  the  insured  or  the  by-laws,  or  to  the 
rules  of  the  corporation  having  any  bearing  on  the  contracts,  shall 
also  contain  or  have  attached  to  tlie  contract  a  correct  copy  of  the 
portiosis  of  the  by-laws  referred  to,  and  tuiless  so  attached,  no  such 
by-laws  or  application  shall  be  received  in  evidence  in  any  contro- 
versy between  the  parties  interested,  was  held  to  apply  in  the  case 
where  a  (-ei't  ilicate  was  issiu'd  before  tlie  enactment  of  sucli  statute, 


\ 


THE    STATJ.:!    OF    KENTUCKY  3;^,H 

and  Avhieh  contained  no  reference  to  suicide  of  the  member,  hut 
where  the  insurer  liad  subsequently  after  the  passage  of  the  act  and 
issuance  of  the  certificate  passed  a  by-law  providing  that  in  case 
the  member  died  by  bis  own  bands  the  company  should  be  liaiile 
only  for  a  i)roi)ortioiiate  amount  of  the  policy,  and  the  coiift  rx- 
■cluded  the  bydaw  in  question,  because  a  copy  of  it  liad  not  brcu 
attached  to  the  certificate.  The  legislature  has  subsetpieiit  to  this 
decision  amended  this  section  670. 

HunziUer  vs.  Supreme  Lodge  K.  of  P.,  January.  1904,  117  Kentiuky 
418. 

Suicide  Provided  Against  by  Implication  and  Also  is  Against  Public 
Policy. 

Every  contract  of  life  insui-.-mee  nmst  be  construed  to  contain 
the  implied  condition  that  the  insured  will  not  intentionally  termi- 
nate his  life,  but  that  the  insurer  shall  have  the  benefit  of  the 
chances  of  its  continuance  until  terminated  in  thi>  luitural,  ordinary 
course  of  events.  Tt  is  upon  these  chances  that  the  premium  is 
calculated  and  the  contract  founded;  hence,  the  suicide  of  the  in- 
sured operates  as  fraud  upon  the  insurer,  and  especially  is  this  so 
when  the  insurance  is  taken  out  in  contemplation  of  the  act.  In  the 
second  place,  the  enforcement  of  the  contract  in  case  of  death  by 
suicide  is  opposed  to  public  policy.  If  the  contract  should  expressly 
include  death  from  this  cause,  the  provision,  even  if  not  prohibited 
by  statute,  would  be  contrary  to  public  policy  in  that  it  tempted  or 
encouraged  the  insured  to  commit  suicide ;  and  it  is  obvious  that 
the  court  will  not  imply  a  condititui  which,  if  expressed  in  the  i-on- 
tract,  would  render  it  void. 

Hunziker  vs.  Supreme  Lodge  K.  of  P..  January,  1904,  117  Kentucky 
41S. 

Suicide  While  Insane, 

As  the  act  of  an  insane  person  in  taking  his  own  life  cannot  be- 
a  fraud  upon  the  insurer,  no  reason  exists  why  it  should  invalidate 
the  policy.     If  tlie  insurance  comi)any  would  ))rotect  itself  against 


334  FRATERNAL    SOCIETY    LAW 

such  a  risk,  it  slioiild  so  provide  iu  its  policy,  otherwise  it  will  b'i 
liable. 

Hunziker  vs.  Supreme  Lodge  K.  of  P.,  January.  1904.  117  Kentucky 
41S. 

Circumstantial  Evidence  of  Suicide, 

Where  the  right  to  recover  turns  upon  the  question  as  to  whether 
the  insured  committed  suicide,  the  court  should  direct  a  verdict  for 
the  insurance  company,  where  the  evidence,  though  circumstantial, 
but  uncontradicted,  all  points  to  suicide. 

Aetna  Life  Ins.  Co.  vs.  Kaiser,  April,  1903,  115  Kentucky  539. 

Coroner 's  Inquest — Suicide, 

In  a  suit  upon  a  policy,  the  defense  interposed  was  suicide.  The 
coi-oner  who  had  conducted  the  inquest  was  allowed  to  testify,  and 
was  permitted  to  give  his  opinion  as  to  whether  the  insured's  death 
was  self-inflicted,  but  it  was  held  that  the  coroner's  opinion  and  the 
coroner's  inquest  findings  were  wholly  incompetent  under  the  I'ules 
of  evidence  in  this  State. 

Aetna  Life  Ins.  Co.  vs.  Kaiser,  April.  1903,  115  Kentucky  539. 

Entire  Contract  Required  to  be  Contained  in  Certificate. 

Section  679  Kentuckj'  Statutes  wliicli  requires  that  charters,  by- 
laws, etc.,  or  copies  thereof,  shall  be  attached  to  the  certificate  before 
it  can  be  treated  as  part  of  the  contract  and  used  in  evidence,  applies 
to  fraternal  societies.  This  section  of  the  statutes  has  been  subse- 
quently amended  so  that  it  does  not  longer  apply  to  such  societies. 

Supreme  Commandery  United  Order  of  the  Golden  Cross  vs.  Hughes, 
September,  1902,  114  Kentucky  175. 

No  Stipulation  Against  Suicide. 

A  certificate  issued  by  :i  fi'nti'i'iinl  society,  containing  no  stipnla- 


r: 


TBE    STATE    OF    KENTUCKY  335 

tions  as  to  suicide,  but,  declared  that  it  was  subject  to  the  laws  of 
the  order,  aud  in  the  laws  there  was  a  provision  aj^ainst  suicide,  it 
was  held  that  as  the  certificate  contained  no  stipulation  as  to  suicide, 
and  no  copy  of  the  laws  was  attached  to  the  certificate,  it  wms  not 
competent  to  show  under  the  laws  the  provision  against  suicide. 

Mooney    vs.    Ancient    Order    United    Workmen,    January,    1903,    114 
Kentucky  950, 

Suicide — Definition  of  Under  Sane  or  Insane  Clause. 

A  fraternal  benefit  certificate,  payable  to  a  designated  beneficiary, 
and  which  is  silent  on  the  subject  of  suicide,  becomes  void  if  the 
insured  commits  suicide  while  sane,  but  not  void  if  the  insured  com- 
mit suicide  when  insane ;  and  it  was  held  that  the  insured  was  in- 
sane at  the  time  he  committed  suicide  if  he  did  not  have  sufficient 
reason  to  know  what  he  was  doing,  and  to  distinguish  right  from 
wrong,  or  if  he  had  not  sufficient  will  power  to  govern  his  actions 
by  reason  of  some  insane  impulse  which  he  could  not  control. 

Mooney    vs.    Ancient   Order    United    Workmen,    January,    1903,    114 
Kentucky  950. 

Forfeiture  Ipso  Facto. 

Where  a  contract  of  insurance  provided  that  upon  the  violation  of 
its  conditions  that  it  would  be  void  "Without  action  on  the  part  of 
the  company  or  notification  to  the  insured  or  beneficiary,"  no  notice 
of  the  forfeiture  for  the  non-payment  of  premiums  is  necessary  to 
make  forfeiture  effective. 

Cretchfield  vs.  Union  Cent.  Life.  Ins.  Co.,  January,  1902,   113   Ken- 
tucky 53. 

Suicide  Sane  or  Insane — Erroneous  Instruction. 

A  contract  of  life  insurance  provided  that  if  the  member  should 
"Die  by  his  own  act,  sane  or  insane,"  that  there  should  be  no  re- 
covery, was  construed  by  the  court  to  the  effect  that  if  the  insured 
took  his  life  when  he  had  mind  enough  to  know  that  the  act  by 


336  FRATERNAL    .SOCIETY    LAW 

■which  he  did  so  would  probabl.v  result  iu  his  death,  and  he  com- 
mitted it  with  the  intention  that  it  should  do  so,  though  he  may  not 
from  mental  derangement  have  known  that  his  act  was  wrong,  and 
may  not  have  the  will  power  to  resist  the  insane  impulse ;  that 
it  was  error  to  instruct  the  jury  that  before  they  could  find  for  the 
defendant  they  must  believe  that  the  insured  possessed  sufficient 
will  power  at  the  time  to  refrain  from  taking  his  own  life. 

Manhattan  Life  Ins.  Co.  vs.  Beard.  January,  1902.  112  Kentucky  455. 

Absence  for  Seven  Years  of  Fugitive — Presumptions  of  Death. 

Section  1639,  Kentucky  Statutes,  provides  that,  "If  any  person 
who  shall  have  resided  in  this  State  go  from  and  do  not  return  to 
this  State  for  seven  successive  years,  he  shall  be  presumed  to  be 
dead  iu  any  case  wherein  his  death  shall  come  in  question,  unless 
proof  be  made  that  he  was  alive  within  that  time,"  applies  where 
the  person  leaving  the  State  is  absent  for  seven  successive  years 
after  he  last  was  heard  from ;  the  burden  being  then  thrown  on  the 
other  party  to  prove  that  the  person  is  alive.  It  was  further  held 
that  the  fact  that  the  person  who  had  been  thus  absent  from  the 
State  without  being  heard  from  for  seven  consecutive  years  is  a 
fugitive,  does  not  prevent  the  application  of  the  statute  as  a  matter 
of  law;  but  that  fact  was  held  to  be  admissible  to  rebut  the  pre- 
sumption of  death. 

Mutual   Benefit   Life    Ins.    Co.   vs.   Martin.   January,   1903,   lOS   Ken- 
tucky 11.  j/^  1 

Separate  Classes — Separate  Funds. 

A  inut\ial  society  had  two  classes  of  members,  and  by  law  these 
classes  were  required  to  be  kept  separate  and  distinct,  and  that 
neither  class  should  be  responsible  for  the  obligations  of  the  other 
class  and  that  their  funds  should  be  kept  separate.  The  court  held 
that  no  part  of  the  funds  of  one  class  should  be  used  to  pay  the 
losses  of  the  other. 

Allen  vs.  Thompson.  April,   1!miii.  ](IS  Kentucky  476. 


THE    STATE    OF    KI-:\TI  CKY  337 

Beneficiary — Surviving-  Widow — Dependents. 

Where  a  iiu'iiiher  (if  :i  rniti'rnnl  society  obtained  a  eo'tificate  pay- 
able to  his  wife,  iiamiiig  her  as  sueh  beiiefioiary,  and  after  lier  deatli 
lie  remarried  and  then  died  childb^ss,  leavinjs:  his  second  wife  sur- 
viving, but  never  having  obtained  a  new  certificate  or  changed  the 
l)eiieticiai-y,  it  was  held  Ilia1  llie  siii-viving  wil'e  was  entitled  to  the 
benefit  as  against  the  father  of  the  deceasetl.  and  to  the  exclusion  of 
the  member's  administrator;  the  court  holding  that  the  widow  was 
a  member  of  the  family  of  Ihe  ileceased,  while  the  father  was  not 
such,  and  there  being  a  provision  in  the  laws  of  the  society  limiting 
the  benefits  to  the  membei's  of  the  family  of.  oi-  to  dependents  of  the 
member,  and  further  provided  that  the  benefit  should  not  in  any 
event  be  liable  foi'  any  of  Ihe  debts  of  the  member.  This  construc- 
tion was  of  a  certificate  and  the  by-laws  of  The  Calholir  Knights  of 
Aiuerica. 

O'Neal  vs.   O'Neal,   Oct.   5tli.   1900,   109   Ky.  113. 

After-enacted  State  Statutes. 

A  luember  holding  a  certificate  in  the  American  Guild  died  iu 
1905,  and  suit  was  begun  upon  the  certificate  in  September  of  that 
year.  In  March,  1906,  the  General  Assemlily  ameinled  §  679  of  the 
Kentucky  statutes  1903,  by  excepting  from  its  operations,  fraternal 
societies. 

There  was  not  attached  to  the  certificate  sued,  a  copy  of  the  ap- 
plication or  by-laws,  and  the  society  relied  upon  the  exception  added 
to  the  statute  by  the  Genei'al  A.ssembly  in  1906.  The  Court  held 
that  the  amended  statute  did  not  apply  to  the  contract  in  suit,  and 
added  the  following:  "The  rights  of  the  parties  are  determined  by 
the  contract,  and  the  contract  under  the  statute  is  determined  by 
the  certificate.  The  statute  cannot  make  any  law  impairing  the 
obligation  of  a  contract,  and  when  the  insured  died,  the  rights  of 
the  beneficiary  attached,  arul  the  statute  could  not  thereafter,  if  it 
wished,  impair  in  any  way  the  contract  rights  of  the  beneficiary 
under  his  contract." 

It  was  further  held  in  the  same  case  that  S  679  did  not  merely 
22 


338  FRATERNAL    SOCIETY    LAW 

prescribe  a  rule  of  evidence,  but  determined  what  shonld  constitute 
the  contract  between  the  parties. 

American  Guild  vs.  Wyatt,  March,  1907,  Court  of  Appeals  of  Ken- 
tucky, 100  S.  W.  266. 


THE    STATE    OF    LOUISIANA  339 


THE 

STATE  OF  LOUISIANA 

CHAPTER  19. 

The  State  of  Louisiaii.i,,  l)y  an  act  approved  July  9,  1906,  enacted 
a  Fraternal  Society  Code.    The  act  is  as  follows: 

"An  Act  to  provide  for  the  organization,  admission  and  regulation  of 
associations  transacting  the  business  of  life,  accident,  sick  benefit, 
or  physical  disability  insurance  on  the  fraternal  plan,  and  to  fix 
penalties  for  the  violation  of  this  Act,  and  to  repeal  all  laws  in 
conflict  with  the  provisions  of  this  Act. 

Section  1.  Be  it  enacted  by  the  General  Assembly  of  the  State  of 
Louisiana,  That  any  corporation,  society,  order  or  voluntary  associa- 
tion Avithout  capital  stock,  organized  and  carried  on  solely  for  the 
mutual  benefit  of  its  members  and  their  beneficiaries,  and  not  for 
profit,  and  having  a  lodge  system  with  ritualistic  form  of  work  aud 
representative  form  of  government  and  which  shall  make  provisions 
for  the  pa.yment  of  death  benefits,  and  which  may  make  provisions 
for  the  payment  of  disability  benefits,  or  both,  provided  the  regular 
periodical  payments  by  members  shall  not  be  made  oftener  than  once 
per  month,  is  hercljy  deehired  to  be  a  frntornal  beneficiary  asso'cia- 
tiou. 

Section  2.  Be  it  further  enacted,  etc..  That  any  association  having 
a  supreme  governing  or  legislative  body  and  subordinate  lodges  or 
branches  by  whatever  name  known,  into  which  members  shall  be 
elected,  initiated  and  admittetl  in  accordance  with  its  comstitution, 


340  FliATERXAL    SOCIETY    LAW 

laws,  I'ules,  regulations  and  prescribed  ritualistic  ceremonies,  which 
subordinate  lodges  or  branches  shall  be  required  by  such  association 
to  hold  regular  stated  meetings  at  least  once  in  each  month,  shall  be 
deemed  to  l)e  operatint;'  under  the  lodge  system. 

Section  3.  Be  it  further  enacted,  etc.,  That  any  association  shall 
be  deemed  to  have  a  representative  form  of  government,  when  it 
shall  provide  in  its  constitution  and  laws  for  a  supreme  legislative 
or  governing  bodj',  composed  of  representatives  elected  either  by  the 
members  or  by  delegates  elected  bj^  the  members  through  a  delegate 
convention  system  together  with  such  other  members  as  may  be  pre- 
scribed by  its  constitution  and  laws,  provided  that  the  elective 
representatives  shall  constitute  a  majority  in  number  and  have  not 
less  than  a  majority  of  the  votes,  nor  less  than  the  votes  required  to 
amend  its  constitution  and  laws,  and  provided  further  that  the  meet- 
ings of  the  supreme  or  governing  body  and  the  election  of  officers, 
representatives  or  delegates  shall  be  held  as  often  as  once  in  four 
years.  The  members,  officers,  representatives  or  delegates  of  a  fra- 
ternal beneficiary  society  shall  not  vote  by  proxy. 

Section  4.  Be  it  further  enacted,  etc.,  That,  except  as  herein  pro- 
vided, such  association  shall  be  governed  by  this  Act  and  shall  be 
exempt  from  all  provisions  of  the  insurance  laws  of  this  State,  and 
no  law  hereafter  passed  shall  a])])]y  to  them,  unless  they  be  expressly 
designated  therein. 

Section  5.  ]?e  it  further  enacted,  etc..  That  every  association  trans- 
acting business  under  this  Act  shall  provide  for  the  payment  of 
death  benefits,  and  may  provide  for  the  payment  of  benefits  in  ease 
of  temporary'  oi"  permanent  physical  disability,  either  as  a  result  of 
disease,  accident  or  old  age,  provided  the  period  of  life,  at  which  the 
])aynient  of  lienefits  for  disability  on  account  of  old  age  shall  coni- 
nu^nce.  siiall  not  lie  under  seventy  years;  except  as  otherwise  pro- 
vided in  this  Act  no  association  shall  issue  or  offer,  or  promise  to 
issue,  any  contract  providing  for  the  payment  of  any  other  benefit, 
or  any  contract  which  does  not  provide  for  the  regular  payments  or 
assessments  during  the  entire  existence  of  the  contract. 

Section  G.  Be  it  further  enacted,  etc..  That  the  paynieut  of  death 
benefits  shall  be  confin(Hl  1o  1he  wife,  husliand.  family,  relatives  by 
blood,  marriage,  or  legal  adoption,  affianced  husband,  or  affianced 
wife,  or  to  a  person  or  persons  dependent  on  the  member. 


THE    STATE    OF    LOUISIANA  341 

Scctiiin  7.  lie  i1  riifthrr  rii:ictc(l,  r\f..  Thai  iKi  jissdc'iMlidii  sliall 
admit  to  l)ciu'tiL'ial  iiieiiiberslii[)  any  person  less  tluiii  sixteen  (Ki)  nor 
more  than  sixty  ((50)  years  of  age,  nor  any  person  who  Inis  not  been 
examined  by  a  legally  qualified  jtracticing  pliysieian,  and  whose  ex- 
amination has  not  been  a|ii)roved  by  the  snpervising  medical  author- 
ity of  the  association  as  j)i'ovided  by  the  laws  of  the  association. 

Section  8.  Be  it  further  enacted,  etc.,  Tliat  every  certificate  issued 
by  the  association  shall  s])ecify  the  maximum  amount  of  benefit  pro- 
vided by  the  contract,  and  shall  stipulate  that  the  funds  from  M'hich 
benefits  shall  be  paid  and  the  fmids  from  which  the  expenses  of  the 
association  shall  be  derived  from  periodical  or  other  payments  by  the 
members  of  tlie  association  and  arerclions  of  said  funds:  I'rovii.led, 
that  regular  periodical  payments  shall  not  lie  made  oftener  than  once 
per  month ;  and  every  such  association  shall  provide  in  its  constitu- 
tion or  laws,  and  in  its  certificates,  that  if  such  regular  payments  are 
insufficient  to  \>ay  all  matured  death  and  disability  claims  in  full, 
and  to  provide  for  the  creation  and  maintenance  of  the  funds  re- 
quired by  its  constitution  and  laws,  extra  assessments  or  other  pay- 
ments may  be  levied  upon  the  members  to  meet  such  deficiency.  It 
must  also  be  stipulated  in  the  certificate,  that  the  certificate,  the 
constitution  and  laws  of  the  association  and  the  application  for  mem- 
bersliip  and  medical  examination,  signed  by  the  applicant,  shall  con- 
stitute the  contract  between  the  association  and  the  member,  and 
copies  of  the  same  certified  by  the  secretary  of  the  association  or  cor- 
responding officer,  shall  be  received  in  evidence  of  the  terms  and  con- 
ditions of  the  contract;  and  any  changes,  additions  or  amendments 
to  said  charter  or  articles  of  association,  constitution  or  laws  duly 
made  or  enacted  subsequent  to  the  issuance  of  the  benefit  certificate 
shall  bind  the  member  and  his  beneficiaries,  and  shall  govern  and 
control  the  contract  in  all  respects  the  same  as  though  such  changes, 
additions  or  amendments  had  been  made  prior  to  and  were  in  force 
at  the  time  of  the  application  for  membership;  Provided,  how^ever, 
that  the  constitution  and  laws  of  any  such  association  shall  never  be 
amended  or  in  any  way  altered  except  by  the  supreme  legislative  or 
governing  body  in  a  regular  or  special  meeting  called  for  that  pur- 
pose after  written  notice  of  the  purpose  of  such  meeting  has  been 
given  every  member  of  the  association,  and  no  amendment  to  the 


342  FRATERNAL    SOCIETY    LAW 

constitution  and  laws  shall  in  anv  way  affect  the  rights  of  any  benefi- 
ciary  whose  claim  accrued  b.y  death  or  otherwise  prior  to  the  passage 
of  such  amendment. 

Section  9.  Be  it  further  enacted,  etc..  That  any  association  may 
create,  maintain,  invest,  disburse  and  apply  a  reserve,  emergency 
surplus  or  other  fund  in  accordance  with  its  constitution  and  laws 
for  the  purposes  specified  in  Section  5  of  this  Act.  Any  such  asso- 
ciation so  creating,  maintaining,  investing,  disbursing  or  applying 
any  such  reserve,  emergency  or  surplus  fund,  shall  not  be  held  to  be 
organized  or  carried  on  for  profit  within  the  intent  of  the  provisions 
of  Section  1  of  this  Act.  Such  funds  shall  be  held,  invested  and  dis- 
bursed for  the  use  and  benefit  of  the  as.sociation,  and  no  member  or 
beneficiarj^  shall  have  or  acquire  any  individual  rights  therein,  or  be 
entitled  to  an  apportionment  or  the  surrender  of  anj'  part  thereof. 

Section  10.  Be  it  further  enacted,  etc.,  That  any  association  may 
invest  its  funds  in  and  hold  real  estate  for  lodge  and  office  puiT^oses, 
and  any  real  estate  acquired  by  foreclosure  or  received  in  satisfac- 
tion of  loans,  and  may  sell  and  convey  the  same.  Any  such  associa- 
tion may  also  invest  its  funds  in  United  States,  State,  parish,  muni- 
cipal, levee,  or  drainage  district  bonds,  provided  that  such  bonds 
shall  be  a  direct  obligation  on  all  the  taxable  property  within  such 
municipality  or  district  and  the  net  indebtedness  of  such  munici- 
pality or  district  shall  not  exceed  five  (5)  per  centum  of  the  value  of 
all  taxable  property  therein  according  to  tli'e  last  valuation  for  taxa- 
tion preceding  the  issuance  of  said  bonds;  or  in  first  mortgages  or 
first  mortgage  bonds  upon  improved  real  estate  for  not  exceeding 
fifty  (50)  per  centum  of  the  actual  cash  value  thereof  at  the  time  of 
making  the  loan;  Provided,  however,  that  every  foreign  association 
shall  be  empowered  to  invest  its  funds  in  such  securities  as  may  be 
permitted  by  tlie  laws  of  the  State,  province  or  country  in  which  it 
is  organized. 

Section  11.  Be  it  further  enacted,  etc..  That  every  association  shall 
make  provision  in  its  constitution  and  laws  for  payment  by  members 
of  such  an  association,  which  provision  shall  state  the  purpose  of  the 
same  and  the  proportion  thereof  Avhich  may  be  used  for  expenses, 
and  no  part  of  the  money  collected  for  mortuary  or  disability  pur- 
poses and  no  part  of  the  reserve,  emergency  or  surplus  funds  or  the 


THE    STATE   OF   LOUISIANA  343 

net  accretions  of  either  or  any  of  said  funds,  shall  be  used  for  ex- 
penses, and  such  provision  must  also  be  printed  in  the  certificate, 
showing  the  proportion  of  the  payment  of  the  member  that  is  for 
mortuary  or  disability  purposes,  and  the  proportion  that  can  be  used 
for  expenses,  which  shall  be  binding  on  the  association. 

Section  12.  Be  it  further  enacted,  etc..  That  five  or  more  persons, 
citizens  of  this  State,  who  desire  to  form  a  fraternal  or  beneficiary 
association  as  defined  by  this  Act,  may  take  out  a  charter  in  the  way 
and  manner  provided  by  law,  in  which  shall  be  stated : 

First — The  proposed  corporate  name  of  the  association,  which 
shall  not  so  closely  resemble  the  name  of  any  association  or  insur- 
ance company  already  transacting  bvisiness  in  this  State  as  to  mis- 
lead the  public  or  to  lead  to  confusion. 

Second — The  purpose  for  which  it  is  foi-med — which  shall  not  in- 
clude more  liberal  powers  than  are  granted  by  this  Act,  provided 
that  any  lawful,  social,  intellectual,  educational,  moral  or  religious 
advantages  may  be  set  forth  among  the  purposes  of  the  association — 
and  the  mode  in  which  its  corporate  powers  are  to  be  exercised. 

Third — The  names,  residences  and  ofScial  title  of  all  the  officers, 
trustees,  directors,  or  other  persons  who  are  to  have  and  exercise  the 
general  control  and  management  of  the  affairs  and  funds  of  the  asso- 
ciation or  the  first  year  or  until  the  ensuing  election  at  which  all 
such  officers  shall  be  elected  by  the  supreme  legislative  or  governing 
body. 

Such  articles  of  association  and  duly  certified  copies  of  the  consti- 
tution and  laws,  rules  and  regulations,  and  copies  of  all  proposed 
forms  of  benefit  certificates,  applications  therefor  and  literature  to 
be  used  by  such  association,  and  a  bond  in  the  sum  of  five  thousand 
dollars,  with  sureties  approved  by  the  Secretary  of  State,  con- 
ditioned upon  the  return  of  the  advanced  payments,  as  provided  in 
this  section,  to  applicants,  if  the  organization  is  not  completed  in  one 
year,  or  after  such  further  jieriod,  not  exceeding  one  year,  as  may  be 
authorized  by  the  Secretary  of  State,  shall  be  fixed  with  the  Secre- 
tary of  State,  who  may  require  such  further  information  as  he  deems 
necessary,  and  if  the  purposes  of  the  association  conform  to  the  re- 
quirements of  this  Act  and  all  provisions  of  the  law  have  been  com- 
plied ^vith,  the  Secretary  of  State  shall  so  certify  and  retain  and 


344  FRATERNAL    SOCIETY    LAW 

keep  on  file  and  furnish  the  incorporators  a  preliminary  certificate 
authorizing  said  association  to  solicit  members  as  hereinafter  pro- 
vided. 

Upon  receipt  of  said  certificate  from  the  Secretary  of  State  said 
association  may  solicit  members  for  the  purpose  of  completing  its  or- 
ganization and  shall  collect  from  each  applicant  the  amount  of  not 
less  than  one  death  benefit  assessment  or  payment,  in  accordance 
with  its  tables  of  rates  as  provided  by  its  constitution  and  laws,  and 
shall  issue  to  each  such  applicant  a  receipt  for  the  amount  so 
collected. 

Bat  no  such  association  shall  incur  any  liability  other  than  for 
such  advance  payments,  nor  issue  any  benefit  certifieate,  nor  pay  or 
allow,  or  offer  a  promise  to  pay  or  allow  to  any  person  any  death  or 
disability  benefit  until  actual  bona  fide  applications  for  death  benefit 
certificates  have  been  secured  upon  at  least  five  hundred  lives  for  at 
least  one  thousand  dollars  each,  and  all  such  applicants  for  death 
benefits  shall  have  been  regidarly  examined  by  legally  qualified 
practicing  physicians  and  certificates  of  such  examinations  have  been 
duly  filed  and  approved  bj'  the  cliief  medical  examiner  of  such  asso- 
ciation, nor  until  there  shall  be  established  ten  subordinate  lodges  or 
branches  into  which  said  five  hundred  applicants  have  been  initiated, 
nor  until  there  has  been  submitted  to  the  Secretary  of  State  under 
oath  of  the  president  and  secretary  or  corresponding  officers  of  such 
association,  a  list  of  such  applicants,  giving  their  names,  addresses, 
date  examined,  date  approved,  date  initiated,  name  and  number  of 
the  subordinate  branch  of  which  each  applicant  is  a  member,  amount 
of  benefits  to  be  granted,  rate  of  i-egular  payments  or  assessments, 
which  shall  not  be  lower  for  death  benefits  than  those  required  by 
the  National  Fraternal  Congress  table  of  mortalit.v,  with  interest  at 
four  per  cent,  per  annum ;  nor  until  it  shall  have  been  shown  to  the 
Secretary-  of  State  by  the  sworn  statement  of  the  treasurer  or  cor- 
responding officer  of  such  association,  that  at  least  five  hundred  ap- 
plicants have  each  paid  in  cash  at  least  one  regular  monthly  pay- 
ment or  assessment  as  herein  provided  per  one  thousand  dbllars  of 
indemnity  to  l)e  effected,  which  payments  in  the  aggregate  shall 
amoiuit  1(1  ;it  least  twenty-five  hundred  dollars,  all  of  which  shall  be 
credited  to  the  nmrluary  uv  ilisaliility  fund  on  account  of  such  ap- 
plicants, and  nil  |iart  nf  whii'li  may  be  used  for  expenses. 


THE    STATE    OF    LOUISIANA  345 

Said  advanced  payments  shall  during  the  jx'riod  of  oi'ganization 
be  held  in  trust  for  and,  if  the  organization  is  not  complpted  within 
one  year  as  hereinafter  provided,  returned  to  said  ap])licant,s. 

The  Secretary  of  State  may  make  such  examination  and  require 
such  further  information  as  he  may  deem  advisable,  and  upon  pre- 
sentation of  satisfactory  evidence  that  the  association  has  complied 
with  all  the  provisions  of  the  law  he  shall  issue  to  such  association  a 
certificate  to  that  effect.  Such  certificate  shall  lie  prima  facie  evi- 
dence of  the  existence  of  such  association  at  the  date  of  such  certifi- 
cate. The  secretary  of  state  shall  cause  a  record  of  such  certificate  to 
be  made  and  a  certified  copy  of  such  record  may  be  given  in  evidence 
with  like  effect  as  the  original  certificate. 

No  preliminary  certificate  granted  under  the  provisions  of  this 
section  shall  be  valid  after  one  year  from  its  date,  or  after  such  fur- 
ther period,  n<jt  exceeding  one  year,  as  may  be  anlhoi-ized  by  the 
Secretary  of  State  upon  cause  shown,  unless  five  hundred  applicants 
herein  required  have  been  secured  and  the  organization  has  Been 
completed  as  herein  provided,  and  the  articles  of  association  and  all 
proceedings  thereimder  shall  become  null  and  void  in  one  year  from 
the  date  of  said  preliminary  certificate,  or  at  the  e^ipiration  of  said 
extended  period,  unless  such  association  shall  have  completed  its 
organization  and  commenced  business  as  herein  provided.  When 
any  domestic  association  shall  have  discontinued  business  for  the 
period  of  one  year,  its  charter  shall  become  null  and  void. 

Section  13.  Be  it  further  enacted,  etc..  That  any  domestic  or  fra- 
ternal association  within  the  definition  of  fraternal  associations  de- 
scribed in  this  Act,  now  engaged  in  transacting  business  in  this 
State,  may  exercise,  after  the  passage  of  this  Act.  all  of  the  rights 
conferred  thereby,  and  in  addition  thereto  may  exercise  all  of  the 
rights,  powers  and  privileges  now  exercised  or  possessed  by  it  under 
its  charter  or  articles  of  association  not  inconsistent  with  this  Act, 
or  it  may  be  reincorporated  hereunder.  But  no  such  association 
already  organized  shall  be  required  to  reincorporate  hereunder,  nor 
shall  it  be  required  to  adopt  the  rules  prescribed  herein  for  new  asso- 
ciations, in  order  to  avail  itself  of  the  privileges  of  this  Act. 

Section  14.  Be  it  further  enacted,- etc.,  That  no  domestic  associa- 
tion shall  transfer  its  membership  or  funds  to  any  association  not 


346  FRATERNAL    SOCIETY    LAW 

authorized  by  the  Secretary  of  State  to  transact  business  in  this 
State,  nor  shall  any  such  association  transfer  its  members  or 
funds  to  any  licensed  association,  unless  the  said  contract  to  transfer 
has  been  approved  by  a  tAvo-thirds  vote  of  the  members  of  the  su- 
preme body  of  the  association  whose  membership  is  proposed  to  be 
transferred ;  and  by  a  two-thirds  vote  of  the  trustees  or  board  having 
charge  of  the  association  proposing  to  take  such  membership. 

Section  15.  Be  it  further  enacted,  etc.,  That  foreign  fraternal 
associations  which  were  transacting  business  in  this  State  prior  to 
the  passage  of  this  Act  may  continue  such  bu.siuess  until  the  first 
day  of  April  next  succeeding  the  passage  of  this  Act,  and  the  author- 
ity' of  such  associations  to  do  bvisiness  in  this  State  may  thereafter 
be  renewed  annually,  as  hereinafter  provided,  but  in  all  cases  to 
terminate  on  the  first  day  of  the  siicceeding  April.  A  eertifieate 
from  the  Secretary  of  State  to  such  association  shall  be  prima  facie 
evidence  that  the  license  is  a  fraternal  beneficiary  association  withiu 
the  meaning  of  this  Act. 

Section  16.  Be  it  further  enacted,  etc..  That  no  foreign  fraternal 
association  shall  transact  any  business  in  this  State  without  a  cer- 
tificate from  the  Secretary  of  State.  Before  receiving  such  certifi- 
cate it  shall  file  with  the  Secretary  of  State  a  duly  certified  copy  of 
its  charter  or  articles  of  association ;  a  copy  of  its  constitution  and 
laws,  certified  by  its  secretary  or  corresponding  officer;  a  power  of 
attorney  to  the  Secretary  of  State  as  hereinafter  provided;  a  state- 
ment under  oath,  of  its  president  and  secretary,  or  corresponding 
officers,  in  the  form  required  by  the  Secretary  of  State,  duly  verified 
by  an  examination  made  by  the  supervising  insurance  official  of  its 
home  State,  of  the  business  for  the  preceding  year ;  a  copy  of  its  mem- 
bership contracts,  or  certificates,  which  must  show  that  benefits  are 
provided  for  by  assessments  upon  or  other  payments  by  the  persons 
holding  similar  membership  contracts  or  certificates,  and  shall  fur- 
nish the  Secretary  of  State  with  such  other  information  as  he  may 
deem  necessary  to  a  proper  exhibit  of  its  business  and  jilan  of  work- 
ing, and  if  he  finds  that  it  is  transacting' business  in  accordance  with 
the  provisions  of  this  Act.  that  its  assets  are  invested  in  accordance 
with  the  laws  of  the  State  where  it  is  organized,  and  that  it  has  the 
memliri-sliip  and  qnalitication  reqiiifi'd  <if  <l(iniestie  associatinns  or- 


THt:    STATE    OF    LOUISIANA  347 

yiiiiizcd  iiiidiT  this  Act,  lie  iiiiiy  license  such  associaticm  t(i  do  liiisi- 
ness  ill  this  State  until  the  fii'st  day  of  the  succcediti^''  Api'il,  and  sucli 
license  may  he  renewed  annually.  l)ut  in  all  eases  to  terminate  ou  the 
first  day  of  the  succeeding-  April. 

Hection  17.  He  it  further  enaetetl,  etc.,  That  no  license  shall  be 
issued  to  any  association  not  transacting  business  in  this  State  at  the 
time  of  the  i)assage  of  this  Act  which  collects  from  any  of  its  mem- 
bers assessments  or  payments  for  death  benefits  lower  than  those  re- 
quired by  the  Fraternal  Congress  Mortality  Table  of  1900,  with  in- 
terest at  four  per  cent,  per  annum. 

Section  18.  Be  it  further  enacted,  etc..  That  when  the  Secretary 
of  State  refuses  to  license  any  association,  or  revokes  its  authoi'ity 
to  do  business  in  this  State,  he  shall  reduce  his  ruling,  order  or  de- 
cision to  writing,  and  file  the  same  in  his  office,  and  shall  furnish  a 
copy  thereof,  together  with  a  statement  of  his  reasons,  to  the  officers 
of  the  association,  ujion  request.  Any  society  affected  by  any  such 
ruling,  order  or  decision,  .shall  have  the  right  to  appeal  to  any  court 
of  competent  jurisdiction  in  this  State,  by  filing  with  said  Secretarj' 
of  State  a  notice  of  such  aijjteal  in  writing,  .stating  specifically  to 
which  court  such  appeal  is  proposed  to  be  taken,  and  in  such  case 
said  Secretary  of  State  shall  forthwith,  and  within  ten  days  there- 
after, deliver  to  such  association  a  full  and  certified  transcript  of  all 
proceedings  had  before  him  in  such  matter,  including  all  applica- 
tions, together  with  all  orders,  rulings  and  decisions  had  thereon. 
And  on  such  transcript  being  filed  in  .said  court,  such  court  shall  be 
fully  possessed  of  said  action,  and  a  full  trial  on  the  merits  de  novo 
shall  be  had  thereon;  jirovided,  that  such  appeal  shall  be  filed  in 
such  court  within  forty  days  after  the  rendition  of  the  ruling,  order 
or  decision  appealed  from :  And  provided  further,  that  nothing  con- 
tained in  this  or  the  preceding  section  shall  be  taken  or  construed 
as  preventing  any  such  association  from  continuing  in  good  faith  all 
contracts  made  in  this  State  during  the  time  such  association  was 
legally  authorized  to  transact  business  herein,  and  provided  further, 
that  the  association  will  not  be  allowed  to  voluntarily  withdraw  from 
the  State  after  such  appeal  has  been  taken  nor  until  the  court  has 
rendered  its  decision  on  such  appeal. 

Section  If).  Be  it  further  enacted,  etc..  That  every  foreign  asso- 
ciation shall,  before  lieing  licensed,  appoint  in  writing  the  Secretai\v 


348  FRATERNAL    SOCIETY    LAW 

cf  State  and  his  successors  iu  office  to  be  its  true  and  lawful  at- 
torney, upon  whom  all  legal  process  in  any  action  or  proceeding 
against  it  shall  be  served,  and  in  such  writing  shall  agree  that  any 
lawful  process  against  it,  which  is  served  upon  said  attorney,  shall 
be  of  the  same  legal  force  and  validitj'  as  if  served  upon  the  associa- 
tion, and  that  the  authority  shall  continue  in  force  so  long  as  any 
liability  remains  outstanding  in  this  State. 

Copies  of  such  appointment,  certified  by  the  Secretary  of  State, 
shall  be  deemed  sufficient  evidence  thereof,  and  shall  be  admitted  in 
evidence  with  the  same  force  and  ei¥ect  as  the  original  thereof  might 
be  admitted.  Service  may  only  he  had  upon  such  attorney,  must  be 
made  in  duplicate  and  accompanied  by  the  fee  hereinafter  provided, 
and  shall  be  deemed  sufficient  service  upon  such  association,  pro- 
vided, however,  that  no  such  service  shall  be  valid  or  binding  against 
anj^  such  association  when  it  is  required  thereunder  to  file  its  answer, 
pleading  or  defense  in  less  than  thirty  days  after  the  date  of  such 
service.  When  legal  process  against  any  association  is  served  upon 
said  Secretary  of  State,  he  shall  forward  forthwith  by  registered 
mail  one  of  the  duplicate  copies,  prepaid  and  directed  to  its  secretary 
or  corresponding  officer.  The  plaintiff  in  such  process  so  served 
shall  pay  to  the  Secretary  of  State  for  his  services  at  the  time  of 
such  service  a  fee  of  $2.00,  which  shall  be  recovered  by  him  as  a  part 
of  the  taxable  costs,  if  he  X'l'evails  in  the  suit. 

Section  20.  Be  it  further  enacted,  etc..  That  any  domestic  asso- 
ciation may  provide  that  the  meetings  of  its  legislative  or  governing 
bodj-  may  be  held  in  any  State,  district,  province  or  territory 
wherein  such  association  has  subordinate  branches,  and  all  business 
transacted  at  such  meetings  shall  be  as  valid  in  all  respects  as  if  such 
meetings  were  held  in  this  State.  But  its  ]irin('ipal  office  -shall  be 
located  in  this  State. 

Section  21.  Be  it  further  enacted,  etc..  That  officers  and  meniljers 
of  the  supreme  or  grand  or  any  subordinate  body  of  any  such  in- 
corporated association,  shall  not  be  individiutlly  liable  for  the  pay- 
ment of  any  disability  or  death  benefits  provided  for  in  the  laws  and 
contracts  of  such  association,  but  the  same  shall  be  payable  only 
out  of  the  funds  of  such  association  and  in  the  manner  ju-ovidcd  by 
its  laws. 


THE    STATE    OF    LOUISIANA  349 

Section  li'J.  Be  it  fui-tiicr'  enacted,  etc..  Tli.il  the  constitution  and 
laws  of  the  association  must  provide  that  no  subordinate  Ijody,  nor 
any  of  is  officers  or  members  shall  have  the  power  or  authority  to 
waive  any  of  the  provisions  of  the  laws  and  Constitution  of  the  asso- 
ciation, and  the  same  shall  be  biudiiiii  on  the  association  and  each 
and  (ivery  member  thereof. 

Section  23.  Be  it  further  enacted,  etc..  That  all  grand  lodges  bj' 
whatever  name  known,  whether  ineorpoi-ated  or  not.  holding  char- 
ters from  a  supreme  governing  bod.\',  which  are^ conducting  business 
in  this  State  upon  the  passage  of  this  Act  as  a  fraternal  beneficiary 
association  upon  what  is  known  as  the  separate  .iurisdietion  plan, 
shall  be  treated  as  a  federation  of  grand  lodges  and  not  as  single 
State  organizations,  and  all  rejiorts  required  by  the  provisions  of 
this  Act  shall  be  made  and  furnished  b.v  the  officers  of  each  supreme 
governing  body  and  shall  embrace  and  contain  the  transactions,  lia- 
bilities and  assets  of  the  entire  order,  providing  such  assets  are  liable 
for  the  debts  and  liabilities  of  the  subordinate  organizations. 

Section  24.  Be  it  further  enacted,  etc.,  That  every  association 
transacting  business  under  this  Act  shall  file  with  the  Secretary  of 
State  a  diily  certified  copy  of  all  amendments  of,  or  additions  to,  its 
constitution  and  laws,  within  ninety  days  after  the  enactment  of  the 
same.  Printed  copies  of  the  constitution  and  laws  and  of  additions 
or  amendments  thereto,  certified  by  the  secretary  or  corresponding 
ofiicer  of  the  association,  shall  be  prima  facie  evidence  of  the  legal 
adoption  thereof. 

Section  25.  Be  it  fi;rther  enacted,  etc..  That  every  association 
transacting  business  in  this  State,  shall  aiuiually.  on  or  before  the 
first  day  of  ]Mareh.  file  with  the  Secretary  of  State,  in  such  form  as 
he  may  require,  a  statement  under  oath  of  its  president  and  secre- 
tary, or  corresponding  officers,  of  its  condition  and  standing  on  the 
thirty-fir.st  day  of  December  next  preceding  and  of  its  transactions 
for  the  year  ending  on  that  date,  and  shall  also  furnish  such  other 
information  as  the  Secretary  of  State  may  deem  necessary  to  a 
proper  exhibit  of  its  business  and  iilan  of  working.  The  Secretary 
of  State  may  at  other  times  require  any  further  statement  he  may 
deem  necessary  to  be  made  relating  to  such  associations.  But  such 
Secretary  of  State  shall  neither  make  or  permit  to  be  made  from  any 


350  FRATERNAL    SOCIETY    LAW 

information  so  obtained  the  valuation  of  its  ontstanding  bonefit  cer- 
tificates unless  requested  to  make  such  valuation  by  the  association. 

Section  26.  Be  it  further  enacted,  etc.,  That  the  Secretary  of 
State,  or  any  person  he  may  appoint,  shall  have  the  power  of  visita- 
tion and  examination  into  the  affairs  of  any  domestic  association.  He 
ma.y  employ  assistants  for  the  purpose  of  such  examination,  and  he, 
or  any  person  he  may  appoint,  shall  have  full  access  to  an.y  books, 
papers  and  documents  that  relate  to  the  business  of  the  association, 
and  may  summon  and  qualify  as  witnesses  under  oath,  and  examine 
its  officers,  agents  and  employes  or  other  persons  in  relation  to  the 
aifairs,  transactions  and  condition  of  the  association.  The  expense 
of  such  examination  shall  be  paid  by  the  association  examined. 

Whenever  after  examination  the  Secretary  of  State  is  satisfied 
that  any  domestic  association  has  failed  to  comply  with  any  provis- 
ions of  this  law  or  is  exceeding  its  powers ;  or  is  not  carrying  out  its 
contracts  in  good  faith;  or  is  transacting  Inisiiiess  fraudulently;  or 
is  in  such  condition  as  to  render  further  proceedings  hazardous  to 
the  public  or  its  certificate  holders;  or  whenever  any  domestic  asso- 
ciation, after  the  existence  of  one  year  or  more,  shall  have  a  member- 
ship of  less  than  three  hundred,  or  votes  to  discontinue  business,  the 
Secretary  of  State  may  present  the  facts  relative  thereto  to  the  State 
Attorney  General,  who  shall,  if  he  deem  the  circumstances  warrant, 
commence  an  action  in  quo  warranto  in  a  court  of  competent  .i\u'is- 
diction,  and  such  court  shall  thereupon  notify  the  officers  of  such  as- 
sociations of  a  hearing,  and,  unless  it  shall  then  appear  that  some  spe- 
cial and  good  reason  exists  why  such  association  shcndd  not  be  closed, 
said  association  shall  be  enjoined  from  carrying  on  any  further  busi- 
ness, and  some  person  shall  be  appointed  receiver  of  such  associa- 
tion, and  shall  i)roeeed  at  once  to  take  ])ossession  of  the  books, 
papers,  moneys,  and  other  assets  of  the  association,  and  .shall  forth- 
with, under  the  direction  of  the  court,  proceed  to  close  the  affairs  of 
the  association  and  to  distribute  its  funds  to  those  entitled  thereto. 
No  such  i)roceeding  shall  be  commenced  by  the  State  Attorney  Gen- 
eral against  any  such  a.ssociation  until  after  notice  has  been  duly 
served  on  the  chief  executive  officers  of  the  association  and  a  reason- 
able opportunity  given  to  it  on  a  date  to  be  named  in  said  notice  to 
.show  cause  why  such  proceedings  should  not  he  commenced. 


THE    UTATE    OF    LOUIHIANA  351 

Section  27.  Be  it  further  enacted,  etc..  That  no  action  or  pro- 
eeedinji'  to  discontiiuie  or  enjoin,  in  whole  or  in  part,  the  business  or 
methoils  of  any  sneh  domestic  a.ssociatioti,  or  to  appoint  a  receiver 
thei'ct'or.  or  to  dissolvi-  the  same,  or  in  any  inamiiT  affcclitiK'  its  cor- 
porate rights,  or  to  oust  any  foreign  association,  or  enjoin  it  from 
transacting  business  in  this  State,  shall  be  entertained  by  any  court, 
except  on  the  suit  of  the  Attorney  General  of  this  State. 

Section  28.  Be  it  further  enacted,  etc.,  That  the  Secretary  of 
State,  or  any  person  whom  he  may  appoint,  may  examine  any  for- 
eign association  transacting  or  applying  for  admission  to  transact 
business  in  this  State.  The  Secretary  of  State  may  employ  assistants 
for  the  purpose  of  such  examination,  and  he,  or  any  person  he  may 
appoint,  shall  have  free  access  to  all  the  books,  papers  and  docu- 
ments that  relate  to  the  business  of  the  association,  and  may  sum- 
mon and  qualify  as  witnesses  under  oath  and  examine  its  officers, 
agents,  employes  and  other  persons  in  relation  to  the  affairs,  trans- 
actions and  condition  of  the  association.  He  may,  in  his  discretion, 
accept  in  lieu  of  such  examination  the  examination  of  the  insurance 
department  of  the  State,  territory,  district,  province  or  country 
where  such  association  is  organized.  All  examinations  made  under 
the  provisions  of  this  section  shall  be  made  at  the  expense  of  the 
association  examined. 

If  any  such  association  or  its  officers  refuse  to  submit  to  such 
examination,  or  to  comply  with  the  provisions  of  this  section  rela- 
ting thereto,  the  authority  of  such  association  to  transact  business  in 
this  State  shall  be  revoked  until  satisfactory  evidence  is  furnished 
the  Secretar.y  of  State  relating  to  the  condition  and  affairs  of  the 
association,  and  during  such  revocation  the  association  shall  not 
transact  any  business  in  this  State. 

Section  29.  Be  it  further  enacted,  etc..  That  when  the  Secretary 
of  State  on  investigation  is  satisfied  that  any  foreign  association 
transacting  business  mider  this  Act  has  exceeded  its  powers,  or  has 
failed  to  comply  with  the  provisions  of  the  law,  or  is  conducting 
business  fraudulently,  or  is  not  carrying  out  its  contracts  in  good 
faith,  or  is  in  such  condition  as  to  render  further  proceedings  hazard- 
ous to  the  public  or  its  certificte  holders,  he  may  revoke  the  certifi- 
cate of  authority  granted  to  it,  and  shall  cause  notification  thereof 


352  -  FRATERNAL    SOCIETY    LAW 

to  be  published  in  one  or  more  newspapers  of  t;eneral  circulation, 
and  no  new  business  shall  thereafter  be  done  by  it  or  its  agents  in 
this  State  while  such  default  or  disability  continues,  nor  until  its 
authority  to  do  business  is  restored  by  the  Secretary  of  State ;  pro- 
vided, that  nothing  in  this  Act  shall  prevent  such  association  from 
aijplying  to  a  court  of  competent  jurisdiction,  by  mandamus  or 
otherwise,  to  compel  said  Secretary  of  State  to  issue  such  certificate, 
if  such  court,  in  its  discretion,  should  determine  that  said  association 
was  entitled,  under  the  law,  to  have  said  certificate  issued  to  it. 

Section  30.  Be  it  further  enacted,  etc..  That  nothing  contained 
in  this  Act  shall  be  construed  to  affect  or  apply  to  grand  or  subordi- 
Tiate  lodges  of  Masons.  Odd  Fellows  or  Knights  of  Pythias  (exclusive 
of  the  insurance  branch  of  the  Supreme  Lodge  Knights  of  Pythias), 
or  to  similar  orders  which  do  not  issue  insurance  certificates,  nor  to 
local  lodges  of  an  association  now  doing  business  in  this  State  that 
do  not  issue  certificates  that  provide  death  benefits  not  exceeding 
three  hundred  dollars  to  any  one  person,  or  disability  benefits  not 
exceeding  three  hundred  dollars  in  any  one  year  to  any  one  person, 
or  both ;  nor  to  domestic  associations  which  limit  their  membership 
to  the  emploj'es  of  a  particular  city  or  town,  designated  firm,  busi- 
ness house  or  corporation.  The  Secretary  of  State  may  require  from 
any  association  such  information  as  will  eiuible  him  to  determine 
whether  such  association  is  exempt  from  the  provisions  of  this  Act. 
No  association  which  is  exempt  by  the  provisions  of  this  section 
from  the  requirements  of  this  Act  shall  give  or  allow,  or  promise  to 
give  or  allow,  to  any  person  any  compensation  for  procuring  new 
members. 

Section  31.  Be  it  further  enacted,  etc..  That  associations  coming 
within  the  definition  of  fraternal  beneficiary  associations  as  defined 
by  this  Act,  and  now  transacting  business  as  fraternal  beneficiary 
associations,  doing  business  in  this  State  prior  to  and  at  the  time  of 
the  passage  of  this  Act.  and  which  shall  have  established  or  may 
hereafter  establish  rates  deemed  by  it  adequate  to  perpetuate  its 
existence  or  meet  its  obligations,  and  in  so  doing  has  increased  or 
shall  increase  the  payments  required  to  be  made  by  any  member, 
so  that  sucli  nicmber  shall  be  unable  for  any  reason  to  make  such 
payniciit  and  to  coiitinn<'  his  nii'inl)erslii]i,  in  such  case  or  cases  any 


THE    t^TATH    OF    LOUISIANA  353 

siieh  as.sotiiatioii  may  make  snoli  allowance  to  sueh  member  or  mem- 
bers, by  way  of  extended  insurance,  or  reduced  benefit  ])ayalib='  to  a 
l)eneficiary  designated  in  accordance  with  tlie  jirovisions  of  Seetioii 
(■)  of  this  Act,  as  it  may  determine  to  be  equitable  and  provided  for 
by  the  laws  and  regulations,  and  may  provide  for  paying  the  cost 
of  carrying  such  extended  insurance  out  of  any  reserve,  emergency, 
surplus  or  other  fund  it  has  or  shall  accumulate  or  create. 

The  provisions  of  this  section  shall  not  be  construed  as  applicable 
to  any  association  which  does  not  make  provision  for  such  extended 
insurance  in  its  laws  or  regulations,  nor  shall  the  members  of  any 
association  which  does  not,  by  its  laws  or  regulations,  make  provis- 
ion for  such  extended  insurance,  have  any  right  to  or  interest  in  any 
fund  which  any  sueh  association  may  have  now  or  may  hereafter 
create,  either  as  a  reserve,  emergency,  surplus  or  other  fund. 

Section  32.  Be  it  further  enacted,  etc.,  That  such  associations 
shall  not  employ  paid  agents  in  soliciting  or  procuring  members, 
exei'pt  in  the  organization  or  building  up  of  subordinate  bodies,  or 
granting  meml)(>rs  inducements  to  procure  new  members. 

Section  :]3.  Be  it  further  enacted,  etc.,  That  each  and  every  cer- 
tiiicate  issued  by  any  association  operating  under  the  provisions  of 
this  Act  shall  be  incontestable  on  account  of  erroneous  or  innocent 
statements  made'in  the  ajiplication  as  to  age,  provided  the  member 
was  within  the  age  limit  for  membership  at  the  time  of  the  applica- 
tion; and  provided,  fiirther,  that  in  the  settlement  of  any  loss,  where 
there  was  an  error  as  to  age,  sueh  settlement  shall  be  made  on  the 
basis  of  the  correct  age.  But  no  association  operating  under  the  pro- 
visions of  this  Act  shall  contest  the  age  of  any  member  after  his 
death,  unless  the  proof  offered  by  the  beneficiary  shows  the  age  of 
llie  deceased  member  to  be  different  from  that  given  in  his  applica- 
tion; then  the  correct  age  may  be  ascertained  and  settlement  made 
as  herein  provided. 

Section  34.  Be  it  further  enacted,  etc..  That  any  person,  officer, 
member  or  examining  physician,  who  shall  knowingly  or  wilfully 
make  any  false  or  fraudulent  statement  or  representation  in  or  with 
reference  to  any  application  for  membership,  or  for  the  purpose  of 
obtaining  money  from  or  benefit  in  any  association  transacting  busi- 
ness under  this  Act,  shall  be  guilty  of  a  misdemeanor,  and  upon  con- 
23 


354  FRATERNAL    SOCIETY    LAW 

viction  thereof  shall  be  punished  by  a  fine  of  not  less  than  one 
hundred  dollars  nor  more  than  three  hundred  dollars,  or  imprison- 
ment in  the  parish  jail  for  not  less  than  thirty  days  nor  more  than 
three  months,  or  both,  in  the  discretion  of  the  court;  and  any  person 
who  shall  wilfully  make  a  false  statement  of  any  material  fact  or 
thing  in  a  sworn  statement  as  to  the  death  or  disability  of  a  certifi- 
cate holder  in  any  such  association,  for  the  purpose  of  procuring 
payment  of  a  benefit  named  in  the  certificate  of  such  holder,  and 
an.y  person  who  shall  wilfully  make  any  false  statement  in  any  veri- 
fied report  or  declaration  under  oath  required  or  authorized  by  this 
Act,  shall  be  guilty  of  perjury,  and  shall  be  proceeded  against  and 
punished  as  provided  b.y  the  statutes  of  this  State  in  relation  to  the 
crime  of  perjury.  Any  person  who  shall  solicit  membership  for,  or 
in  any  manner  assist  in  procuring  membership  in,  any  association 
not  licensed  to  do  business  in  this  State,  or  who  shall  solicit  member- 
ship for,  or  in  any  manner  assist  in  procuring  membership  in  any 
such  association  not  authorized  as  herein  provided  to  do  business  as 
herein  defined  in  this  State,  shall  be  guilty  of  a  misdemeanor,  and 
upon  conviction  thereof  shall  be  punished  by  a  fine  of  not  less  than 
fifty  nor  more  than  two  hundred  dollars.  An.y  association,  or  any 
officer,  agent  or  emjjloye  thereof,  neglecting  or  refusing  to  comply 
with,  or  violating  any  of  the  provisions  of  this  Act,  the  penalty  for 
which  neglect,  refusal  or  violation  is  not  specified  in  this  section, 
shall  be  fine  not  less  than  one  hundred  dollars  nor  more  than  three 
hundred  dollars,  or  imprisonment  in  the  parish  jail  for  not  less  than 
thirty  days  nor  more  than  three  months,  iipon  conviction  thereof. 

Section  35.  Be  it  further  enacted,  etc..  That  the  word  'associa- 
tion,' as  used  in  this  Act,  shall  be  taken  and  construed  as  meaning  a 
fraternal  beneficiary  corporation,  society,  order  or  voluntary  associa- 
tion as  defined  by  this  Act.  The  words  'domestic  association'  shall 
be  taken  and  construed  as  meaning  an  association  organized  or  in- 
corporated under  the  laws  of  this  State.  The  words  'foreign  asso- 
ciation' shall  be  taken  and  construed  as  meaning  an  association 
organized  or  incorporated  under  the  laws  of  another  State,  territory, 
district,  province  or  country.  The  woi'd  'State,'  as  used  in  this 
Act,  shall  be  taken  and  construed  as  meaning  'State,'  'Territory,' 
'District,'  'Country.'  or  'Province.'     All  iirovisioiis  of  each  section 


THE    STATE    OF    LOUISIANA  355 

of  tliis  Act  except  as  otherwise  provided  shall  be  taken  and  con- 
strued as  applying'  to  l)otli  domestic  and  foreii,'n  associations. 

Section  36.  Be  it  further  enacted,  (itc,  That  iH)thing  contained  in 
this  Act  shall  be  construed  to  require  any  society  to  make  or  cause  to 
be  made  any  valuation  of  its  benefit  certificates  for  any  purpose 
whatever,  nor  shall  the  Secretary  of  State  have  the  right  to  require 
or  demand  that  such  valuation  be  made  or  embraced  in  th(!  report  of 
any  fraternal  beneficiary  society  to  the  insurance  department,  pro- 
vided, that  every  certificate  issued  by  fraternal  associations  that 
provides  for  a  fixed  benefit,  stipulates  in  a  conspicuous  manner  that 
in  the  event  the  regular  payments  are  iosufficient  to  pay  all  matured 
death  and  disability  claims,  the  right  is  reserved  thereunder  to  levy 
additional  assessments  to  meet  such  deficiency,  otherwise  the  Secre- 
tary of  State  shall  value  all  certificates  annually  according  to  the 
National  Fraternal  Congress  Tables,  with  four  per  cent,  compound 
interest. 

Section  37.  Be  it  further  enacted,  etc.,  That  all  laws  and  parts  of 
laws  in  conflict  with  the  provisions  of  this  Act,  be  and  the  same  are 
hereby  repealed. 

Section  38.  Be  it  fui-ther  enacted,  etc..  That  this  Act  take  effect 
from  and  after  its  passage. ' ' 

The  State  of  Louisiana  by  act  approved  July  4,  1906,  enacted  a 
code  relating  to  certain  kinds  of  so-called  Fraternal  Societies,  which 
act  is,  viz. : 

"An  Act  to  define  and  regulate  the  business  of  industrial  life  insur- 
ance ;  to  provide  the  manner  in  which  foreign  and  domestic  corpor- 
ations, associations,  societies,  or  fraternal  orders  doing  business 
of  industrial  life  insurance  shall  be  authorized  to  do  business  in 
this  State ;  to  provide  for  the  making  of  a  deposit  with  the  Treas- 
urer of  the  State  by  such  corporations,  associations,  societies  or 
fraternal  orders  as  a  condition  precedent  to  doing  business  in  this 
State,  and  to  fix  the  amount  thereof.  Provided,  that  foreign  cor- 
porations, associations,  relief  organizations,  societies  or  fraternal 
orders  that  have  made  sufficient  deposit  in  the  State  in  which  they 
are  incorporated,  or  that  have  made  sufficient  deposit  in  any  other 
State,  shall  not  be  required  to  make  such  deposit  in  this  State,  and 


356  FRATERNAL    SOCIETY    LAW 

fixing  penalties  for  the  violation  of  this  Act,  and  to  repeal  all  laws 
in  conflict  with  this  Act. 

Section  1.  Be  it  enacted  by  the  General  Assembly  of  the  State  of 
Louisiana,  That  industrial  life  insurance  is  hereby  defined  to  be 
that  insurance  for  which  the  stipulated  premiums,  advance  assess- 
ments or  dues  are  regularly  payable  and  collectable  every  four 
weeks,  tri-weeklj^,  bi-weekly,  weekly,  semi-weekly  or  at  any  other 
stated  terms  less  than  a  month  apart,  and  the  policies  or  benefit  cer- 
tificates for  which  are  for  sums  of  five  hundred  dollars  or  less  on  a 
single  life  on  which  policies  or  benefit  certificates  provide  a  weekly 
cash  benefit  for  disability,  caused  by  sickness  or  accident,  of  twenty 
dollars  per  week  or  less,  or  which  provide  for  the  attendance  of  a 
physician  or  supplying  of  drugs,  or  furnishing  a  funeral. 

Section  2.  Be  it  further  enacted,  etc..  That  all  corporations,  so- 
cieties, relief  organizations,  fraternal  orders  or  associations,  with  or 
without  capital  stock,  and  having  or  not  having  a  ritualistic  form  of 
government,  whether  operating  under  the  present  insurance  laws  as 
insurance  companies,  or  operating  under  the  laws  governing  fra- 
ternal beneficiary  orders,  and  issuing  policies  or  benefit  certificates 
and  carrying  on  their  l)nsiuess  in  the  manner  and  within  the  mean- 
ing and  definition  set  forth  in  Section  1  of  this  Act,  shall  be  held  and 
deemed  to  be  doing  an  industrial  life  insurance  business  and  shall 
be  subject  to  this  Act  and  all  the  other  laws  of  this  State,  not  re- 
pugnant to  this  Act,  regulating  the  business  of  life,  health  and  acci- 
dent insurance  in  this  State. 

Section  3.  Be  it  further  enacted,  etc..  That  any  corporation,  asso- 
ciation, society  or  fraternal  order  organized  under  the  laws  of  this 
State,  whether  organized  upon  the  mutual  assessment  plan  or  as  a 
stock  company,  for  the  purpose  of  doing  the  business  of  industrial 
life  insurance,  as  in  this  Act  defined,  shall,  before  commencing  to  do 
business  in  this  State,  comply  with  the  laws  of  this  State,  regulating 
the  manner  in  which  other  insurance  companies  shall  be  authorized 
to  do  business  in  this  State,  except  that  a  deposit  of  one  thousand 
($1,000.00)  dollars,  where  the  membership  is  one  thousand  or  less, 
and  for  every  additional  one  tliousand  members  oi'  fraction  of  one 
thousand   added   to   the   iuenilu'i-shi|)   an   additional   (lejiosit  of  five 


THE    STATE    OF    LOUISIANA  357 

hundred  ($500.00)  dollars,  uiitU  the  totiil  sum  of  five  thousMiid  ($5,- 
000.00)  dollars  has  been  deposited,  shall,  be  made  by  comi)anies 
operating  upon  the  i)lan  and  accortling  to  the  manner  specified  in 
this  Act.  Such  deposit  shall  be  made  with  the  State  Treasurer  of 
this  State  in  such  securities  as  are  now  required  of  surety  companies, 
and  shall  be  held  subject  to  any  chiim,  liens  or  judgments  that  may 
be  judicially  obtained  aginst  them  in  the  courts  of  this  State,  or  the 
Federal  courts  in  this  State,  or  arising  from  any  contract  of  insur- 
ance or  indemnity,  entered  into  in  this  State,  and  to  be  liable  to 
seizure  and  sale  at  the  instance  of  any  judgment  creditor  of  such 
companies,  under  judgment  obtained  in  any  of  the  courts  of  this 
State  or  of  the  Federal  courts  in  this  State  against  them. 

Section  4.  Be  it  further  enacted,  etc.,  That  any  corporation,  asso- 
ciation, society  or  fraternal  order  organized  under  the  laws  of  any 
other  State  upon  the  mutual  assessment  plan  or  as  a  stock  company 
for  the  purpose  of  doing  business  of  industrial  life  insurance  as  in 
this  Act  defined,  shall  be  authorized  to  do  business  in  this  State 
upon  complying  with  the  other  laws  of  this  State  regulating  the 
manner  in  which  foreign  insurance  companies  shall  be  authorized  to 
do  business  in  this  State,  and  filing  with  the  Insurance  Commissioner 
of  this  State,  a  certificate  from  the  officer  having  supervision  of  the 
Insurance  Department  of  the  State  under  the  laws  of  which  such 
corporation,  association,  society  or  fraternal  order  was  chartered  or 
elects  to  make  its  deposit,  that  such  corporation,  a.ssociation,  society 
or  fraternal  order  has  deposited  with  said  State  a  sum  of  not  less 
than  five  thousand  dollars  ($5,000.00)  in  such  securities  as  are  re- 
quired to  be  deposited  by  insurance  companies  in  said  States. 

Section  5.  Be  it  further  enacted,  etc..  That  the  provisions  of  this 
Act  shall  in  no  way  apply  to  any  company,  organization  or  associa- 
tion or  society  which  does  not  collect  its  premiums  or  dues  eveiw  four 
weeks,  tri-weekly,  bi-weekly,  weekly,  semi-weekly,  or  at  any  stated 
.terms  of  days  less  than  a  month  apart,  but  any  company,  organiza- 
tion, association,  society  or  fraternal  beneficiary  order,  with  or  with- 
out a  ritualistic  form  of  government,  which  collects  its  dues  or  pre- 
miums every  four  weeks,  tri-weekly.  bi-weekly,  weekly,  semi-weekly 
or  at  any  stated  terms  of  days  less  than  a  month  apart,  shall  come 
under  the  provisions  of  this  Act. 


358  FRATERNAL    SOCIETY    LAW 

Section  6.  Be  it  further  enacted,  etc.,  That  all  officers,  directors, 
managers,  employees  and  agents  of  foreign  and  domestic  corpora- 
tions, relief  organizations,  societies  and  fraternal  orders,  who  shall 
conduct  or  attempt  to  conduct  the  business  of  industrial  life  insur- 
ance without  having  first  complied  with,  or  who  in  any  manner  vio- 
late, or  refuse  or  neglect  to  comply  with  the  provisions  and  require- 
ments of  this  Act,  shall  be  deemed  guilty  of  a  misdemeanor,  and 
upon  conviction  before  any  court  of  competent  jurisdiction  shall  be 
fined  not  less  than  fifty  dollars  ($50.00)  or  more  than  two  hundred 
dollars  ($200.00),  or  be  imprisoned  in  the  parish  jail  (parish  prison 
in  the  city  of  New  Orleans)  not  less  than  thirty  (30)  or  more  thaa 
ninety  (90)  days. 

Section  7.  Be  it  further  enacted,  etc..  That  no  law,  hereafter 
passed,  shall  be  held  or  deemed  to  refer  to  the  business  of  industrial 
life  insurance  unless  the  same  is  expressly  referred  to  in  said  law. 

Section  8.  Be  it  further  enacted,  etc.,  That  this  Act  shall  become 
efliective  from  and  after  January  first,  nineteen  hundred  and  seven, 
and  that  all  laws  and  parts  of  laws  in  conflict  with  this  Act,  be  and 
the  same  are  hereby  repealed. ' ' 

By  act  approved  June  30,  1902,  the  Legislature  of  the  State  of 
Louisiana  passed  an  act  providing  for  a  tax  on  certain  Fraternal  and 
Benevolent  Societies  and  while  this  act  does  not  apply  to  the  ordi- 
nary Fraternal  Society,  its  embodiment  here  is  deemed  proper.  The 
act  is  as  follows : 

"An  Act  to  levy  a  license  tax  upon  all  benevolent  or  fraternal  so- 
cieties or  associations  who,  through  agents,  solicit  membership 
from  house  to  house. 

Section  1.  Be  it  enacted  by  the  General  Assembly  of  the  State  of 
Louisiana,  That  each  and  eveiy  benevolent  or  fraternal  society  or 
association  Avhich  may,  through  solicitors  or  agents,  solicit  member- 
ship therein  from  house  to  house,  and  who  pay  compensation  to  such 
solicitors  or  agents  for  their  services,  shall  pay  a  license  on  the  said 
business  as  follows,  to-wit: 

First  Class — When  the  gross  annual  I'eceipts  or  collections  from 
tlie  members  of  such  society  or  association  shall  amount  to  fifty 


THE    HTATE    OF    LOUISIANA  359 

thousaiul  (lolhirs  or  more,  the  license  sluill  he  three  hundred  and 
seventy-five  ($375.00)  doUars. 

Second  Class- — When  the  said  gross  annual  receipts  or  collections 
from  the  members  of  such  society  or  association  shall  amount  to 
forty  thousand  dollars,  and  less  than  fifty  thousand  dollars,  the 
license  shall  be  three  hundred  ($300.00)  dollars. 

Third  Class — When  the  gross  annual  receipts  or  collections  from 
the  members  of  such  society  or  association  shall  amount  to  thirty 
thousand  dollars,  and  less  than  forty  thousand  dollars,  the  license 
shall  be  two  hundred  and  twenty-five  ($225.00)  dollars. 

Fourth  Class — When  the  said  gross  annual  receipts  or  collections 
from  the  members  of  such  society  or  association  shall  amount  to 
twenty  thousand  dollars,  or  less,  the  license  shall  be  one  hundred 
and  fifty  ($150.00)  dollars. 

Section  2.  Be  it  further  enacted,  etc..  That  within  sixty  (60)  days 
from  the  passage  of  this  Act  each  of  the  benevolent  oi-  fraternal 
societies  or  associations  engaged  in  business  in  this  State,  shall  de- 
posit with  the  Secretary  of  State  for  recordation,  a  certified  copy 
of  its  act  of  incorporation,  together  with  a  copy  of  the  certificate  of 
membership,  which  is  issued  by  it  to  its  members;  and,  also,  a  copy 
of  the  form  of  application  for  membership ;  and  no  such  society  or 
association  shall  conduct  or  prosecute  any  business  before  a  com- 
pliance with  the  requirements  of  this  section,  and  any  officer  or 
member  of  such  society  or  association  who  shall  do  any  act  in  fur- 
therance of  the  objects  and  purposes  thereof  before  the  requirements 
of  this  section  shall  have  been  complied  with,  on  conviction  thereof 
before  a  court  of  competent  .jurisdiction,  be  fined  not  more  than  one 
hundred  dollars,  or  imprisoned  for  a  period  of  not  more  than  thirty 
days,  or  both,  in  the  discretion  of  the  court. 

Section  3.  Be  it  further  enacted,  etc..  That  all  remedies  provided 
in  existing  laws  for  the  collection  of  licenses  and  all  penalties  for 
the  non-payment  thereof,  now  provided  by  existing  law,  or  may  be 
provided  by  future  laws,  shall  apply  and  be  available  to  all  of  the 
licenses  imposed  by  this  Act. 

Section  4. — Be  it  further  enacted,  etc..  That  this  Act  shall  not 
affect  or  apply  to  any  secret  fraternal  organization  in  this  State. 

Section  5.     Be  it  further  enacted,  etc..  That  this  Act  shall  take 


360  FRATERNAL    SOCIETY    LAW 

efieet  ironi  and  after  its  passage,  and  all  laws  or  parts  of  laws  in 
conflict  with  this  Act  are  hereby  repealed." 

The  act  of  the  Louisiana  Legislature  approved  July  8,  1898, 
entitled, 

'An  Act  to  provide  for  recording  and  keeping  a  record  in  the  office 
of  the  Secretary  of  State  of  all  charters  of  corporations,  proofs  of 
publication  thereof;  amendments  thereto,  and  proceedings  rela- 
tive to  the  consolidation,  dissolution,  and  liquidation  of  corpora- 
tions ;  to  provide  for  the  use  and  effect  as  evidence  of  extract  and 
certificate  from  such  record, ' ' 

is  believed  to  apply  to  Fraternal  Societies,  and  is  as  follows : 

Section  1.  Be  it  enacted  by  the  General  Assembly  of  the  State 
of  Louisiana,  That  all  corporations  (except  those  organized  for  lit- 
erary, scientific,  religious,  educational  or  charitable  purposes)  here- 
after doing  business  in  the  State  of  Louisiana,  shall  tile  with  the  Sec- 
retai-y  of  State :  First — A  duly  certified  copy  of  their  charters,  taken 
either  from  the  record  of  the  notary  before  whom  the  act  of  in- 
corporation was  passed,  or  from  the  record  thereof  in  the  office  of  the 
recorder  in  whose  office  said  charter  shall  have  been  recorded,  to 
which  copy  shall  be  affixed  the  certificate  of  such  recorder  attesting 
recordation  of  the  acts  in  his  office  and  giving  book  and  folio  of  such 
record,  or  a  published  copj^,  duly  certified  by  one  of  said  officers. 
Second — A  copy  of  one  issue  of  the  newspaper  wherein  the  said 
charter  shall  have  been  published,  when  such  publication  is  required 
by  law,  together  with  the  affidavit  of  the  publisher,  making  oath  to 
the  fact  that  said  charter  was  duly  published  in  his  paper  as  required 
by  law.  Third — A  certified  copy  of  any  and  all  amendments  to  said 
charters,  taken  either  from  the  record  thereof  in  the  office  of  the 
recorder  where  the  same  shall  have  been  recorded,  as  required  by 
law,  or  from  the  records  of  the  notary  public  before  whom  the  act 
of  incorporation  was  passed,  to  which  copy  shall  be  attached  a  cer- 
tificate of  such  recorder,  attesting  the  fact  that  the  same  has  been 
recorded  in  his  office  and  giving  the  book  and  folio  of  such  record. 
Fourth — A  copy  of  the  minutes  of  any  and  all  meetings  of  stock- 
lidldiTs  or  directors  containing  all  proceedings  of  sueli  stockhold'Ts 


THE    HTATK    OF    LOUIfilANA  3(il 

jiiiil  (liiTc'tors  in  reference  to  siu'h  jiinciKlincnt  of  charter-,  iluly  at- 
tested by  the  secretary  of  such  corporation,  whose  signature  to  such 
attestation  shall  be  duly  acknowledged.  Fifth — Any  and  all  agree- 
ments for  the  consolidation  of  corporations,  together  with  copies 
from  the  minutes  of  any  meetings  of  stockholders  or  directors  au- 
thorizing or  pertaining  to  the  consolidation,  dissolution,  or  liquida 
tion  of  any  corporations,  the  signatures  to  such  agreements  to  be 
duly  acknowledged  and  the  copies  of  such  minutes  to  be  duly 
attested  by  the  secretary  of  such  cm-poi-ation,  whose  signature  to 
such  attestation  shall  be  duly  acknowledged. 

Section  2.  Be  it  further  enacted,  etc.,  That  the  Secretary  of 
State  shall  keep  books  in  which  to  transcribe  and  record  all  of  the 
documents  and  writings,  by  the  first  section  of  this  Act  required  to 
be  filed  in  his  office  (other  than  the  newspapers  therein  described), 
which  books  shall  be  numbered  consecutively,  and  to  which  books 
he  shall  keep  proper  indices. 

Section  3.  Be  it  further  enacted,  etc.,  That  the  Secretary  of  State 
shall  keep  on  file  in  his  office  the  newspapers  required  to  be  filed 
with  him,  as  provided  in  Section  1  of  this  Act,  and  he  shall  make  au 
entry  in  the  book,  provided  by  Section  2  of  this  Act,  attesting  the 
fact  that  such  newspapers  have  been  filed  with  him  and  that  such 
charter  has  been  published. 

Section  4.  Be  it  further  enacted,  etc.,  That  extracts  from  the 
books,  provided  by  Section  2  of  this  Act,  dul.v  attested  by  the  Sec- 
retary of  State,  shall  be  admissible  in  evidence  in  all  courts,  and 
shall  constitute  prima  facie  proofs  of  all  facts  stated  in  such  extracts. 

Section  5.  Be  it  further  enacted,  etc..  That  this  Act  shall  take 
effect  from  and  after  its  passage." 

Denial  of  Liability  Waives  Necessity  for  Proofs  of  Loss. 

The  denial  of  liability  is  held  to  be  a  waiver  of  proofs  of  loss,  and 
whether  there  was  such  a  denial  of  liability  is  a  question  to  be  de- 
termined as  any  other  fact  necessary  to  l)e  ju-oved. 

St.  Landry  Wholesale  Mer.  Co.  vs.  Teutonia  Life  Insurance  Co.,  Jan- 
uary, 1905,  113,  La.  1053,  37  So.  967. 


-362  FRATERNAL    SOCIETY    LAW 

Materiality  Conceded  From  Special  Enquiry. 

A  matter  specifically  inquired  about  in  a  question  propounded  to 
a  party  seeking  to  obtain  a  policy  of  life  insurance,  and  the  answer 
thereto,  are  equal  to  the  agreement  that  the  matter  inquired  about 
is  material,  and  any  misrepresentation  in  the  answer  will  void  the 
policy,  though  the  matter  may  not  have  been  really  material  to  the 
risk  of  the  particular  case. 

Brignac  vs.  Pac.  Mutual  Life  Ins.  Co.,  February,  1904,  112  La.  573, 
36  So.  595. 

Death  by  Own  Act— Suicide. 

The  death  of  a  person  resulting  from  morphine  administered  by 
himself  is  in  one  sense  death  from  his  own  act,  but  it  is  not  neces- 
sarily suicide.  And  where  a  clause  in  a  contract  of  life  insurance 
read,  "if  I  die  by  my  own  hand  or  act,  voluntarily  or  involuntarily, 
sane  or  insane,"  the  court  said  that  this  was  a  mere  ordinary  suicide 
clause. 

Brignac  vs.  Pac.  Mutual  Life  Ins.  Co.,  February,  1904,  112  La.  573, 
36  So.  595. 

Circumstantial  Evidence  to  Prove  Suicide. 

In  reaching  their  conclusions  as  to  whether  a  person  has  com- 
mitted suicide,  courts  are  not  tied  down  by  the  rigid  rules  of  the 
criminal  law.  They  are  authorized  to  act  upon  circumstantial,  as 
well  as  direct  evidence.  The  evidence  upon  which  they  act  should 
be  weighty,  precise,  and  consistent. 

Brignac  vs.  Pac.  Mutual  Life  Ins.  Co.,  February,  1904,  112  La.  573, 
36  So.  595. 

Untrue  Answers  in  Application. 

When  answers  matle  by  a  party  in  his  application  for  life  insur- 
ance to  questions  which  are  lu-opmuuled  to  him  by  the  comjiany, 
were   such   as   might  have   iiifliu'iici'd    tin-   company  to   determine 


THE    STATE    OF    LOUISIANA   .  363 

whctlici-  to  accept  the  risk  and  to  deteriuiiic  what  premium  to  charge, 
the  answers  must  be  truthful,  and  if  untrue,  tlie  contract  is  avoided. 

Brignac  vs.  Pac.  Mutual  Life  Ins.  Co.,  February,  1904,  112  La.  573, 
36  So.  595. 

Forfeiture — Self-executing  Provisions. 

A  member  failed  to  pay  the  regular  monthly  assessment  fixed  by 
the  by-laws,  and  which  fell  due,  without  notice,  on  the  31st  of 
October,  1901.  On  the  26th  day  of  November,  following,  he  died, 
his  assessment  still  being  unpaid.  Non-payment  of  the  assessment 
by  itself  operated,  und'er  the  by-laws  of  the  society,  to  effect  an  im- 
mediate suspension  of  the  member,  and  to  deprive  him  of  all  benefits 
of  his  contract,  if  he  should  die  while  under  suspension ;  and  it  was 
held  that  the  by-laws  were  self-enforcing  and  binding. 

Feiber  vs.  Supreme  Council  American  Legion  of  Honor,  May,  1904, 
112  La.  960,  36  So.  SIS. 

r     I 

Reduction  of  Benefits  by  After-enacted  By-law. 

A  clause  in  a  benefit  certificate,  providing  that  a  member  agrees 
to  comply  with  all  the  by-laws  of  the  society  then  in  existence  or 
that  thereafter  may  be  adopted,  cannot  be  held  to  authorize  the 
society  to  reduce  the  amoimt  stipulated  in  the  certificate  to  be  paid 
upon  the  death  of  the  member,  and  if  assessments  on  the  reduced 
basis  are  paid  such  would  not  be  construed  into  acquiescence  of  the 
reduction  in  the  certificate,  when  such  payments  were  made  under 
protest,  and  vnth  tender  of  the  full  amount  that  would  have  been 
due,  if  the  reduction  had  not  been  made. 

Russ  vs.  Supreme  Council  American  Legion  of  Honor,  March,  1903, 
110  La.  5SS,  34  So.  697. 

Beneficiary — Idem  Sonans. 

A  beneficiary  named  in  a  certificate  being  designated  by  name, 
with  the  ■  description  that  she  was  the  wife  of  the  member,  and 
this  member  having  biit  one  wife,  it  was  held  that  there  was  no  un- 


364  FRATERNAL    SOCIETY    LAW 

certainty  that  might  result  from  calling  the  beneficiary  "  Georgia  J. 
Rayne, "  instead  of  "Georgiana  Jackson  Rayne." 

Russ  vs.  Supreme  Council  American  Legion  of  Honor,  MaTch,  1903, 
110  La.  5S8,  34  So.  697. 

Suicide — Accidental  Death  Presumed. 

Where  suicide  is  pleaded  as  a  defense  to  an  action  to  recover 
on  an  insurance  contract,  before  such  defense  can  be  availed  of, 
every  reasonable  hypothesis  of  accidental  death  must  be  excluded. 
Under  the  facts  in  the  case,  the  member  was  found  dead  with  a 
gun-shot  wound,  and  he  was  alone  at  the  time  when  the  act  was 
committed  so  far  as  the  evidence  showed. 

Boynton  vs.  Equitable  Life  Assurance  Society,  1900,  105  La.  202. 

Suicide — Use  of  Opiates — Presumptions. 

On  two  occasions,  the  insured  took  oj^iates  which  caused  him  to 
be  ill.  This  was  some  time  prior  to  his  death.  When  his  body  was 
found,  his  death  having  been  caused  by  a  gun-shot  wound,  the 
court  held  that  it  did  not  follow  from  the  member  having  taken 
opiates  that  the  presumption  against  suicide  was  de.stroyed,  or  that 
the  taking  of  opiates  was  to  be  x)resumed  with  sitieidal  intent. 

Boynton  vs.  Equitable  Life  Assurance  Society,  1900,  105  La.  202. 

Risks  Not  Assumed — Suicide,  Etc. 

The  following  provision  in  a  contract  of  insurance  was  upheld 
(the  facts  established  a  complete  defense  to  the  claim  upon  the  con- 
tract under  consideration:)  "Death  of  said  member  caused  by  any 
violation  of  law,  or  l).y  his  own  hand,  whether  sane  or  insane,  volun- 
tary or  involuntary,  is  not  a  risk  assumed  by  this  contract,  within 
three  months  from  its  date,  when  his  disability  is  thus  caused  by 
such  a  risk  at  any  time." 

The  facts  proven  iipon  the  trial  sliowcil  that  tlic  niriubcr  s;iiei<h'(l. 

Wolff  vs.  Mutual  Reserve  Fund  Life  ..ssociation.   May   15th,   1S99,   51 
La.  Ann.  1261. 


THE    STATE    OF    LOUISIANA  365 

Warranty — Waiver— Estoppel. 

The  aj)plii';uit  for  lii'o  insuiMiicc  stated  in  his  application  that 
lu^  had  never  at  any  time  .-ipiilicd  for  a  policy  of  insurance  on  his 
life  and  been  rejected.  This  was  not  true.  The  company  when  the 
application  was  made,  had  within  reach  information  as  to  the  falsity 
of  this  answer,  but  did  not  avail  itself  of  this  information,  and  it 
was  held  that  the  company  had  waived  the  truth  of  this  riiprcsenta- 
tion,  and  was  estopped  to  S(.'t  up  its  falsity  as  a  defense  to  the  con- 
tract. 

Union  Nat'l  Bank  vs.  Manhattan  Life  Insurance  Co.,  November,  ±899, 
52  La.  Ann.  36. 

Warrar.ty — Materiality  of  Statements. 

A  warranty  contained  in  a  contract  of  life  insurance  must  be 
strictly  and  literally  fulfilled  before  the  insured  is  entitled  to  recover 
on  the  contract,  and  the  warranty  need  not  be  material  to  the  risk. 
because  it  is  of  itself  an  implied  agreement  that  the  representations 
warranted  are  material. 

Petitpain   vs.   Mutual   Reserve  Fund   Life    Ass'n,    January,    1900,    52 
La.   Ann.   503. 

After-enacted  Laws — Suicide. 

A  certificate  was  issued  at  a  time  when  there  was  no  provision 
either  in  the  certificate  or  in  the  laws  of  the  society  providing 
against  death  by  suicide.  Subsequently  the  society  passed  a  suicide 
by-law  providing  for  non-liability  in  cases  Avhere  the  member  sui- 
cided. It  was  contended  that  such  after-enacted  laws  were  ex  post 
facto,  that  they  diti  not  luar  upon  the  eontriict  but  only  as  to  the 
qualification,  and  the  discipline  of  the  society.  Answering  this  con- 
tention the  Court  said : 

"Orders  like  the  defendant  association  have  iu'dtii)lied  in  recent 
years.  They  are  organized  for  the  mutual  beiu^fit  of  the  members, 
taking  care  of  the  sick  and  afflicted  in  life  and  providing  for  the 
fiimily  of  the  deceased  memlier  after  death.  Rules  and  regulations, 
a  constitution  and  by-laws  are  enacted  for  their  government.   Every 


366  FRATERNAL   SOCIETY   LAW 

member  who  joins  one  of  these  orders  does  so  with  the  full  knowl- 
edge of  its  laws  and  usages.  He  is  bound  by  the  constitution  and 
by-laws  and  subjects  himself  to  their  discipline  in  order  to  receive 
the  benefits  conferred  by  the  order.  There  can  be  no  law  or  regula- 
tion enacted  after  his  membership  that  would  destroy  the  benefit 
agreed  to  be  conferred  upon  him  by  the  laws  and  regulations  in 
force  at  the  time  he  joined  the  order.  His  contract  of  insurance 
could  not  be  abridged  or  violated  without  his  consent,  but  provision 
is  made  in  the  constitution  for  its  amendment,  and  we  see  no  reason 
why  the  members  of  an  association  of  this  kind  cannot,  like  a  body 
politic,  change  its  laws,  enact  new  ones,  and  discipline  its  members 
b.y  police  regulations.  In  both  cases  the  members  by  their  vote,  par- 
ticipate in  the  change  bj^  the  nde  of  the  majority.  In  neither  case 
can  vested  rights  be  destroyed.  The  vested  right  that  the  deceased 
had  was  for  his  family  to  receive  the  sum  of  $3,000,  provided  he 
complied  with  the  laws  of  the  order.  There  was  no  vested  right 
in  selecting  the  mode  and  manner  of  his  death.  Had  there  been 
no  subsequent  legislation  there  would  have  been  no  prohibition  to 
the  payment,  but  the  order  had  the  right,  independent  of  any  stipu- 
lation or  agreement,  to  say  that  no  member  should  take  his  own 
life  and  receive  for  his  family  the  benefit  of  the  policy.  It  was  a 
matter  of  legislation  in  which  each  member,  through  representation, 
assented.  It  was  a  police  regulation  in  the  interest  of  the  disciplin  ■ 
and  welfare  of  the  endowment  rank." 

Daugherty   vs.   Knights   of  Pythias,   June,   1896,   48   La.   Ann.   1203; 
20  So.  E.  713;  55  Am.  St.  310. 

After-enacted  Suicide  Laws  Applicable  to  Outstanding  Contracts. 

A  certificate  issued  to  a  member  contained  among  other  things  the 
following  agreement, — 

"and  in  consideration  of  the  payment  hereafter  to  said  endowment 
rank  of  all  monthly  payments  as  required,  and  the  full  compliance 
with  all  the  laws  governing  this  rank  now  in  force  or  that  may  here- 
after be  enacted,  and  shall  be  in  good  standing  under  such  laws," 
etc. 

Subsequently  a  suicide  by-law  was  enacted,  and  thereafter  the 
holder  of  the  certificate  suicided.     In  considering  the  applicability 


THE   STATE    OF   LOUISIANA  ;567 

of  the  arter-eiiactrd  suicide  by-law  to  this  coiiti'uct,  tlie  court  said 
"in  the  certiticate  it  is  stated  that  if  any  of  the  requirements  of  thi' 
laws  in  force  governing  the  endowment  rank  sh^dl  be  violated,  the 
Supreme  Lodge  of  the  Order  shall  not  be  liable  for  the  amount  of 
the  policy.  The  certificate  covers  both  the  laws  which  may  there- 
after be  enacted  governing  the  endowment  rank,  and  the  good  stand- 
ing of  the  members  under  the  existing  regulations.  After  this  cer- 
tificate was  issued  to  F.  A.  Daugherty,  the  law  was  enacted  by  the 
proper  authority,  and  approved  by  the  Supreme  Lodge  forfeiting 
the  policy  on  account  of  suicide.  Any  law  enacted  in  pursiiance  of 
this  agreement  is  the  voluntary  consent  of  the  members  of  the  Order 
made  for  their  mutual  benefit  and  by  their  proper  representatives. 

Daugherty   vs.   Knights   of   Pythias,   June,    1S9G.   48   La.    Ann.   1203; 
20  So.  E.  713;   55  Am.  St.  310. 

Warranties  Versus  Representations. 

In  discussing  warranties  and  representations  and  the  distinctions 
sometimes  made  between  same,  the  court  said : 

"Whether  this  certificate  be  designated  a  warranty  or  a  repre- 
sentation, it  was  undoubtedly  a  matter  from  which  the  defendant 
was  to  decide  the  course  it  was  to  pursue  as  to  the  future.  *  *  * 
It  was  not  a  question  of  supposition  or  belief  to  which  it  was  asked 
to  certify,  but  a  matter  of  fact.  When  it  certified  to  something 
which  was  not  true  we  think  it  destroyed  a  basis  upon  which  the 
contract  was  granted." 

Winkler  vs.  Fidelity  and  Deposit  Co.,   Supreme  Court  of  La.,  June, 
1907,  44  So.  449. 

Warranty — Untrue  Answers  Avoid  Contract. 

A  contract  of  life  insurance  was  is.sued  December  3rd,  1903,  and 
twenty  days  later  the  assured  was  examined  by  two  physicians  who 
discovered  a  cavity  in  one  of  her  lungs,  the  assured  dying  February 
23rd,  1905.  For  several  years  prior  to  the  date  of  the  policy  the 
assured  had  suffered  from  a  chronic  cough  which  kept  growing 
worse  and  finally  developed  into  consumption.    The  court  said: 


368  FRATERNAL    SOCIETY    LAW 

"Ihe  discover.y  of  a  cavit.y  in  the  lung  twenty  days  after  she  was 
examined  for  insurance,  and  her  subsequent  death  from  consumption 
leave  little  doubt  in  the  lay  mind  that  she  had  that  dread  disease 
when  she  was  insured.  There  can  be  no  doubt  however  from  the 
evidence  that  she  had  been  suffering  from  a  chronic  and  persistent 
cough  for  several  years  antedating  her  application,  that  she  had 
at  the  time  either  bronchitis  or  consumption. " 

The  application  stated  that  the  answers  made  to  the  medical 
examiner  were  true  and  it  was  agreed  that  if  they  were  untrue  the 
contract  should  be  avoided.  In  the  answers  made  to  questions  asked 
in  the  medical  examination,  the  applicant  denied  that  she  was  suf- 
fering froni  consumption,  and  it  was  held  by  the  court  that  under 
the  facts  in  the  case,  the  answers  were  untrue  and  the  contract  was 
avoided. 

Bertrand   vs.   Franklin   Life   Ins.  Co.,   Supreme  Court  of  Louisiana, 
June,  1907;   44  So.  186. 


THE    STATE    OF    MAINE  369 


THE 

STATE  OF  MAINE. 


CHAPTER  20. 

(The  Section  uumbers  employed  correspond  to  those  in  Chapter  49, 
\l.  S.  of  Me.) 

Section  134.  A  fraternal' beneficiarj^  association  is  hereby  defined 
to  be  any  corporation,  society  or  voluntary  association,  formed  or 
organized  and  carried  on  for  the  sole  benefit  o^  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have 
a  lodge  system,  with  ritualistic  form  of  work  and  representative  form 
of  government,  and  shall  make  provision  for  the' payment  of  benefits 
in  case  of  death,  and  may  make  provision  for  the  payment  of  benefits 
in  the  case  of  sickness,  temporary  or  permanent  physical  disability, 
either  as  the  result  of  disease,  accident  or  old  age,  provided  the 
l)eriod  in  life  at  which  payment  of  physical  disability  benefits  on 
account  of  old  age  commences,  shall  not  be  under  seventy  years, 
sulijeet  to  their  compliance  with  its  constitution  and  laws.  The 
fund  from  which  the  payment  of  such  benefits  shall  be  made,  and 
tlie  fund  from  which  the  expenses  of  such  association  shall  be  de- 
frayed shall  be  derived  from  assessments  or  dues  collected  from  its 
members.  Payments  of  death  benefits  shall  be  to  the  families,  heirs, 
blood  relatives,  adopted  children,  adopting  parents,  affianced  hus- 
band or  affianced  wife  of,  or  to  persons  dependent  upon  the  member. 
Such  associations  shall  be  governed  by  the  last  twenty-four  sections 
of  this  chapter  and  shall  be  exempt  from  the  provisions  of  insurance 
laws  of  this  State,  except  as  therein  provided  and  no  law  passed 
after  March  twenty-one,  nineteen  hundred  and  one,  shall  apply  to 
them  unless  they  be  expressly  designated  therein.  Any  such  fra- 
24 


370  FRATERNAL    SOCIETY    LAW 

ternal  beneficiarj-  association  may  create,  maintaiu,  disburse  and 
apply  a  reserve  or  emergency  fund  in  accordance  with  its  consti- 
tution or  by-laws. 

Section  135.  Seven  or  more  persons,  residents  of  the  State,  desh-- 
ing  to  form  a  fraternal  beneficiary  corporation  for  the  purposes 
above  provided,  and  having  signed  an  agreement  therefor,  declaring 
therein  the  jjurposes  of  such  corporation,  may  organize  as  such  in 
the  manner  provided  in  sections  one,  two  and  three  of  chapter  fifty- 
seven,  and  such  corporation  shall  have  all  the  powers,  privileges  and 
immunities,  and  be  subject  to  all  the  liabilities  named  in  said  section 
three. 

Section  136.  The  president,  secretary,  and  a  majority  of  the 
directors,  or  other  officers  corresponding  thereto,  shall  forthwith 
make,  sign  and  swear  to  a  certificate  setting  forth  a  true  copy  of 
the  agreement  and  declaration  of  the  purposes  of  the  association, 
with  the  names  of  the  subscribers  thereto,  the  date  of  the  first 
meeting,  and  the  successive  adjournments,  if  any,  and  shall  sub- 
mit such  certificate  and  the  records  of  the  corporation  to  the  insur- 
ance commissioner,  who  shall  make  such  examination  and  require 
such  evidence  as  he  deems  necessary;  and  if  it  appears  that  the  pur- 
poses of  the  corporation  conform  to  laAv.  he  shall  certify  his  approval 
thereof,  and  the  certificate  shall  then  be  filed  by  said  officer  in  the 
office  of  the  secretary  of  State,  who  shall  cause  the  same  with  the 
indorsements,  to  be  recorded,  and  shall  thereupon  issue  a  certificate 
in  the  following  form : 

"STATE  OF  MAINE. 

Be  it  known  that  whereas"  (here  the  names  of  the  subscribers 
to  the  agreement  of  the  association  shall  be  inserted),  "have  asso- 
ciated themselves  with  the  intention  of  forming  a  corporation  under 
the  name  of"  (here  the  name  of  the  corporation  shall  be  inserted) 
"for  the  purpose"  (here  the  purpose  declared  in  the  agreement  of 
association  shall  be  inserted),  "and  hace  complied  with  the  provi- 
sions of  the  statutes  of  this  State  in  such  ease  made  and  provided, 
as  appears  from  the  certificate  of  the  officers  of  the  corporation, 
duly  approved  by  the  insurance  commissioner  and  recorded  in  this 
office:    Now,  therefore,  I"  (here  the  name  of  the  secretary  shall  be 


THE    STATE    OF    MAINE  371 

inserted),  "Secretary  of  tlic  State  of  Maine,  do  liereby  certify  tliat 
said"  (here  the  names  of  the  subscribers  to  the  agreement  of  asso- 
ciation shall  be  inserted),  "their  associates  and  successors,  are 
legally  organized  and  established  as  and  are  hereby  made  an  exist- 
ing corporation  under  the  name  of"  (here  the  name  of  the  corpora- 
tion shall  be  inserted),  "with  the  powers,  rights  and  privileges,  and 
subject  to  the  limitations,  duties  and  restrictions  which  by  law  apper- 
tain thereto.  Witness  my  official  signature  hereunto  subscribed,  and 
the  seal  of  the  State  of  Maine  hereunto  aifixed,  this  day  of 

in  the  year  "  (day,  month  and  year  inserted). 

The  secretai-y  shall  sign  the  same  and  cause  the  seal  of  the  State 
to  be  thereto  affixed,  and  such  certificates  shall  be  conclusive  evi- 
dence of  the  existence  of  such  corporation  at  the  date  of  such  certifi- 
cate. He  shall  cause  a  record  of  such  certificate  to  be  made,  and  a 
certified  copy  of  such  record  may  be  given  in  evidence,  with  like 
effect  as  the  original  certificate. 

Section  137.  No  charter  granted  under  the  provisions  of  the 
two  preceding  sections  shall  be  valid  after  one  year  from  its  date 
unless  the  organization  has  been  completed  and  business  begun 
thereunder,  and  when  any  domestic  corporation  has  discontinued 
business  for  the  period  of  one  year  its  charter  shall  become  null  and 
void. 

Section  138.  Any  fraternal  beneficiary  corporation  existing  ixnder 
the  laws  of  this  State,  and  engaged  in  transacting  business  herein 
on  March  twenty-one,  nineteen  hundred  and  one,  may  reincorporate 
under  the  foregoing  provisions ;  provided,  that  nothing  herein  con- 
tained shall  be  construed  as  requiring  any  such  corporation  to  rein- 
corporate ;  and  any  such  corporation  may  continiie  to  exercise  all  the 
rights,  powers  and  privileges  conferred  by  the  last  twenty-four  sec- 
tions of  this  chapter,  and  its  articles  of  incorporation  not  inconsistent 
herewith,  and  shall  be  subject  to  the  requirements  and  penalties  of 
said  sections  the  same  as  if  reincorporated  thereunder. 

Section  139.  No  association  hereafter  organized  under  the  pro- 
visions of  sections  one  hundred  thirty-five  and  one  hundred  thii-ty- 
six  shall  incur  any  liability  or  issue  any  benefit  certificate  until  it 
has  received  from  the  insurance  commissioner  a  certificate  to  the 
effect  that  it  has  complied  with  the  reqiiirements  of  law  and  is  duly 
authorized  to  transact  business  in  this  State.    Before  such  certificate 


372  FRATERNAL    SOCIETY    LAW 

is  granted  the  association  must  present  satisfactorj^  evidence  to  the 
insurance  commissioner  that  it  has  established  mortuary  assessment 
rates  which  are  not  lower  than  those  now  indicated  as  necessary  by 
the  National  Fraternal  Congress  Mortality  Tables  and  that  at  least 
five  luiudred  pei-sons  have  each  paid  one  advance  mortuary  assess- 
ment on  the  rates  so  established  and  become  a  bona  fide  member  of 
a  local  branch  of  the  association,  and  that  it  has  deposited  with  the 
treasurer  of  State  at  least  one  thousand  dollars  as  a  part  of  its 
emergency  or  reserve  fund  for  the  benefit  and  protection  of  certifi- 
cate holders  in  said  association,  which  fund  shall  be  held  and  used 
as  hereinafter  provided. 

Section  140.  Each  such  association  organized  under  the  foregoing 
provisions,  after  March  twenty-one,  nineteen  hundred  and  one,  shall, 
on  or  before  the  thirty-first  day  of  December  in  each  j^ear  deposit 
with  the  treasurer  of  State  to  the  credit  of  its  emergency  or  reserve 
fund  not  less  than  fifteen  per  cent,  of  its  total  mortuary  receipts 
for  the  year  then  ending,  until  the  amount  to  deposited  amounts 
to  not  less  than  fifty  thousand  dollars.  These  amounts  shall 
be  deposited  in  such  interest  bearing  securities  as  any  insurance 
company  or  savings  bank  may  fi'om  time  to  time  by  law  invest  its 
funds  in,  and  the  securities  shall  be  held  in  trust  by  the  treasurer  of 
state,  but  the  association  shall  have  at  all  times  the  right  to  exchange 
any  part  of  said  securities  for  others  of  like  amount  and  character, 
and  the  income  from  said  fund  shall  be  paid  by  said  treasurer  to  the 
association.  When  deemed  advisable  by  the  majority  of  the  direc- 
tors, or  other  officers  corresponding  thereto,  such  part  of  the  fund  as 
may  be  considered  necessary,  may  with  the  written  approval  ol' 
the  insurance  commissioner,  be  applied  from  time  to  time  to  the 
payment  of  death  benefits  but  for  no  other  purpose;  provided,  hew- 
ever,  tliat  such  fund  shall  not  at  any  time  be  reduced  below  an 
amount  equal  to  one  assessment  or  periodical  call  upon  all  of  its 
members,  nor  to  less  than  one  thousand  dollars.  The  insurance  com- 
missioner shall  annually,  in  February,  certify  to  the  treasurer  of 
State,  the  minimum  amount  of  reserve  fund  required  to  be  kept  on 
deposit  in  the  treasurj'-  by  each  such  association  doing  business  under 
this  chapter.  If  said  association  shall  neglect  for  sixty  days  to 
satisfy  any  judgment  against  it,  in  any  court  in  this  State,  then  Ihr 


THE    STATE    OF   MAINE  ;:57;j 

said  treasurer  shall  convert  into  money  any  of  said  securities,  :mil 
forthwith  satisfy  such  judgment,  and  said  association  shall  not  trans- 
act any  further  business  until  said  deposit  is  restored.  When  any 
such  association  shall  discontinue  business,  any  justice  of  the  su- 
preme judicial  court  may  appoint  a  receiver  or  agent  to  administer 
any  unexhausted  portion  of  such  fund  which  shall  be  used,  less 
compensation  not  to  exceed  five  per  cent.,  as  such  court  or  justice 
may  allow  the  receiver  or  agent;  first,  in  the  payment  of  accrued, 
mortuary  or  indemnity  claims  upon  certificates  or  policies,  or  if  in- 
sufficient to  pay  such  claims  in  full,  they  shall  be  paid  pro  rata; 
second,  if  a  balance  remains  after  the  payment  of  such  claims,  such 
balance  to  be  distributed  to  the  holders  of  certificates  then  in  force, 
pro  rata,  in  accordance  with  the  total  mortuary  payments  of  said 
members,  after  first  paying  all  expenses  incident  to  such  distribu- 
tion. If,  upon  the  thirty-first  day  of  December  of  any  year,  the 
emergency  or  reserve  fund  of  any  such  association  is  found  to  be 
less  than  the  amount  of  one  assessment  or  periodical  call  upon  all 
the  members  thereof,  said  association  shall,  within  six  months  there- 
after, collect  from  its  members  a  sum  sufficient  to  bring  said  emer- 
gency or  reserve  fund  up  to  one  assessment  or  periodical  call  upon  all 
its  members,  and  deposit  the  amount  with  the  treasurer  of  State  to 
the  credit  of  said  fund. 

Section  141.  No  such  association  shall  reinsure  with  or  transfer 
its  membership  certificates  or  funds  to  any  organization,  unless  the 
,  said  contract  of  transfer  or  reinsurance  is  first  submitted  to  and 
approved  by  a  two-thirds  vote  of  the  members  of  each  association 
present  at  meetings  called  to  consider  the  same,  of  which  meetings 
written  or  printed  notice  shall  be  mailed  to  each  certificate  holder  at 
least  thirty  days  before  the  date  fixed  for  said  meeting,  nor  unless 
the  said  contract  of  transfer  or  reinsurance  is  first  submitted  to  and 
approved  by  the  insurance  commissioner.  The  members  of  fraternal 
beneficiary  associations  shall  not  vote  by  proxy. 

Section  142.  Fraternal  beneficiary  associations  organized  under 
the  laws  of  another  State  or  country  which  were  transacting  busi- 
ness in  this  State  as  herein  defined,  on  the  twenty-eighth  day 
of  February,  eighteen  hundred  and  eighty-nine,  or  which  sub- 
sequently   thereto    have  been    legally    admitted    to    transact    Inisi- 


374  FRATERNAL    SOCIETY    LAW 

ness  in  this  State  and  which  now  report  or  which  shall  report 
when  requested  to  the  insurance  commissioner,  may  continue  such 
business  subject  to  the  provisions  of  the  last  twenty-four  sec- 
tions of  this  chapter.  A  fraternal  beneficiary  association  which 
was  not  transacting  business  in  this  State  on  the  twenty-eighth  day 
of  February,  eighteen  hundred  and  eighty -nine,  and  which  has  not 
since  been  legally  admitted  to  transact  business  therein  and  which 
may  after  March  twentj^-one,  nineteen  hundred  and  one,  desire  to  do 
so,  shall  first  obtain  a  license  therefor  from  the  insurance  commis- 
sioner. Before  receiving  such  license  it  shall  file  with  the  commis- 
sioner a  duly  certified  copy  of  its  charter  or  articles  of  association 
and  a  copy  of  its  constitution  or  laws,  certified  by  its  secretary  or 
corresponding  officer,  a  power  of  attorney  to  the  commissioner,  as 
hereinafter  provided;  a  statement  under  oath  of  the  president  and 
secretary,  or  corresponding  officers,  in  the  form  required  by  the 
commissioner,  of  its  business  for  the  preceding  year;  a  certificate 
from  the  proper  official  in  its  home  State  or  country,  that  the  com- 
pany is  legally  organized  and  that  similar  associations  of  this  State 
may  be  admitted  to  transact  business  in  said  State  or  country;  a 
copy  of  its  application  and  policy  or  certificate,  which  must  show 
that  benefits  are  provided  for  by  assessments  upon  persons  holding 
similar  contracts,  and  shall  furnish  the  commissioner  with  such 
other  information  as  he  may  deem  necessary  to  a  proper  exhibit 
of  its  business  and  standing  and  plan  of  working,  and  if  he  deems 
it  expedient  he  may  license  such  association  to  do  business  in  this 
State  in  accordance  with  the  provisions  of  this  chapter;  provided, 
however,  that  no  license  shall  be  issued  to  any  such  company  unless 
it  shall  have  adopted  and  have  in  force  mortuary  assessment  rates 
which  are  not  lower  than  those  now  indicated  as  necessary  by  the 
National  Fraternal  Congress  Mortality  Tables. 

Section  143.  Each  such  association  which,  on  March  twent.v-one, 
nineteen  hundred  and  one,  was  doing  or  was  thereafter  admitted 
to  do,  busine.ss  within  Hi  is  State,  and  not  having  its  principal  office 
within  this  State,  and  not  being  organized  iinder  the  laws  of  this 
State,  shall  appoint  in  writing  the  insurance  commissioner  and  his 
successors  in  office  to  be  its  true  and  lawful  attorney,  U|)nn  whom  all 
lawful  process  in  any  action  or  proceeding  against  it  shall  be  served, 


THE    STATE    OF    MAINE  375 

and  in  such  writing  shiill  agree  tliiit  any  lawful  process  against  it 
which  is  served  on  said  attorney  shall  be  of  the  same  legal  force  and 
validity  as  if  served  upon  the  association,  iind  that  the  authority 
shall  continue  in  force  so  long  as  any  liability  remains  outstanding 
in  this  State.  Copies  of  such  appointment,  certified  by  said  insurance 
commissioner,  shall  be  deemed  sufiicient  evidence  thereof,  and  shall 
be  admitted  in  evidence  with  the  same  force  and  effect  as  the 
original  thereof  might  be  admitted.  Service  upon  such  attorney 
shall  be  deemed  sufficient  service  upon  such  association.  When  legal 
process  against  any  such  association  is  served  upon  said  insurance 
commissioner,  he  shall  immediately  notify  the  association  of  such 
service  by  letter,  prepaid  and  directed  to  its  secretary  or  correspond- 
ing officer,  and  shall  within  two  days  after  such  service  forward  in 
the  same  manner  a  copy  of  the  process  served  on  him  to  such  oiScer. 

Section  144.  No  cei'tificate  issued  by  any  such  association  trans- 
acting business  under  this  chapter  shall  be  valid  or  legal  which  shall 
be  conditional  upon  an  agreement  or  understanding  that  the  benefi- 
ciai'y  shall  pay  the  dues  and  assessments,  or  either  of  them  for  said 
member.  Every  call  for  a  jjayment  by  the  policy  or  certiiicate 
holders  shall  distinctly  state  the  purpose  of  the  same.  No  part  of 
the  money  collected  for  mortuary  or  indemnity  purposes  or  for  the 
emergency  or  reserve  fund  shall  be  used  for  expenses ;  provided, 
that  any  such  association  transacting  business  in  this  State  on  IMarch 
twenty-one,  nineteen  hundred  and  one,  and  whose  laws  provide  for 
and  which  is  now  using  such  funds  for  expenses,  may  continue  to  do 
so,  but  not  to  exceed  the  amount  named  for  that  ])urpose  in  such 
existing  laws. 

Section  145.  Any  association  authorized  to  transact  business  as 
defined  in  the  last  twenty-four  sections  of  this  chapter,  may  employ 
paid  agents  in  soliciting  business  but  no  person  shall  act  as  such 
agent  until  the  association  or  its  authorized  manager  has  filed  with 
the  insurance  commissioner  a  certificate  certifying  that  such  person 
has  been  appointed  as  the  agent  of  the  association.  Upon  receiving 
such  certificate  the  commissioner  may  issue  a  license  to  such  person, 
authorizing  him  to  transact  business  in  this  State  in  accordance  with 
the  provisions  of  said  sections  and  such  license  shall  expire  on  the 
first  dav  of  the  next  Julv,  but  no  license  shall  be  issued  under  the 


376  FRATERNAL    SOCIETY    LAW 

provisions  of  this  section  to  firms  or  corporations.  If  any  person 
acts  as  such  agent  without  first  receiving  such  license,  or  fraudu- 
lently assumes  to  be  an  agent  and  solicits  or  procures  risks  or 
receives  money  for  premiums  or  assessments,  he  forfeits  not  less 
than  fifty  dollars  nor  more  than  one  hundred  dollars  for  each  ofl'ense, 
but  anj'  policy  or  certificate  issued  on  such  application  binds  the 
association,  if  otherwise  valid. 

Section  146.  Any  person  who  shall  solicit  membership  for,  or  in 
any  manner  assist  in  procuring  membership  in  any  such  association 
doing  business  not  authorized  by  sections  one  hundred  and  thirty- 
four  to  one  hundred  and  fifty-seven  inclusive,  or  who  shall  solicit 
membership  for,  or  in  any  manner  assist  in  procuring  membership 
in  any  such  association  not  authorized,  as  herein  provided,  to  do 
business  as  therein  defined,  in  this  State,  shall  be  punished  by  a  fine 
of  not  less  than  fiftj'^,  nor  more  than  two  hundred  dollars. 

Section  147.  Every  association  doing  business  as  a  fraternal 
beneficiary  a.ssociation  as  herein  defined  shall  annually,  on  or  before 
the  first  day  of  March,  report  to  the  insurance  commissioner  the 
names  and  addresses  of  its  president,  secretary  and  treasurer,  or 
other  officers  corresponding  thereto,  and  shall  make  under  oath  such 
further  statements  of  its  membership  and  financial  transactions  for 
the  year  ending  on  the  preceding  thirty-first  day  of  December,  with 
other  information  relating  thereto,  as  said  commissioner  may  deem 
necessary  to  a  proper  exhibit  of  its  business  and  standing ;  and  the 
commissioner  may  at  any  other  times  require  any  further  statement 
he  may  deem  necessary  to  be  made  relating  to  such  association. 
Anj'  such  association  wliich  neglects  or  refuses  to  make  the  returns 
required  by  this  section  shall  forfeit  five  dollars  a  day  for  each  day's 
neglect;  and  for  wilfully  making  a  false  statement,  the  association 
and  the  persons  making  oath  thereto,  or  subscribing  the  same,  shall 
severally  be  i)unished  by  a  fine  of  not  less  than  one  hundred,  nor 
more  than  five  hundred  dollars. 

Section  148.  The  money  or  other  benefit,  charity,  relief  or  aid  to 
be  paid,  provided  or  rendered,  or  which  has  been  paid,  provided  or 
rendered  l)y  any  fraternal  beneficiary  association  authorized  to  do 
business  under  this  chapter,  and  as  heretofore  provided,  shall  not 
!)('  lialiJr  III  attachment  by  trustee,  or  otbri-  process,  and  sliall  not  be 


THE    STATE    OE    MAINE  377 

seized,  taken  (ii-  appniin-iuted,  or  applied  by  any  legal  or  equitable 
process,  nor  1>.\-  operation  of  law,  to  pay  any  debt  or  liability  oi'  a 
certificate  holder,  oi-  any  beneficiary  thereof,  existing  ;it  the  death  of 
such  holder;  provided  that  the  foregoing  provisions  shall  not  apply 
to  debts  contracted  for  the  purpose  of  paying  assessments  or  dues 
in  order  to  keep  such  certificates  in  force. 

Section  1-1:9.  Any  solicitor,  agent  or  examining  physician,  who 
shall  knowingly  or  wilfully  make  any  false  or  fraudulent  statement 
or  representation  in  or  with  reference  to  any  application  for  mem- 
bership, or  for  the  purpose  of  obtaining  any  money  or  benefit,  in  any 
such  association  transacting  business  under  this  chapter,  shall  be 
punished  by  a  fine  of  not  less  than  one  hundred,  nor  more  than  five 
hundred  dollars,  or  by  imprisonment  not  less  than  thirty  days  nor 
more  than  one  year ;  and  any  person  who  shall  wilfully  make  a  false 
statement  of  any  material  fact  or  thing  in  a  sworn  statement  as  to 
the  death  or  disability  of  a  certificate  holder  in  any  such  association, 
for  the  purpose  of  procuring  the  payment  of  the  benefit  named  in 
the  certificate  of  such  holder,  shall  be  guilty  of  perjury,  and  upon 
conviction,  shall  be  punished  accordingly. 

Section  150.  Nothing  contained  in  the  last  twenty-four  sections 
of  this  chapter  shall  be  construed  to  affect  or  apply  to  grand  or 
subordinate  lodges  of  Masons,  Odd  Fellows,  Knights  of  Pythias  or 
similar  orders,  organized  or  incorporated  under  the  laws  of  this 
State,  and  which  do  not  have  as  their  principal  object  the  issuance 
of  insurance  certificates.  Nor  shall  anything  therein  contained  apply 
to  domestic  corporations  or  voluntary  associations  which  limit  their 
membership  to  the  employees  of  a  particular  city  or  town,  designated 
firm,  business  house  or  corporation ;  nor  to  domestic  lodges,  orders 
or  associations  of  a  purely  religious,  charitable  and  benevolent  de- 
scription which  do  not  operate  with  a  view  to  profit  and  which  do 
not  provide  for  a  funeral  benefit  or  more  than  one  hundred  dollars, 
or  sick  or  disability  benefits  of  more  than  one  hundred  and  fifty 
dollars,  to  any  one  person  in  any  one  year.  Provided  always,  that 
any  association  which  has  more  than  three  hundred  members  and 
which  issues  to  any  person  a  certificate  providing  for  the  payment  of 
benefits  shall  not  be  exempt  by  the  provisions  of  this  section,  and 
such  associations  shall  comply  with  all  requirements  of  this  chapter 


378  FRATERNAL    SOCIETY    LAW 

relating  to  frali-iual  beneficiary  associations.  The  insurance  com- 
missioner may  require  of  anj-  association  such  information  relating 
to  its  membership  and  certificates  as  will  enable  him  to  determine 
whether  it  is  exempt  from  the  provisions  hereof.  And  no  associa- 
tion which  is  exempt  by  the  provisions  of  this  section  from  the  re- 
quirements hereof,  shall  employ  paid  agents  or  give  or  allow  to  any 
person  any  compensation  for  procuring  new  members. 

Section  151.  The  insurance  commissioner,  in  person  or  by  deputy, 
shall  have  the  power  of  visitation  and  examination  into  the  affairs 
of  any  domestic  association  subject  to  the  provisions  of  this  chapter 
relating  to  fraternal  beneficiary  associations,  that  are  conferred 
upon  him  hy  the  provisions  of  this  chapter,  provided,  that  he  shall 
not  be  required  to  make  periodical  examinations  of  domestic  associa- 
tions. Whenever  after  examination  the  commissioner  is  satisfied 
that  any  domestic  association  is  not  paying  the  maximum  amount 
named  in  its  policies  or  certificates  in  full  or  is  in  such  condition  as 
to  render  further  proceedings  hazardous  to  the  public  or  its  policy- 
holders or  is  transacting  its  business  fraudulently ;  or  whenever  such 
domestic  association  shall,  after  the  existence  of  one  year  or  more, 
have  a  membership  of  less  than  three  hundred,  the  insurance  com- 
missioner may  present  the  facts  in  relation  to  the  same  to  any  justice 
of  the  supreme  judicial  court ;  and  said  justice  shall  thereupon  notify 
the  officers  of  such  association  of  a  hearing  and  unless  it  shall  then 
appear  that  some  special  and  good  reason  exists  why  the  associa- 
tion should  not  be  closed,  some  person  sliall  be  appointed  receiver 
of  such  association  and  shall  proceed  at  once  to  take  possession  of 
the  l)ooks,  pa])ei's,  moneys  and  other  assets  of  the  association,  and 
shall  forthwitli,  under  the  direction  of  the  court  proceed  to  close  the 
afi'airs  of  such  association  and  to  distribute  to  those  entitled  thereto 
its  funds  in  the  manner  provided  in  section  one  hundred  and  forty. 
For  this  service  the  receiver  may  be  allowed  out  of  any  funds  in 
possession  of  the  association  or  which  may  come  therefrom  into  his 
hands,  such  sum  as  the  court  may  determine  to  be  reasonable  and 
just.  When  the  affairs  of  the  association  .shall  be  finally  closed,  the 
court  shall  decree  a  dissolution  of  the  same. 

Section  152.  Fi'aternal  beneficiary  associations,  organized  or  in- 
corporated under  the   laws  of  this  State,   which   were  transacting 


THE    STATE    OF    MAINE  379 

business  herein  on  March  twonty-ono,  nineteen  hundred  and  one, 
and  which  limit  their  membership  to  the  members  of  some  particular 
order,  class  or  fraternity  may  continue. such  business  by  complying 
with  the  jjrovisions  hereof  not  inconsistent  therewith. 

Section  153.  Whenever  the  commissioner  deems  it  prudent  for 
the  protection  of  the  policy  or  certificate  holders  in  this  State  he, 
or  any  person  whom  he  may  appoint,  may  examine  any  foreign 
fraternal  beneficiary  association  applying  for  admission  or  trans- 
acting business  in  this  State  and  such  association  shall  pay  the  ex- 
penses of  the  examination.  The  commissioner  may  employ  assistants 
and  for  the  purposes  aforesaid  he,  or  any  person  he  may  appoint, 
shall  have  free  access  to  all  the  books  and  papers  that  relate  to  the 
l)usiness  of  such  association  and  to  the  books  and  papers  kept  by 
an.y  of  its  organizers  and  may  summon  and  qualify  as  witnesses 
under  oath,  and  examine  the  directors,  officers,  agents,  organizers 
and  trustees  of  such  association  and  other  persons  in  relation  to  its 
aft'airs,  transactions  and  condition.  He  may  accept  in  lieu  of  such 
examination  the  examination  of  the  insurance  department  of  the 
state  or  country  where  such  foreign  association  is  organized. 

If  anj'  such  association,  or  its  officers  or  agents,  refuse  to  submit 
to  such  examination  or  to  comply  with  the  provisions  of  this  section 
relating  thereto,  the  authority  of  such  association  to  transact  busi- 
ness in  this  State  shall  lie  suspended  until  satisfactory  evidence  is 
furnished  the  commissioner  relating  to  the  .standing  and  affairs  of 
the  association,  and  during  such  suspension  the  association  shall  not 
transact  any  business  in  this  State. 

When  the  commissioner,  on  investigation,  is  satisfied  that  any 
association  organized  under  the  laws  of  another  State  or  country 
and  transacting  business  iinder  the  last  twenty-four  sections  of 
this  chapter  has  exceeded  its  powers,  or  has  failed  to  comply  with 
an.y  provision  of  law,  or  is  conducting  business  fraudulentl.y,  or  that 
its  condition  is  such  as  to  render  further  proceedings  hazardous  to 
the  public  or  to  its  certificate  holders,  or  in  case  any  such  association 
shall  vote  to  discontinue  its  business,  he  shall  notify  the  president 
and  secretary,  or  other  officers  corresponding  thereto  of  his  findings, 
and  state  the  grounds  of  his  dissatisfaction  and  after  thirty  days' 
notice  require  said  association,  on  a  date  named,  to  show  cause  why 


3y0  FRATERNAL    SOCIETY    LAW 

its  license  should  not  be  revoked  and  its  authority  to  transact  busi- 
ness in  this  State  terminated.  If  on  the  date  named  in  said  notice 
such  objections  have  not  been  removed  to  the  satisfaction  of  the 
commissioner,  or  the  association  does  not  present  good  and  sufficient 
reasons  why  its  authority  to  transact  business  in  this  State  should 
not  at  that  time  be  revoked,  he  may  revoke  the  authority  of  such 
association  to  continue  business  in  this  State. 

"When  the  commissioner  suspends  or  revokes  the  authority  of  any 
association  to  contiue  business  in  this  State,  or  on  application  refuses 
to  countermand  such  suspen.sion  or  revocation  the  association  may 
within  thirty  days  apply  to  any  justice  of  the  supreme  judicial  court, 
by  presenting  to  him  a  petition  therefor,  in  term  time  or  vacation, 
and  he  shall  fix  a  time  and  place  of  hearing  which  may  be  at  cham- 
bers and  in  vacation,  and  cause  notice  thereof  and  a  copy  of  said 
petition  to  be  served  on  the  commissioner,  and  after  said  hearing  he 
may  affirm  or  reverse  the  decision  of  the  commissioner  and  the 
decision  of  such  justice  shall  be  final. 

Section  15-t.  No  association  organized  or  doing  business  under 
the  last  twenty-four  sections  of  this  chapter  shall  issue  any  policy  or 
certificate  upon  the  life  of  any  person  more  than  sixty  years  of  age: 
nor  on  the  life  of  any  person  who  has  not  been  examined  by  a  re- 
putable, practicing  physician  and  passed  a  satisfactory  medical  ex- 
amination. No  person  shall  be  admitted  to  membership  in  any  such 
organization  unless  he  has  first  filed  an  application  with  and  been 
initiated  in  and  becomes  a  member  of  a  local  branch.  The  by-laws 
of  such  association  shall  provide  that  meetings  of  such  branches 
shall  be  held  at  least  once  each  month. 

Section  155.  When  the  laws  of  any  State  or  country  under  whicli 
any  such  association  is  organized  or  incorporated  impose  on  fraternal 
associations  of  this  State  any  additional  or  greater  fees,  fines,  penal- 
ties, prohibitions  or  obligations  than  are  imposed  hereby  upon  similar 
associations  of  other  States  or  coiuitries.  the  same  fees,  fines,  penal- 
ties, prohibitions  or  obligations  shall  be  imposed  upon  the  associa- 
tions of  such  State  or  country  applying  for  admission  or  transacting 
business  in  this  State. 

Section  If)!).  Any  association  neglecting  or  refusing  to  comply 
with,  or  \-iiiliiting  Ihc  pnivisioiis  hereof  relating  to  fraternal  benefi- 


THE    STATE    OF    MAINE  381 

ciary  associatidiis.  shall  Ix.'  fined  iiol  cxccciling-  two  hundred  dollars 
upon  conviction  thci-tMil'.  I'rosucutiOns  for  such  violations  may  be 
coiumeuced  by  eonii)laint  and  warrant  before  any  municipal  or  police 
judge  or  trial  justice  as  in  the  case  of  other  offenses  not  within  the 
final  jurisdiction  of  such  judge  or  justice,  as  i)rovided  in  section 
live  of  cha})ter  one  hundred  and  thirty-three. 

Section  157.  The  word  "association"  as  used  in  the  twenty-  three 
preceding  sections  shall  be  taken  and  construed  as  meaning  a  cor- 
poration, society  or  voluntary  association. 

Section  158.  Fraternal  beneficiary  associations  transacting  busi- 
ness in  this  State  on  the  twenty-eighth  day  of  February,  eighteen 
hundred  and  eighty-nine,  as  heretofore  defined  and  named  in  section 
one  hundred  and  forty-two  of  this  chapter,  shall  be  construed  to 
include  those  so  transacting  business  through  their  supreme  bodies, 
or  by  a  subordinate  body,  or  by  one  affiliated  therewith  or  rendering 
allegiance  thereto,  or  by  an  organization  embracing  a  portion  of 
the  territory  of  any  such  association  and  at  that  time  or  subsequent 
thereto  contributing  to  its  funds,  or  by  one  using  its  ritualistic  work 
and  calling  its  members  b.y  the  same  general  name;  and  no  change 
since  that  time  or  hereafter,  in  the  internal  divisions  or  operations 
of  any  such  association,  or  its  relations  with  subordinate  bodies, 
shall  deprive  it  of  the  power  to  so  transact  business  through  its 
supreme  body  and  subordinate  and  affiliated  divisions  or  agents,  or 
to  prevent  such  subordinate  or  affiliated  bodies  from  doing  business, 
so  long  as  death  benefits  are  paid,  and  they  shall  be  considered  as 
legally  organized  and  duly  authorized  for  such  purpose  under  the 
provisions  hereof  and  may  transact  business  in  this  State  as  inde- 
pendent bodies  only  in  the  event  that  said  supreme  body  shall  cease 
to  transact  business  herein. 

An  Act  additional  to  Chapter  forty-nine  of  the  Revised  Stitutes, 
relating  to  Insurance. 

Section  1.  Any  association  organized  or  incorporated  under  the 
laws  of  another  State  or  country  as  a  fraternal  beneficiary  associa- 
tion and  which  does  not  conduct  its  business  upon  the  lodge  system 
with  a  ritualistic  form  of  work  and  a  representative  form  of  govern- 
ment, in  accordance  with  the  provisions  of  section  one  hundred  and 


382  FBATEEXAL    SOCIETY    LAW 

thirty-four  of  chapter  forty-nine  of  the  revised  statutes,  and  which 
is  not  subject  to  the  statutes  of  this  State  regulating  fraternal  benefi- 
ciary associations,  but  which  confines  its  membership  to  the  members 
of  some  particular  order,  class  or  fraternity,  and  which  has  the  mem- 
bership and  qualifications  herein  required,  may  be  licensed  by  the 
insurance  commissioner  to  transact  the  business  of  casualty  insur- 
ance on  the  assessment  plan  and  to  provide  for  the  payment  of  death 
or  funeral  benefits  of  not  exceeding  one  hundred  dollars  to  the 
beneficiaries  of  deceased  members,  subject  to  and  in  accordance  with 
the  provisions  of  this  act. 

Section  2.  No  such  association  shall  transact  any  business  in  this 
State  without  a  license  from  the  insurance  commissioner.  Before 
receiving  such  license  it  shall  file  with  the  commissioner  a  duly 
certified  copy  of  its  charter  or  articles  of  association ;  a  copy  of  its 
constitution  and  by-laws  certified  by  its  secretary;  a  power  of  at- 
torney to  the  commissioner  as  provided  by  section  one  hundred 
fortj'-three  of  chapter  forty-nine ;  a  statement  under  oath  of  its 
president  and  secretary,  in  the  form  required  bj'  the  commissioner, 
duly  verified  by  an  examination  made  in  accordance  with  the  pro- 
visions of  section  one  hundred  fifty-three  of  chapter  forty-nine  of 
its  business  for  the  preceding  .year,  which  statement  and  examination 
must  show  that  the  association  had  at  least  five  thousand  members 
in  good  standing  at  the  date  of  such  report,  and  that  it  had  on  that 
date  available  assets  in  excess  of  all  known  liabilities  of  not  less  than 
twenty  thousand  dollars;  a  copy  of  its  policy  and  application  which 
must  show  that  benefits  are  provided  for  by  assessments  upon  or 
other  payments  by  persons  holding  similar  contracts,  a  certificate  of 
deposit  from  the  State  treasurer  of  this  State  as  hereinafter  provided, 
and  shall  furnish  the  insurance  commissioner  with  such  further  infor- 
mation cs  he  may  deem  necessary  to  a  proper  exhibit  of  its  business 
and  plan  of  working.  Upon  compliance  with  the  foregoing  provisions 
the  commissioner  may  license  such  association  to  transact  busi- 
ness in  this  State  as  herein  defined  until  the  first  day  of  the  succeed- 
ing July,  and  such  license  may  thereafter  be  renewed  annually,  but 
in  all  cases  to  terminate  on  the  first  day  of  the  next  succeeding  July. 
The  provisions  of  sections  one  hundred  and  twenty-nine,  one  hundred 
and  forty-three,  one  hundred  and  forty-five,  one  hundred  and  forty- 


THE    STATE    OF    MAINE  383 

seven,  one  huiiilrcd  juul  I'orty-eiyht,  one  Imndn'd  mid  i'i)rty-iiiijc  and 
(ine  liundi'ed  and  tit'ty-three  of  chapter  forty-uine  shall  ajiply  to  such 
associations. 

Section  3.  No  license  shall  lie  issued  to  any  such  association  until 
it  has  deposited  with  the  State  treasurer  of  this  State  securities 
which  are  a  legal  investment  for  savings  banks  of  this  State  amount- 
ing to  not  less  than  the  maximum  policy  issued  by  such  association 
nor  to  less  than  one  thousand  dollars.  '1  he  St;ite  treasurer  shall 
receive  such  securities  and  hold  the  same  on  deposit  and  in  trust  for 
the  benefit  of  all  the  policy  holders  of  the  a.ssociation  in  this  State, 
and  shall  receipt  for  and  hold  the  same  in  the  manner  provided  in 
sections  sixty  and  sixty-one  of  said  chapter  forty -nine,  but  he  shall 
retain  and  hold  the  same  as  long  as  any  liability  remains  outstanding 
in  this  State.  Whenever  any  judgment  obtained  in  a  court  of  com- 
petent jurisdiction  in  this  State,  by  a  policy  holder  or  any  beneficiary 
thereof,  remains  unsatisfied  for  more  than  sixty  days  after  legal 
demand  upon  the  association,  and  no  appeal  from  the  decision  of  said 
court  is  pending,  said  court  may  issue  an  order  directing  said  State 
treasurer  to  immediately  convert  so  much  of  said  deposit  as  may  be 
necessary  into  cash  and  to  forthwith  satisfy  said  judgment  and  such 
additional  costs  appertaining  thereto  as  said  court  may  allow,  and 
said  treasurer  shall  immediately  comply  with  said  order,  and  the 
association  shall  not  transact  any  further  business  in  this  State  until 
such  deposit  is  restored.  When  anj'  such  association  discontinues 
business  in  this  State,  and  the  insurance  commissioner  is  satisfied 
upon  investigation  that  the  association  has  no  liabilities  outstanding 
therein,  he  shall  so  certify  to  the  State  treasurer,  who  shall  there- 
upon return  said  deposit  to  the  association. 

Section  4.  Every  call  for  a  payment  by  the  policy  holdei-s  of  any 
such  association  shall  distinctly  state  the  purpose  of  the  same,  and  no 
part  of  the  money  collected  for  the  payment  of  indemnity  claims  or 
death  or  funeral  benefits  and  no  part  of  the  reserve  or  emergency 
fund  shall  be  used  for  expenses. 

Section  5.  Except  as  otherwise  herein  provided,  the  fees  for 
license  to  the  association  or  its  agents  or  any  renewal  thereof  or  for 
any  act  or  service  of  the  insurance  commissioner  or  the  State  treas- 
urer shall  be  the  same  as  is  provided  by  section  seventeen  of  chapter 


384  FRATERNAL    SOCIETY    LAW 

one  hundred  and  seventeen  of  the  revised  statutes  for  life  insurance 
companies. 

Section  6.     This  act  shall  take  effect  when  approved. 

Approved  March  17,  1905. 

The  following  sections  of  the  law  are  here  included  because  of 
their  possible  relation  to  Fraternal  Societies: 

An  Act  additional  to  Chapter  forty-nine  of  the  Revised  Statutes, 
relating  to  Insurance  and  Insurance  Companies. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  in 
J-iCgislature  assembled,  as  follows: 

Section  1.  Every  policy  of  insurance  issued  to  a  resident  of  Maine 
by  any  insurance  company,  except  a  domestic  life  or  stock  insurance 
company,  which  contains  a  reference  to  the  application  of  the  in- 
sured, either  as  a  part  of  the  policy  or  as  having  any  bearing  thereon, 
nuist  have  attached  thereto  a  correct  copy  of  the  application,  and 
unless  so  attached  the  same  shall  not  be  considered  a  part  of  the 
policy  or  received  in  evidence.  Each  application  for  such  policy 
shall  have  printed  upon  it  or  upon  a  slip  attached  thereto  in  large 
bold-faced  type  the  following  words :  ' '  Under  the  laws  of  Maine,  each 
applicant  for  a  policy  of  insurance  to  be  issued  hereunder  is  en- 
titled to  be  furnished  with  a  cojiy  of  this  application  attached  to  any 
policy  issued  thereon." 

Section  2.  Any  iutsoii  u-lio  knowingly  or  wilfully  makes  a  false 
or  fraudulent  statement  or  representation  in  or  relative  to  any  appli- 
cation for  accident,  health  or  casualty  insurance,  or  who  makes  any 
such  statement  for  the  purpose  of  obtaining  a  fee,  commission,  money 
iiv  benefit  in  a  corporation  transacting  such  business  in  this  State, 
shall  be  punished  by  a  fine  of  not  less  than  one  hundred  nor  more 
than  five  hundred  dollars  or  by  imprisonment  for  not  less  than 
thirty  days  luir  more  than  one  year,  or  by  both  such  fine  and  impris- 
onment; and  a  person  who  wilfully  makes  a  false  statement  of  any 
material  fact  or  tiling  in  ;i  sworn  statement  as  to  the  death  or  dis- 
ability of  a  ]iolicy  or  certificate  holder  in  any  s\ieh  cori)oratioii,  for 
the  |)iir]Hisi'  ol'  proiMiring  pnyiiioit  of  a  benefit  named  in  the  certifi- 
cate of  such  holder,  shall  be  guilty  of  ])er.iury. 

.\j)proved  March  fi.  1007. 


THE    STATE    OF    MAINE  385 

Actions  Against  Foreign  Companies. 

(Revised  Statutes  of  1903,  Chapter  83.) 
Section  22.  In  actions  bj'  inhabitants  of  this  State  against  insur- 
ance companies  established  by  any  other  State  or  eovuitry,  on  policies 
of  insurance  signed  or  countersigned  by  agents  in  this  State,  on  prop- 
erty or  lives,  or  against  accidents  in  this  State ;  and  in  such  actions 
against  express  companies  so  established,,  service  is  sufficient  if  made 
on  the  person  who  signed  or  countersigned  such  policies,  or  on  any 
agent  or  attornej'  of  either  such  company,  or  if  left  at  his  last  and 
usual  place  of  abode  thirty  days  before  the  return  day  of  the  suit; 
but  the  court  may  in  any  case,  order  fui-ther  notice. 

Section  107.  Any  foreign  corporation  doing  business  continuously 
in  this  State,  and  having  constantly  an  officer  or  agent  resident 
herein,  on  whom  service  of  au.y  process  may  be  made,  shall  be  en- 
titled to  the  benefit  of  all  provisions  of  law  relating  to  limitation 
,of  actions  the  same  as  domestic  corporations. 

Larceny. 

(Revised  Statutes  of  1903,  Chapter  121.) 
Section  10.  Whoever  embezzles,  or  fraudulently  converts  to  his 
own  use,  or  secrets  with  intent  to  embezzle  or  fraudulently  convert 
to  his  own  use,  money,  goods  or  property  delivered  to  him,  or  any 
part  thereof,  which  may  be  the  subject  of  larceny,  shall  be  deemed 
guilty  of  larceny,  and  shall  be  punished  accordingly.  And  any  insur- 
ance agent,  or  agent  of  any  corporation  doing  business  in  the  State, 
who  appropriates  to  his  own  use  any  money,  or  substitutes  for  money, 
received  by  him  as  such  agent,  or  refuses  or  neglects  to  pay  over 
and  deliver  the  same  to  the  party  entitled  to  receive  it,  for  thirty 
days  after  written  demand  upon  him  therefor,  is  guilty  of  larceny, 
and  shall  be  punished  accordingly. 

Inquests  into  Insurance  Frauds. 

Section   76.     Chap.  49.   R.   S.     On   application   in  writing  to  the 

commissioner  by  an  officer  of  auj'  insurance  company  doing  business 

in  the  State,  stating  that  he  has  reason  to  believe  and  does  believe 

that  any  person  ha.s,  by  false  representations,  procured  from  said 

25 


386  FRATERNAL    SOCIETY    LAW 

company  an  insurance,  or  that  the  companj^  has  sustained  a  loss  by 
the  fraudulent  act  of  the  insured,  or  with  his  knowledge  or  consent, 
and  requesting  an  investigation  thereof,  said  commissioner,  or  his 
deputy  or  such  magistrate  as  he  appoints,  shall  summon  and  examine, 
under  oath,  at  a  time  and  place  designated  by  him,  any  persons,  and 
require  the  production  of  all  books  and  papers  necessary  for  a  full 
investigation  of  the  facts,  and  make  report  thereof,  with  the  testi- 
mony by  him  taken,  to  the  company  making  such  application. 

Renewal  Contracts. 

Unless  other\vise  expressed,  a  renewal  of  a  contract  of  insurance 
through  a  new  agreement,  will  be  construed  to  be  subject  to  the 
terms  and  conditions  contained  in  the  original  contract. 

Bickford  vs.  Aetna  Insurance  Co.,  January  5th,  1906,  101  Maine  124. 

Construction  of  Ambiguous  Contracts. 

An  insurance  contract  should,  in  cases  of  ambiguity  be  construed 
more  favorable  to  the  insured,  and  the  language  of  the  contract,  if 
ambiguous,  is  to  be  interpreted  in  the  light  of  attending  circum- 
stances and  the  intent  of  the  parties. 

Bickford  vs.  Aetna  Insurance  Co.,  January  5th,  1906,  101  Maine  124. 

Application  Filled  up  by  Agent. 

An  application  for  a  contract  of  life  insurance  was  signed  in 
blank  by  the  applicant  and  delivered  in  this  condition  to  the  agent 
of  the  company,  with  the  understanding  that  the  agent  should  fill  in 
the  answers  to  the  questions  from  information  contained  in  a  pre- 
vious application  for  insurance,  which  had  been  made  out  in  the 
applicant's  presence  and  signed  by  him.  It  was  held  by  the  court 
that  if  the  agent  filled  in  the  second  application  in  accordance  with 
the  terms  of  the  first,  then  the  applicant  would  be  bound  by  it.  but 
if  the  agent  filled  in  the  second  application  with  answers  that  were 
not  contained  in  the  first  one,  or  if  he  filled  them  in  differently  from 
what  they  were  in  the  first,  then  the  applicant  would  not  be  bound 


THE    STATE    OF    MAINE  387 

by  them,  becauso  they  would  be  tlie  answer.s  of  the  agent  and  not 
the  answers  of  the  applicant;  and  the  eourt  further  said  that  it  is  a 
rule  of  law  that  an  application  for  life  insurance  signed  in  blank  by 
one  desiring  insurance,  and  filled  in  by  the  company  or  its  agent, 
should  be  construed  most  favorable  to  the  applicant. 

Hewey   vs.    Metropolitan    Life    Insurance    Co.,    December    6th,    1905, 
100  Maine  523. 

Warranties — Materiality  of  Statements. 

When  defense  to  the  payment  of  a  certificate  is  asserted  solel.v  on 
the  ground  that  statements  of  the  member  made  in  his  application 
as  to  his  bodily  health  are  not  true,  it  is  held  immaterial  whether 
the  statements  be  regarded  as  warranties  or  as  representations. 

Jeffrey  vs.  United  Order  of  the  Golden  Cross,  December  27th,  1902, 
97  Maine  176. 

Material  Representations. 

In  passing  upon  representations  contained  in  an  application  for 
life  insurance,  it  was  held  that  representations  would  not  be  con- 
sidered as  substantially  true  Avhen  they  were  only  partly  true  on  the 
one  hand,  nor  when  true  in  every  possible  immaterial  respect,  on  the 
other.  The  court  held  that  representations  must  be  true  in  all 
respects  material  to  the  risk,  and  that  representations  with  respect 
to  the  condition  of  the  applicant's  health  past  and  present,  were 
material  to  the  risk  proposed. 

Jeffrey  v.s.  United  Order  of  the  Golden  Cross,  December  27th,  1902, 
97  Maine  176. 

Good  Health — Misrepresentation. 

The  applicant  stated  in  her  application  in  answer  to  a  question 
that  she  had  had  dyspepsia  in  a  light  form.  The  testimony  showed 
that  she  had  suli'ered  from  chronic  dyspepsia  for  many  years;  and 
the  eourt  held  that  there  was  a  material  misstatement,  and  that  she 


388  FRATERNAL    SOCIETY    LAW 

was  not  in  good  health  at  the  time  when  she  applied  for  membership 
as  she  had  represented  herself  to  be. 

Jeffrey  vs.  United  Order  of  the  Golden  Cross,  December  27th,  1902, 
97  Maine  176. 

Beneficiary — Adopted  Child. 

An  adopted  cliild  was  held  to  be  competent  to  take  as  beneficiary 
under  a  life  insurance  contract  issued  and  payable  to  among  others 
"his  widow,  if  any,  otherwise  for  the  benefit  of  his  surviving  chil- 
dren." The  court  holding  that  the  adopted  child  was  to  be  regarded 
as  the  member's  child  bj-  law  but  not  by  birth. 

Virgin  vs.  Marwick,  June  30th,  1903,  97  Maine  578. 

Suicide — Death  Resulting  from  Habits. 

A  contract  stipulated  among  other  things  that  the  company  should 
not  be  liable  in  the  event  of  self-destruction  of  the  insured  in  any 
form,  except  upon  proof  that  the  same  should  be  the  direct  result 
of  disease  or  accident  occurring  without  the  voluntary  act  of  the 
insured ;  nor  in  case  the  death  of  the  insured  resulted  from  any  dis- 
ease produced  by,  or  resulting  from  the  occasional  or  habitual  use 
of,  alcoholic  or  narcotic  stimulants.  Defense  was  made  to  the  suit 
on  this  contract  on  the  ground  of  alleged  self-destruction  of  the 
member.  It  was  claimed  by  the  plaintiff  that  while  the  member  com- 
mitted suicide,  that  he  was  insane,  while  the  countercharge  was  made 
that  if  such  was  the  case,  that  the  insanity  was  the  result  of  use  of 
alcoholic  stimulants.  The  facts  were  submitted  to  the  jury,  and  the 
verdict  went  against  the  society.  No  questions  of  law  were  dis- 
cussed by  the  court,  but  the  facts  are  interesting. 

Arnold  vs.  Conn.  Mut.  Life  Ins.  Co.,  June  26th,  1901,  95  Maine  331. 

A  Charity  Defined — Fraternal  Society  Not  a  Charitable  Institution. 

In  a  suit  for  a  sick  benefit  claimed  to  bo  due  by  the  by-laws  of  a 
society,  a  defense  interposed  was  that  the  society  was  a  charitable 
institution,  and  in  passing  upon  this  question  the  court  said: 


THE     ,STATE     OF    MAINE 


38^ 


"Defendant  corporation  is  in  no  sense  a  benevolent  or  charitable 
institution.  Charity  in  its  legal  sense  has  its  origin  in  gift  and 
bounty.  It  has  been  well  defined  as  'wliatever  is  given  for  the  love 
of  God,  or  the  love  of  your  neighbor,  in  tlie  catholic  or  univcr-s:il 
sense;  given  from  these  motives  and  to  these  ends,  free  from  the 
stain  or  taint  of  every  consideration  that  is  personal,  private,  or 
selfish.'  Ould  vs.  Washington  Hospital,  95  U.  S.  311.  'It  is  the 
source  whence  the  funds  are  derived,  and  in  the  purpose  to  which 
they  are  dedicated,  which  constitutes  the  use  charitable. '  If  derived 
from  the  gift  of  the  government  or  a  private  gift  for  improving  a 
town,  they  are  charitable,  but  where  a  fund  is  wholly  derived  from 
rates  and  assessments,  being  in  no  respect  derived  from  bounty  or 
charity,  it  is  not  charitable. 

Attorney  General  vs.  Heelis,  2  Sim.  &  Stu.  77. 

Bolton   vs.   Bolton.   73   Maine  303. 

Bangor  vs.  Masonic  Lodge,  73  Maine  429. 

Saltonstall  vs.   Sanders,  11  Allen  456. 

Coe  vs.  Washington  Mills,  149  Massachusetts  547. 

"Here  for  a  definite  amount  paid  by  a  member  at  regular  recurring 
periods,  the  corporation  undertook  to  pay  its  member,  if  sick  and 
unable  to  work,  a  definite  sum  per  week  for  a  period  not  exceeding 
thirteen  weeks  in  the  year,  excluding  the  first  week  of  sickness. 
Whatever  it  may  be  called,  the  scheme  and  the  contract  is  that  of 
insurance.  The  relation  of  the  corporation  to  its  members  is  con- 
tractual, rather  than  charitable. 

"Nor  is  it  a  benevolent  institution.  No  aid  is  furnished  fi-oni 
generosit}'.  None  such  is  pretended.  On  the  contrary,  for  a  pecuni- 
ary consideration  it  agrees  to  pay  a  definite  sum  in  the  cases  speci- 
fied. If  it  fails  to  perform  its  contracts  with  its  members,  they  may 
be  enforced  in  the  courts  by  suit." 

Dolan  vs.  Court  Good  Samaritan,  12S  Massachusetts  437. 

Coe  vs.   Washington   Mills,  supra. 

Clement  vs    L'Institut  .Tactjues  Cartier,  95  Maine  493. 

Warranty — False  Age  Given. 

The  by-laws  of  a  fraternal   society  prohibited   the   admission   of 


390  FRATERNAL    SOCIETY    LAW 

persons  more  than  fifty  years  of  age.  An  applicant  for  admission 
declared  in  his  application  that  he  was  forty -nine  years  of  age.  He 
was,  in  fact,  at  that  time  fifty  years,  nine  months  and  seventeen 
days  old.  It  was  held  that  the  declaration  of  the  application  was  a 
misrepresentation  of  a  material  fact,  and  that  such  misrepresenta- 
tion rendered  invalid  the  contract  made. 

Marcoux  vs.   Society   of   Beneficence  St.   John   Baptist  of   Fairfield, 
January  20,  1898,  91  Me.  250. 

Assumed    Contracts    by    Absorbing    Society — Original    Provisions 
Continued. 

A  contract  made  in  a  society  which  afterwards  became  absorbed 
in  another  society,  at  maturity,  was  sued  upon,  and  the  adopting 
society  defended  on  the  ground  of  misrepresentation  made  in  the 
application  for  insurance,  made  to  the  society  absorbed.  The  court 
held  that  inasmuch  as  the  defendant  society  assumed  the  obligation 
pertaining  to  the  membership  of  the  plaintiff's  husband,  and  only 
upon  the  implied  condition  that  his  declarations  made  in  his  original 
application  to  the  absorbed  society  were  true,  and  that  the  contract 
was  continued  in  operation  by  the  agreement  of  the  society  with 
the  member,  held  that  any  misstatement  or  misrepresentations  of 
a  material  fact  contained  in  the  original  application  would  avoid 
the  contract  sued  on. 

Marcoux   vs.   Society   of   Beneficence   St.   John   Baptist  of  Fairfield, 
January  20,  1898,  91  Maine  250. 

Forfeiture — Waiver. 

Oil  the  question  of  waiver  in  case  where  forfeiture  of  membcrsliip 
was  discovered  by  the  society  subsequent  to  the  member's  death, 
the  court  said:  "It  ajipears  that  the  defendant  society  in  pursuance 
to  a  vote  attended  Marcoux 's  funeral  as  a  body  and  in  uniform,  and 
it  is  contended  that  this  was  a  recognition  of  the  validity  of  his 
membership,  and  that  it  is  evidence  of  a  waiver,  on  the  part  of  the 
society  of  any  objections  on  account  of  any  invalidity  of  his  mem- 
bership.    Without  considering  what  would  be  the  effect  of  a  case 


THE   STATE    OF   MAINE  391 

like  this  of  an  intended  waiver,  we  do  not  find  that  there  was  in  fact 
any  waiver.  *  *  *  Certainly  not  as  to  the  effect  of  the 
misstatement  of  age,  for  it  does  not  appear  that  the  society  had  any 
knowledge  of  the  true  age  of  Marcoux  until  long  after  his  funeral. 
One  cannot  be  said  to  waive  that  which  he  does  not  know." 

Marcoux  vs.   Society  of  Beneficence  St.   John  Baptist  of  Fairfield. 
January  20,  1898,  91  Maine  250. 


392  FRATERNAL    SOCIETY    LAW- 


TILE 

STATE  OF  MARYLAND. 

CHAPTER  21. 

(The  Section  numbers  employed  correspond  to  those  in  the  Insur- 
ance Code,  published  by  the  Insurance  Department  of  Maryland, 
July,  1906,  and  being  Sections  143E  to  143R  inc.,  Ch,  295  of  1894.) 

Section  210.  A  fraternal  beneficiary  association  is  hereby  declared 
to  be  a  corporation,  society  or  voluntary  association,  formed  or 
organized  and  carried  on  for  the  sole  benefit  of  its  members  and  their 
beneficiaries,  and  not  for  profit.  Bach  such  association  shall  have  a 
lodge  system,  with  ritualistic  form  of  work  and  a  representative 
form  of  government,  and  shall  make  provision  only  for  the  payment 
of  benefits  in  case  of  sickness,  disability  or  death  of  its  members, 
subject  to  their  compliance  with  its  constitution  and  laws.  The  fund 
from  which  the  payment  of  such  benefits  shall  be  made  and  the 
fund  from  which  the  expenses  of  such  association  shall  be  defrayed 
shall  be  derived  from  fees,  assessments  and  dues  collected  from  its 
members.  Payments  of  death  benefits  may  be  made  only  to  the 
widow,  children,  grandchildren,  mother,  father,  brother,  sister, 
grandparent,  aunt,  uncle,  niece,  nephew,  first  cousin,  next  of  kin  who 
would  be  distributees  of  the  member's  personal  estate  if  he  died  in- 
testate, to  an  affianced  hu.sband  or  affianced  wife  of  the  member,  or  to 
persons  dependent  upon  the  member  for  food,  lodging,  clothing  or 
education,  and  to  none  other;  provided,  that  payment  can  only  be 
made  to  a  benefieinrv  by  reason  of  dependency  when  it  is  established 
by  documentary  proof  to  the  satisfaction  of  the  executive  officers 
(Vf  such  association  that  the  fact  of  such  dependency,  as  herein  pro- 
vided, exi.sted  at  the  member's  doatli.  and  no  benefit  certificate  sliall 


THE    STATE    OF    MARYLAND  393 

issue  designating  a  beneficiary  by  way  of  dependency,  unless  such 
dependency  shall  be  fully  set  forth,  in  writing,  and  established  by 
documentary  proof  to  the  satisfaction  of  said  executive  officers, 
prior  to  the  issuance  thereof.  A  benefit  shall  not  be  assignable 
except  to  the  beneficiaries  above  specified,  and  then  only  by  the 
consent  of  such  association,  attested  by  its  seal  and  the  signature 
of  its  supreme  secretary  and  its  supreme  executive  officer;  but  the 
member  may  surrender  his  benefit  certificate  and  have  a  new  one 
issued  to  any  one  or  more  of  the  beneficiaries,  as  above  specified,  in 
llic  manner  provided  by  the  constitution  and  laws  of  such  associa- 
tion. Such  association  shall  be  governed  by  the  provisions  of  Sec- 
tion 210  to  Section  223,  both  inclusive,  of  this  article,  and  shall  be 
exempt  from  the  provisions  of  the  insurance  laws  of  this  State,  and 
no  law  hereafter  passed  shall  apply  to  them  unless  they  be  expressly 
designated  therein ;  jirovided.  that  any  corporations  or  associations, 
orders  or  societies,  operating  on  the  lodge  system  and  having  ritual- 
istic work  in  their  lodges,  councils  or  societies,  whose  business  it  is, 
in  whole  or  in  part,  to  pay,  at  the  expiration  of  a  fixed  period  of  not 
less  than  five  years,  a  sum  not  exceedng  the  maximum  amount  named 
in  their  certificates,  or  paying  dividend,  withdrawal,  surrender  or 
old  age  benefits,  or  paying  such  certificates  at  the  expiration  of  life 
expectancy,  may  conduct  their  business  in  this  State  under  the  pro- 
visions governing  fraternal  beneficiary  societies,  orders  or  assQcia- 
tions,  with  this  exception,  that  no  such  corporation  or  association 
shall  be  permitted  to  begin,  do  or  continue  business  in  this  State, 
until  it  shall  have  first  deposited  with  the  insurance  commissioner  of 
this  State,  the  sum  of  ten  thousand  dollars  in  dividend-bearing 
securities,  satisfactory  to  said  commissioner,  as  a  guarantee  for  the 
payment  of  certificates  issued  by  it,  which  deposit  shall  be  constantly 
maintained  at  that  amount ;  provided,  however,  that  any  such  corpo- 
ration or  association  organized  under  the  laws  of  any  other  State, 
which  may  have,  under  the  laws  of  the  State  of  which  it  is  a  citizen, 
a  deposit  of  equal  value  for  the  purpose  herein  mentioned,  shall, 
upon  proof  of  the  existence  of  such  deposit,  not  be  required  to  make 
the  same  with  the  insurance  commissioner  of  this  State. 

Section  211.     Any  such  association  coming  within  the  description 
of  a  fraternal  beneficiarj'  association,  as  set  forth  in  section  210  of 


394  FRATERXAL    SOCIETY    LAW 

this  article,  organized  under  the  laws  of  this  or  any  other  State, 
province  or  territorj-,  and  now  doing  business  in  this  State,  may 
continue  such  business,  provided  that  it  hereafter  comply  with  the 
provisions  of  sections  213  and  214  regulating  annual  reports,  and 
the  designation  of  the  commissioner  of  insurance  as  the  person  upon 
whom  process  may  be  served  as  hereinafter  provided;  and  shall  file 
with  the  commissioner  of  insurance  a  duly  certified  copy  of  its  char- 
ter or  act  of  incorporation,  its  form  of  benefit  certificate  and  also 
a  certificate  of  the  proper  officer  of  such  State,  province  or  territory, 
certifj'ing  that  such  association  is  authorized  to  conduct  its  business 
therein,  where  the  laws  of  such  State,  province  or  territory  require 
an  annual  report  of  the  operations  of  such  association,  or  where 
its  laws  authorize  such  certificate,  and,  thereupon,  said  commissioner 
of  insurance  shall  issue  a  certificate  to  said  association  authorizing 
it  to  continue  to  do  business  in  this  State,  for  which  he  shall  receive 
the  sum  of  twenty -five  dollars ;  but  if  said  association  be  incorporated 
under  the  laws  of  this  State,  or  if  it  be  a  foreign  corporation,  and 
by  the  laws  of  the  State  of  its  corporation  shall  not  be  required  to 
make  report,  or  the  certificate  referred  to  in  this  section  shall  not 
ba  authorized  by  such  law,  then  the  commissioner  of  insurance  shall 
make  examination  of  its  afl'airs  in  manner  as  provided  in  the  next 
succeeding  section,  in  like  case  before  issuing  such  certificate,  and 
until  a  certificate  is  refused,  after  examination  had  as  provided, 
such  association  shall  continue  to  do  business  in  the  State  as  here- 
tofore. The  expense  of  the  examination  required  under  this  section 
for  associations  incorporated  under  the  laws  of  this  State  shall  not 
exceed  fifty  dollars. 

Section  212.  Any  such  association  coming  within  the  description 
of  a  fraternal  beneficiary  association,  as  set  forth  in  section  210  of 
this  article,  organized  under  the  laws  of  any  other  State,  province  or 
territory,  and  not  now  doing  business  in  this  State,  shall  be  admitted 
to  do  business  within  this  State,  when  it  shall  have  filed  with  the 
commissioner  of  insurance  a  duly  certified  cop.y  of  its  charter  and 
articles  of  association,  and  a  copj^  of  its  constitution  or  laws  certified 
to  by  its  secretary  or  corresponding  officer,  together  with  an  ap- 
pointment of  the  commissioner  of  insurance  of  this  State,  as  a  person 
upon  whom  process  may  be  served  as  hereinafter  provided ;  and 


THE    STATE    OF    MARYLAND  395 

shall  pay  said  commissioner  of  iiistiraiiue  a  fee  of  twenty-five  dollars 
for  liliiiu'  said  charter,  cn\)y  of  eonstitnt ion  and  laws,  and  apimint- 
menf  oi'  attorney;  and  provided  that  such  association  sindl  be  shown 
by  cerlifieate  to  be  authorized  to  do  business  in  the  State,  province 
or  teri'itcn'v  in  which  it  is  ineor|ioratc(l  oi'  <ii'n;ini/.e(l,  in  case  the 
laws  of  such  State,  province  or  territory  shall  provide  for  such 
authorization ;  and  in  case  the  laws  of  such  State,  province  or  terri- 
tory do  not  provide  for  any  formal  authorization  to  do  business  on 
the  part  of  any  such  associatifui,  tlu'u  such  association  shall  Ix; 
shown  to  be  conducting  its  business  in  accordance  with  the  pro- 
visions of  section  210  to  section  223  (both  inclusive)  of  this  article, 
for  which  purpose  the  commissioner  of  insurance  of  this  State  may 
personally  or  by  some  person  to  be  designated  by  him,  examine 
into  the  condition,  affairs,  character  and  business  methods,  accounts, 
books  and  investments  at  its  home  office,  which  examination  shall 
be  at  the  expense  of  such  association,  and  shall  be  made  within  thirty 
days  after  demand  therefor ;  and  the  commissioner  of  insurance  .shall 
be  paid  by  such  association  for  such  examination  the  actual  traveling 
expenses  and  not  more  than  ten  dollars  per  day  for  each  day  actually 
employed  in  such  examination,  not  to  exceed  fifty  dollars  in  the 
aggregate.  The  commissioner  of  insurance  shall  issue  a  certificate 
to  such  association,  qualified  as  required  in  this  section,  authorizing 
it  to  do  business  within  this  State,  for  which  certificate  said  asso- 
ciation shall  pay  to  the  said  commissioner  the  fee  of  twenty-five  dol- 
lars. 

Section  213.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  last  day  of  March  of  each  year,  make  and 
file  with  the  insurance  commissioner  of  this  State  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  thirty-first  day 
of  December  immediately  preceding,  which  annual  report  shall  be 
in  lieu  of  all  other  reports  required  by  any  other  law;  such  reports 
shall  be  upon  appropriate  blank  forms  to  be  provided  by  the  insur- 
ance commissioner,  and  shall  be  verified  under  oath  by  the  duly 
authorized  officer  of  such  association,  and  shall  be  published,  or  the 
substance  thereof,  in  the  annual  report  of  the  insiirance  commis- 
sioner, under  a  separate  part,  entitled  "Fraternal  Beneficiary  Asso- 
ciations."    The  insurance  commissioner  is  authorized  and  empow- 


396  FRATERNAL    SOCIETY    LAW 

ered  at  any  time  to  address  auy  additional  iiujuiries  to  any  such 
association,  in  relation  to  its  doings  or  condition,  or  any  other  matter 
connected  with  its  transactions  relative  to  the  business  contemplated 
by  section  210  to  section  218  (both  inclusive)  of  this  article,  and  such 
officers  of  such  associations  as  the  insurance  commissioner  may  re- 
quire, shall  promptly  reply  in  writing  under  oath  to  all  such  in- 
quiries if  so  required;  and  in  case  after  si;ch  inquiry  the  insurance 
commissioner  shall  have  reason  to  believe  that  such  association  is 
insolvent  or  cannot  meet  its  obligations  to  its  beneficiaries  or  certifi- 
cate holders,  or  is  conducting  its  business  in  an  illegal  manner,  he 
may,  by  some  person  designated  by  him,  examine  the  accounts,  books 
and  investments  of  said  association  at  its  home  office,  at  the  expense 
of  said  association,  not  to  exceed  in  the  aggregate  the  sum  of  fiftj'- 
dollars;  each  such  association  on  filing  its  annual  report  shall  pay  to 
the  insurance  commissioner  the  sum  of  twenty-five  dollars. 

Section  214.  Each  such  association  now  doing  or  hereinafter  ad- 
mitted to  do  business  within  this  State,  and  not  having  its  principal 
office  within  this  State,  and  not  being  organized  under  the  laws 
of  this  State,  shall  appoint,  in  writing,  the  insurance  commis- 
sioner, or  his  successor  iu  office,  to  be  its  true  and  lawful  attorney 
upon  whom  all  lawful  process  in  any  action  or  proceeding  against 
it  may  be  served,  and  in  such  writing  shall  agree  that  any  lawful 
process  against  it  which  is  served  on  said  insurance  commissioner 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
association,  and  that  the  authority  shall  continue  in  force  so  long 
as  any  liability  remains  outstanding  in  this  State.  Copies  of  such 
certificate,  certified  by  said  insurance  commissionei",  shall  be  deemed 
sufficient  evidence  thereof,  and  shall  be  admitted  in  evidence  with 
the  same  force  and  effect  as  the  original  thereof  might  be  admitted. 
Service  upon  such  attorney  shall  be  deemed  sufficient  service  upon 
such  association.  When  legal  process  against  any  such  association 
is  served  Tipon  said  insurance  commissioner,  he  shall  immediately 
notify  the  association  of  such  service  by  letters  prepaid  and  directed 
to  its  president,  secretary  and  supreme  or  chief  secretary  or  corre- 
spondirm'  ol'licei-s;  and  shall  within  two  days  after  such  service  for- 
ward in  the  same  manner  a  copy  of  the  process  served  on  him  to 
such  officers.    The  plaintiff,  in  such  process  so  served,  shall  pay  to 


THE    STATE    OF    MARYLAND  397 

the  commissioner  of  iiisurance,  at  the  time  of  such  service,  a  fee 
of  five  dollars,  which  shall  be  recovered  by  him  as  part  of  the  tax- 
able costs,  if  he  prevails  in  the  suit.  The  insurance  commissioner 
sliall  keep  a  record  of  all  processes  served  upon  him,  which  record 
shall  show  the  day  and  hour  when  such  service  was  made. 

Section  215.  The  insurance  commissiouer  of  this  State  shall  fur- 
nish to  each  of  said  associations  doing  business  within  this  State, 
as  provided  by  section  210  to  section  223  (both  inclusive)  of  this 
article,  two  abstracts  of  its  annual  report  prepared  for  publication, 
for  which  it  shall  pay  him  the  sum  of  four  dollars. 

Section  216.  Such  association  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organizing  or  building 
up  of  subordinate  bodies  or  granting  members  inducements  to  pro- 
cure new  members. 

Section  217.  The  money  or  other  benefit,  charity,  relief  or  aid 
to  be  paid,  provided  or  rendered  by  any  association  authorized  to  do 
business  under  section  210  to  section  223  (both  inclusive)  of  this 
article,  shall  not  be  liable  to  attachment  by  trustee,  garnishee  or 
other  process,  and  shall  not  be  seized,  taken,  appropriated  or  applied 
by  any  legal  or  equitable  process  or  by  operation  of  law  to  pay 
any  debt  or  liability  of  a  certificate  holder  or  of  any  beneficiary 
named  in  a  certificate,  or  of  any  person  who  may  have  any  right 
thereunder. 

Section  218.  Any  such  association  organized  under  the  laws  of 
this  State  may  provide  for  the  meetings  of  its  legislative  or  govern- 
ing body  in  any  other  State,  province  or  territory  wherein  such  asso- 
ciation shall  have  subordinate  bodies,  and  all  business  transacted 
at  such  meetings  shall  be  valid  in  all  respects,  as  if  such  meetings 
were  held  within  this  State;  and  where  the  laws  of  any  such  associa- 
tion provide  for  the  election  of  its  officers  by  votes  to  be  cast  in  its 
subordinate  bodies,  the  votes  so  cast  in  its  subordinate  bodies  in  any 
other  State,  province  or  territory  shall  be  valid  as  if  cast  within 
this  State. 

Section  219.  Any  person,  officer,  member  or  examining  physician, 
who  sliall  knowingly  or  wilfully  make  any  false  or  fraudulent  state- 
ment or  representation,  in  or  with  reference  to  any  apjilieation  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit 


398  FRATERNAL    SOCIETY    LAW 

ill  any  association  transacting  business  under  sections  210  to  223 
(both  inclusive)  of  this  article,  shall  be  guilty  of  a  misdemeanor, 
and  upon  conviction  shall  be  punished  by  a  fine  of  not  less  than 
one  himdred  dollars  iinr  more  than  five  hiindred  dollars,  or  impi'lsou- 
ment  in  the  city  or  county  jail  for  not  less  than  thirty  days  nor 
more  than  one  year,  or  both,  in  the  discretion  of  the  court ;  and  any 
person  who  shall  wilfully  make  a  false  statement  of  any  material 
fact  or  thing  in  a  sworn  statement,  as  to  death  or  disability  of  a  cer- 
tificate holder  in  any  such  association  for  the  purpose  of  procuring 
payment  of  a  benefit  named  in  the  certificate  of  such  holder,  and  any 
person  who  shall  wilfully  make  any  false  statement  in  any  verified 
report  or  declaration  under  oath,  required  or  authorized  under  the 
provisions  of  section  210  to  section  223  (both  inclusive)  of  this 
article,  or  either  of  them,  shall  be  guilty  of  perjviry,  and  shall  be 
proceeded  against  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  i^erjury. 

Section  220.  Any  such  association  refusing  or  neglecting  to  make 
the  report  as  provided  in  section  213  shall  be  excluded  from  doing 
business  within  this  State  in  procuring  new  members.  The  insurance 
Commissioner  must,  within  sixty  days  after  failure  to  make  such 
report,  or  in  case  any  such  association  shall  exceed  its  powers,  or 
shall  conduct  its  business  fraudulently,  or  shall  fail  to  comply  with 
any  of  the  provisions  of  section  210  to  section  223  (both  inclusive) 
of  this  article,  immediately  commence  an  action  against  such  asso- 
ciation to  en,join  the  same  from  carrying  on  any  business.  And  no 
injunction  against  any  such  association  shall  be  granted  by  any 
court,  except  on  application  as  set  forth  in  this  section.  No  asso- 
ciation so  enjoined  shall  have  authority  to  continue  business  until 
such  report  shall  be  made,  or  overt  act  or  violation  complained  of 
shall  have  been  corrected,  nor  until  the  costs  of  such  action  bo  p:iid 
by  it;  provided,  the  court  shall  find  that  such  association  was  in 
defavilt  as  charged :  whereupon  the  insurance  coinmissi(uu'r  shall 
reinstate  such  association,  and  not  until  then  shall  such  association 
be  allowed  to  again  do  business  in  this  State.  Any  officer,  agent  or 
person  acting  for  any  association  or  subordinate  body  thereof,  within 
this  State,  in  procuring  new  members,  while  such  association  shall 
be  so  I'lijoinod  (U*  prohiliitcd  fi-om  doing  business  pursuant  to  this 


THE    STATE    OF    MARYLAND  399 

section,  shall  be  deemed  guilty  of  a  misdemeanor,  and  on  conviction 
thereof  shall  be  punished  by  a  fine  of  not  less  than  twenty-five  dollars 
nor  more  than  two  hundred  dollars,  or  by  imprisonment  in  the  city 
or  county  jail  not  less  than  thirty  days  nor  more  than  one  year,  or 
by  both  such  fiin'  and  imprisonment,  in  the  discretion  of  the  court. 

Section  221.  Any  person  who  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise  in  procuring  new  members  for  any  asso- 
ciation, which  shall  have  failed,  neglected  or  refused  to  comply  with, 
or  shall  have  violated  any  of  the  provisions  of  section  210  to  section 
223  (both  inclusive)  of  this  article,  or  shall  have  failed  or  neglected 
to  comply  with  thfe  provisions  therein,  preliminary  to  transacting 
business  as  provided  for  by  said  sections,  or  either  of  them,  shall  be 
subject  to  the  penalty  provided  in  the  last  preceding  section  for  the 
misdemeanor  therein  specified. 

Section  222.  Fraternal  beneficiary  societies,  orders  or  associa- 
tions as  described  is  section  210  may  be  incorporated  in  the  manner 
provided  for  the  formation  of  corporations  under  this  article ;  pro- 
vided, that  no  such  society,  order  or  association  incorporated  in 
another  State,  province  or  territory,  nor  any  council  or  branch,  or 
component  part  thereof,  can  be  incorporated  under  the  laws  of  this 
State. 

Section  223.  Any  association  entitled  to  do  business  in  this  State 
under  the  provisions  of  section  210  to  section  223  (both  inclusive) 
of  this  article,  which  shall  so  conduct  its  affairs  or  shall  in  any  man- 
ner change  its  charter,  constitution  or  laws,  so  that  it  shall  not 
answer  to  the  description  of  a  fraternal  beneficiary  association  as  set 
forth  in  section  210,  shall  thereupon  cease  to  be  entitled  to  the 
privilege  of  said  section. 

Section  224.  The  insurance  commissioner  of  this  State  shall 
notify  the  supreme  secretary  of  each  of  the  said  associations  now 
doing  business  in  this  State  of  sections  210-223,  and  enclose  a  blank 
for  the  report  of  its  operations  for  each  year  ending  December  31 ; 
and  every  association  receiving  such  notice  and  blank  shall  file  such 
report  in  the  manner  provided  in  section  213,  not  later  than  three 
months  from  the  date  of  the  receipt  of  such  notice  and  blank,  under 
the  like  penalties  as  provided  in  section  220  for  not  filing  a  report. 

Section  22.5.     Nothing  contained  in  sections  210-223  shall  apply 


400  FRATERNAL    SOCIETY    LAW 

to  lodges  or  orders  of  a  purely  religious,  charitable  or  benevolent 
description,  pajing  exclusively  sick,  funeral  or  death  benefits  to 
members,  their  family  or  dependents,  and  not  operated  with  a  view 
to  profit,  nor  shall  any  sucli  organization  be  required  to  make  any 
report  under  this  or  any  other  sections  of  the  insurance  laws;  and 
provided  further,  that  no  society,  lodge  or  body  of  any  secret  or 
fraternal  society,  or  association  of  employes  of  any  particular  trade, 
firm  or  corporation  organized  in  this  State,  paying  only  sick  benefits 
not  exceeding  two  hundred  and  fifty  dollars  in  the  aggregate  to  any 
one  person  in  any  one  year,  or  a  funeral  benefit  to  those  de- 
pendent on  a  member  not  exceeding  three  hundred  and  fifty  dollars, 
shall  be  required  to  make  any  report  thereof  under  this  article  or 
under  any  other  article  of  the  insurance  laws;  provided  further,  that 
certificates  issued  by  the  Improved  and  Independent  Orders  of  B  'nai 
B'rith  may  be  made  payable  to  charitable  institutions  as  now  pro- 
vided in  its  by-laws. 

The  following  sections  of  the  Maryland  code  as  prepared  by  the 
said  insurance  department  are  also  deemed  proper  to  be  included 
here : 

Fraud — Insurance  Companies,  by  Directors  or  Officers  of. 

Section  145.  Any  director  or  officer  of  any  insurance  company, 
or  association,  or  fraternal  beneficiary  association,  who  shall  receive 
any  premium  or  assessment  on  behalf  of  said  company,  association, 
or  fraternal  beneficiary  association,  knowing  at  the  time  of  the  re- 
ceipt of  said  premium  or  assessment,  said  company,  association  or 
fraternal  beneficiary  association  to  be  insolvent,  shall  be  deemed 
guilty  of  a  misdemeanor,  and,  upon  conviction  thereof,  shall  be 
liable  to  a  fine  not  exceeding  five  hundred  dollars,  or  imprisonment 
in  jail  for  a  period  not  exceeding  six  months,  or  both,  in  the  discre- 
tion of  the  court. 

Article  XLV,  Husband  and  Wife. 

Section  8.  Any  married  woman,  by  herself  and  in  her  name,  or 
in  the  name  of  any  third  person,  with  his  assent,  as  her  trustee,  may 
insure  or  cause  to  be  insured  for  her  sole  use  the  life  of  her  husband 


THE    STATE    OF    MARYLAND  401 

for  any  definite  period,  or  for  the  term  of  his  natural  life;  and  any 
husband  may  cause  his  own  life  to  be  insured  for  the  sole  use  of 
his  wife  and  may  also  assign  any  policy  of  insurance  upon  his  own 
life  to  his  wife  for  her  sole  use ;  and  in  case  of  the  wife  surviving 
her  husband,  the  sum  or  net  amount  of  such  insurance  becoming 
due  and  payable  by  the  terms  of  the  insurance  shall  be  payable  to 
her  for  her  own  use,  free  from  the  claims  of  the  representatives  of 
her  husband  or  any  of  his  creditors. 

Mutual   Benefit  Life  Ins.  Co.  vs.  Wise,  34  Md.  582. 

Emerich  vs.  Coakley,  35  Md.  ISS. 

Whitridge  vs.   Barry,  42  Md.  140. 

Knickerbocker   Life    Ins.   Co.  vs.  Peters,  42  Md.  415. 

Mutual  Life  Ins.   Co.  vs.   Stibbe.  46  Md.  312. 

Elliott  vs.  Bryan,  64  Md.  368. 

Earnshaw  vs.  Stewart,  64  Md.  514. 

Section  9.  All  policies  of  life  insurance  upon  the  life  of  any  per- 
son which  may  hereafter  mature,  and  which  have  been  or  shall  be 
taken  out  for  the  benefit  of  or  bona  fide  assigned  to  the  wife  or 
children  or  any  relative  dependent  upon  such  person  or  any  creditor, 
shall  be  vested  in  such  wife  or  children  or  other  relative  or  creditor, 
free  and  clear  from  all  claims  of  the  creditors  of  such  insured  person. 

Section  10.  If  the  wife  shall  die  before  her  husband  the  amount 
of  such  insurance  may  be  payable  after  her  death  to  the  children 
or  descendants  for  their  use,  and  to  their  guardian,  if  under  age,  and, 
if  there  be  no  children  or  descendants  of  the  wife  living  at  the  time 
of  her  death,  to  her  legal  representatives. 

Emerich  vs.  Coakley,  35  Md.  188. 

Article  LXXV,  Pleadings,  Practice  and  Process  at  Law. 

Section  23.  Whenever  any  insurance  company  or  surety  or  bond- 
ing company  of  any  kind  whatsoever  shall  have  a  duly  accredited 
agent  in  any  county  or  city  of  this  State  resident  therein  and  shall 
become  obligated  by  its  policy  or  other  contract,  express  or  implied, 
to  any  resident  of  any  such  county  or  city  the  said  company  may 
sue  or  be  sued  on  such  policies  as  other  contracts  in  the  same  man- 
ner as  if  resident  in  such  city  or  county,  by  causing  process  to  be 
26 


402  FRATERNAL    SOCIETY    LAW 

served  on  such  resident  agent,  which  shall  be  as  effective  in  law  and 
equity  as  if  such  service  had  been  made  on  the  president,  director 
or  directors  of  such  company,  and  the  judgment  rendered  in  such 
case  shall  have  the  same  force  and  effect  as  other  judgments  would 
or  could  have. 

Henderson  vs.  Md.  Home  Ins.  Co.,  90  Md.  51. 

Provisions  for  the  Formation  of  Corporations. 

Section  14.  Coi"porations  may  be  formed  in  this  State,  uuder  the 
provisions  hereinafter  set  forth,  by  any  five  or  more  persons,  citizens 
of  the  United  States,  and  a  majority  of  them  citizens  of  this  State,  or 
if  unnaturalized,  residents  of  this  State,  malking  oath  that  they 
bona  fide  intend  to  become  citizens  of  the  United  States  without  un- 
reasonable delay,  who  may  desire  to  form  a  body  corporate  or 
politic,  for  anj'  of  the  following  purposes : 

Section  15.  Class  1.  For  the  creation  and  maintenance  of  educa- 
tional, moral,  scientific,  literary,  dramatic,  musical,  social,  benevolent 
or  beneficial  societies  or  associations  of  all  descriptions ;  of  religious 
or  charitable  societies  or  associations;  fire  engine  and  hose  com- 
panies; and  of  uniformed  volunteer  companies;  of  universities,  col- 
leges, academies,  hospitals  or  asylums ;  provided  such  corporations 
are  located  in  this  State  and  that  the  propertj^  which  they  possess 
or  acquire  is  located  therein,  but  corporations  formed  for  the  creation 
and  maintenance  of  educational  associations,  universities,  colleges, 
academies,  hospitals  or  asylums  may  take  and  hold  any  property, 
real  or  personal,  situate  out  of  this  State  which  may  be  given, 
granted,  devised  or  bequeathed  to  said  corporations,  and  may  hold, 
use  or  sell  and  convey  the  same,  or  may  deal  with  it  in  any  manner 
not  inconsistent  with  law. 

Boyce  vs.  Trustees,  46  Md.  372. 

General  Regulations. 

Section  50.  Any  five  or  more  persons,  citizens  of  the  United 
States,  and  a  majority  of  them  citizens  of  this  State,  who  may 
desire  to  form  n   corpoi'iition  for  any  of  the  purjioses  hereinbefore 


THE    STATE    OF    MARYLAND  403 

referred. to,  shall  mako,  sign,  seal  and  acknowledge  before  some 
officer  competent  to  take  the  acknowledgment  of  deeds,  a  certificate 
in  writing  in  which  shall  be  stated : 

1.  The  names  in  full  and  places  of  residence  of  the  applicants. 

2.  The  proposed  corporate  name  of  the  corporation,  which  shall 
always  include  the  name  nf  thi'  county  or  city  in  which  it  may 
be  formed. 

3.  The,  object  or  purposes  for  which  incorporation  is  sought,  the 
time  of  its  existence  not  to  exceed  forty  years,  and  the  articles, 
conditions  and  i)rovisious  under  which  the  corporation  is  formed; 
provided,  that  the  limitations  as  to  the  duration  of  the  existence 
of  corporations  formed  under  this  article  shall  not  apply  to  gas 
light  companies,  cemetery  companies,  or  to  corporations  formed  for 
the  creation  or  maintenance  of  educational  associations,  universities, 
colleges,  academies,  hospitals  or  asylums,  and  that  certificates  of 
incorporation  of  all  corporations  named  in  the  proviso  may  contain 
provisions  for  perpetual  existence. 

Order  Int.  Frat.  All.  vs.  State.  77  Md.  5G1. 

4.  The  place  or  places  where  the  operations  of  the  corporation 
are  to  be  carried  on,  and  the  place  in  this  State  in  which  the  princi- 
pal office  of  the  eor])oration  will  be  located. 

5.  The  amount  of  capital  stock  (if  any)  of  the  corporation. 

6.  The  number  of  shares  of  stock  (if  any)  and  the  amount  of 
each  share. 

7.  The  number  of  trustees,  directors  or  managers,  and  their 
names,  who  shall  manage  the  concerns  of  the  corporation  for  the 
first  year. 

Section  51.  When  said  certificate  is  executed,  it  shall  be  the  duty 
of  the  persons  executing  the  same  to  submit  it  to  one  of  the  judges 
of  the  judicial  circuit,  within  which  the  principal  or  any  other  office 
of  said  corporation  is,  under  said  certificate,  to  be  located,  if  it  shall 
be  located  in  one  of  the  counties  of  this  State,  or  to  one  of  the 
judges  of  the  supre)ne  bench  of  Baltimore  city,  if  the  principal  office 
of  said  corporation  shall  be  located  in  Baltimore  city,  in  order  that 
the  said  judge  may  determine  whether  the  said  certificate  is  in  con- 


404  FRATERNAL    80CIETY    LAW 

formity  with  the  law ;  and  such  determination,  when  certified  by  the 
said  judge  as  required  by  the  next  succeeding  section,  shall  be  con- 
elusive  evidence  that  such  certificate  does  conform  to  the  law. 

Gtoodman  vs.  Jedidjah  Lodge,  67  Md.  125. 

Section  52.  If  the  said  judge  shall  so  determine,  he  shall  certify 
his  said  determination  upon  the  said  certificate,  which  shall  there- 
upon be  recorded  in  the  office  of  the  clerk  of  the  circuit  court  for 
the  county  in  which  the  principal  office  of  said  corporation  shall  by 
the  terms  of  said  certificate,  be  located,  if  it  shall  be  located  in  one 
of  the  counties  of  this  State,  or  in  the  office  of  the  clerk  of  the 
superior  court  of  Baltimore  city,  if  the  principal  office  of  said  cor- 
poration shall  be  located  therein ;  and  the  said  certificate  shall  be 
recorded  in  a  book  provided  for  that  special  purpose. 

Oler  vs.  Balto.  &  Randallstown  R.  R.  Co.,  41  Md.  583. 

Section  53.  When  the  said  certificate  shall  have  been  recorded,  the 
persons  who  have  signed  and  acknowledged  the  same,  and  their 
successors  shall,  according  to  the  objects,  purposes,  articles,  con- 
V  ditions  and  provisions  in  said  instrument  contained,  become,  and 
be  a  body  politic  and  corporate,  in  fact  and  in  law,  by  the  name 
stated  in  such  certificate. 

Grape  S.  &  V.  Co.  vs.  Small,  40  Md.  395. 

Section  54.  A  coj)y  of  such  certificate,  or  of  any  amendments 
thereto,  or  of  any  paper  relating  to  corporations,  which  is  required 
by  law  to  be  recorded,  when  certified  to  be  a  true  copy  by  the 
clerk  of  the  court  in  whose  oifice  the  same  is  recorded,  under  the 
seal  of  his  office,  shall  be  evidence  in  all  legal  proceedings,  and  in 
all  the  courts  of  this  State. 

Section  55.  If  any  alteration  or  amendment  of  the  articles  or 
provisions  of  the  charter  of  any  said  corporations  shall  be  made 
by  the  authority  of  the  corporations,  such  alterations  or  amendments 
shall  be  made  known,  acknowledged  and  recorded  in  the  same  man- 
ner as  prescribed  in  Sections  50,  51  and  52  of  this  article,  and  after 


THE    STATE    OF    MARYLAND  405 

the  said  alteration  or  amendment  shall  be  recorded,  the  same  shall 
be  taken  to  be  a  part  of  the  said  charter  or  instrument,  as  if  the 
same  had  originally  been  made  a  pni't  thereof;  and  any  corporation 
heretofore  formed  under  the  provisions  of  this  article  for  the  crea- 
tion or  maintenance  of  educational  associations,  universities,  col- 
leges, academies,  cemetery  companies,  hospitals  or  asylums,  the 
existence  of  which,  by  the  terms  of  its  charter,  is  limited  to  a  period 
of  forty  years  or  less,  is  authorized  to  amend  its  chai-ter,  so  as  to 
■provide  for  i^erpetual  existence. 

Section  57.  Every  corporation  incoi'porated  under  this  article 
shall  have  the  following  powers  and  be  subject  to  the  following 
general  regulations,  except  in  cases  where  the  special  provisions 
relating  to  any  particular  corporation  are  inconsistent  with  the  said 
general  regulations. 

Section  58.    Any  such  corporation  shall  have  power — 

First.  To  have  succession  by  its  corporate  name  for  the  period 
prescribed  by  law  or  by  the  certificate  evidencing  its  incorporation 
where  the  said  certificate  is  in  accordance  with  law. 

Section  59.  Second.  To  sue  and  be  sued,  complain  and  defend 
in  any  eoui't  of  law  or  equity. 

Section  60.  Third.  To  make  and  use  a  common  seal  and  alter 
the  same  at  pleasure. 

Section  61.  Fourth.  To  acquire  by  purchase  or  in  any  other  man- 
ner, and  take,  receive,  hold,  use,  employ,  manage,  mortgage,  dispose 
of,  or  in  any  manner  not  inconsistent  with  law,  deal  with  any  prop- 
erty, real,  personal  or  mixed,  and  situate  in  or  out  of  this  State, 
which  may  be  necessary  or  proper  to  enable  said  corporation  to 
carry  on  the  operations  or  fulfill  the  purposes  named  in  its  certifi- 
cate of  incorporation,  and  generally  to  do  evei'y  other  act  or  thing, 
not  inconsistent  with  law,  which  may  be  necessary  or  proper  to 
promote  the  ob.iects,  designs  and  purposes  for  which  said  corpora- 
tion was  formed. 

Hagerstown  Mnfg.  Co.  vs.  Keedy,  91  Md.  438. 

Section  62.  Fifth.  To  appoint  a  president  of  the  company  from 
among  the   directors,   trustees   or   managers,   and   to   appoint   such 


406  FRATERNAL    SOCIETY    LAW 

oiSeers  and  agents  as  the  business  of  the  corporation  shall  require; 
to  allow  them  a  suitable  compensation,  require  security  for  the 
faithful  discharge  of  their  duties  and  regulate  the  tenure  of  office 
of  the  said  officers. 

Eckenrode  vs.  Chemical  Co.,  55  Md.  65. 

Section  63.  Sixth.  To  make  by-laws,  not  inconsistent  with  law, 
for  the  management  of  its  propert.y,  the  regulation  of  its  affairs, 
and  for  the  transfer  of  its  stock,  if  any  such  stock  there  be ;  for 
the  forfeiture  of  stock  not  paid  for,  and  for  the  disposition  of  the 
proceeds  thereof;  for  the  calling  of  regular,  special  and  general 
meetings  of  the  directors,  managers  and  trustees  of  said  corporation, 
and  fixing  tlie  place  or  places  where  the  same  shall  be  held,  and  to 
provide  for  all  other  matters  which  may  be  regulated  by  by-laws, 
and  from  time  to  time  to  repeal,  amend  or  re-enact  the  same;  but 
every  such  by-law,  and  every  repeal,  amendment  or  re-enactment 
thereof,  unless  in  the  meantime  confirmed  at  a  general  meeting  of 
the  company,  duly  called  for  that  purpose,  shall  only  have  force 
until  the  next  annual  meeting  of  the  company,  and  in  defaiilt  of 
confirmation  thereof,  shall,  from  that  time  only,  cease  to  have  force. 
The  stockholders,  or  members  of  the  corporation,  may,  at  any  gen- 
eral meeting,  make  by-laws,  which  shall  not  be  rescinded  by  the 
directors,  managers  or  trustees. 

Morrison   vs.   Dorsey,  48  Md.  471;  Grafflin  vs.  Woodside,  87  Md.  151. 

Section  64.  No  corporation  shall  possess  or  exercise  any  corpor- 
ate powers  except  such  as  are  conferred  by  law,  and  such  as  shall 
be  necessary  to  the  exercise  of  the  powers  so  acquired. 

Davis  vs.  West  Saratoga  Bldg   Union,  32  Md.  295. 
State  vs.  Consolidation  Coal  Co.,  46  Md.  9. 

Section  65.  The  stock,  if  any,  property  and  concerns  of  any  cor- 
poration, for  whose  creation  provision  is  made  in  this  article,  shall 
be  managed  by  such  number  of  trustees,  dii'ectors  or  managers  as 
its  by-laws  or  charter  slmll    prescribe,  said  number  to  lie  not  less 


THE    STATE    OF   MARYLAND  407 

than  four  nor  more  than  twelve,  who  shall  respectively  be  citizens 
of  the  United  States,  and  a  majority  of  them  citizens  of  tliis  State; 
or  if  unnaturalized  residents  of  this  State  shall  make  oath  that  they 
intend  to  become  citizens  of  the  United  States  without  unreasonable 
delay;  and  who  shall,  except  the  first  year,  be  annually  elected  by 
the  stockholders,  where  there  are  such,  or  by  the  shareholders  or 
members,  where  there  are  no  stockholders,  at  such  meeting-,  time 
and  jilace,  and  after  such  notice  as  shall  be  directed  by  the  by-laws 
of  the  corporation ;  and  the  election  shall,  except  in  cases  otherwise 
provided  for  herein,  be  made  by  such  of  the  stockholders,  share- 
holders or  members,  as  the  case  maj^  be,  who  shall  attend  for  that 
purpose,  either  in  person  or  by  proxy;  and  where  no  other  notice  is 
provided  for  by  the  by-laws,  public  notice  of  the  time-  and  place 
of  holding  such  election  shall  be  published  not  less  than  ten  days 
previous  thereto,  in  a  newspaper  printed  nearest  to  the  place  where 
the  principal  office  of  said  corporation  in  this  State  shall  be  located. 

Darrin  vs.  Hoff,  99  Md.  491. 

Waiver — Ignorance  no  Excuse. 

On  the  question  of  waiver  the  court  adopts  a  doctrine  announced 
upon  this  same  subject  by  the  Supreme  Court  of  the  United  States, 
as  follows,  "The  Supreme  Court  of  the  United  States  speaking  by 
Mr.  Justice  Brown  said  in  dealing  with  that  feature  of  the  case: 
'Granting  that  the  continued  receipt  of  premiums  or  assessments, 
after  a  forfeiture  has  occurred,  will  only  be  construed  as  a  waiver 
when  the  facts  constituting  a  forfeiture  are  known  to  the  company. 
This  is  true  only  of  such  facts  as  are  peculiarly  within  the  knowl- 
edge of  the  insured.'  (N.  L.  L.  Insurance  Company  vs.  Davis,  95  U. 
S.  427 ;  Bennecke  vs.  Conn.  Mutual  Life  Insurance  Co.,  105  U.  S. 
355.)  If  the  company  ought  to  have  known  of  the  facts,  or  with 
proper  attention  to  its  own  business,  would  have  been  apprised 
of  them,  it  has  no  .right  to  set  up  its  ignorance  as  an  excuse." 

Monahan  vs.   Mutual  Life   Ins.   Company,  February   15th,   1906,   103 
Maryland  145. 


408  FRATERNAL    SOCIETY    LAW 

Age — Misrepresentation — Compromise. 

The  amount  due  under  a  contract  to  the  beneficiary  depended 
upon  the  true  age  of  the  member  at  the  time  when  he  obtained  the 
insurance.  The  company  claimed  that  the  true  age  was  not  stated 
in  the  member's  application  and  the  beneficiary  was  subsequently 
induced  to  accept  a  smaller  sum  than  would  be  payable  if  the  state- 
ment as  to  age  was  correct  and  executed  a  receipt  in  full  for  all 
claims  iinder  the  contract.  Held,  that  the  transaction  was  not  a 
compromise  of  the  disputed  claim  so  as  to  create  an  accord  and 
satisfaction ;  that  there  was  no  consideration  for  the  agreement  to 
accept  a  smaller  sum  in  satisfaction  of  the  claim,  and  that  the 
beneficiary  was  entitled  to  the  balance  under  the  contract  upon  the 
proof  that  the  age  of  the  insured  was  correctly  stated  in  the  appli- 
cation. 

Prudential    Life    Insurance    Company   vs.    Cottlngham,    March    27th, 
1906,  103  Maryland  319. 

Beneficiary  Cannot  Compel  Continuation  of  Membership. 

When  the  assured  voluntarily  elects  to  discontinue  payment  of 
assessments  and  dues  and  directs  the  cancellation  of  his  contract, 
the  beneficiary  named  therein  has  no  right  of  action  against  the 
company  on  the  ground  that  it  made  illegal  asse.ssments  upon  the 
member,  and  did  not  place  him  in  the  particular  class  to  which  he 
was  entitled  to  be  placed,  and  had  failed  to  set  aside  a  reserve  fund, 
the  court  holding  that  the  beneficiary  has  no  interest  in  the  con- 
tract further  than  to  claim  as  beneficiary  after  its  maturity,  while 
in  force. 

Price  vs.  Mutual  Reserve  Life  Ins.  Company,  January  9th,  190B,  102 
Maryland  683. 

Misrepresentation  Avoids  Contract. 

A  misrepresentation  as  to  a  subject  material  to  the  risk  made  by 
an  applicant  for  life  insurance,  avoids  the  contract  subsequently 
issued  upon  such  application,   although   the   applicant  made   such 


THE    STATE    OF    MARYLAND  409 

representations  in  good  faith  or  through  mistake.  It  is  held  that 
the  company  in  such  case  had  been  induced  to  take  a  different  risk 
from  that  which  the  representations  allowed  it  to  suppose  it  was 
assuming. 

Bankers'  Life  Insurance  Company  vs.   Miller,  November  18tli,  1904, 
100  Maryland  85. 

Limit  of  Time  to  Sue  in — Waiver  of  by  Society. 

The  contract  provided  that  suit  should  be  brought  within  six 
months  after  death  of  the  member  and  also  that  before  any  pay- 
ments should  be  made,  that  the  contract,  together  with  the  receipt 
book  should  be  surrendered.  After  the  death  of  a  member  the 
beneficiary  named  in  the  contract  notified  the  society,  and  was  told 
that  the  loss  would  be  paid  when  the  receipt  book  was  surrendered. 
The  beneficiary  replied  that  she  could  not  find  the  book,  and  that 
she  had  last  seen  it  in  the  possession  of  the  society's  agent,  when 
he  called  to  collect  the  premiums  which  she  had  paid.  Suit  was 
not  begun  on  the  contract  until  after  the  time  mentioned.  The 
court  held  that  the  question  of  whether  plaintiff  had  been  pre- 
vented from  bringing  suit  within  the  period  named,  by  the  conduct 
and  representations  of  the  society,  were  facts  to  be  passed  upon  by 
the  jury. 

The  Home   Friendless  .Society   vs.   Roberson.    November   30th,   1904, 
100  Maryland  85. 

Printed  By-laws  Admissible  in  Evidence. 

In  a  ease  where  the  printed  copy  of  the  laws  of  a  society  were 
admitted  in  evidence,  see : 

Wells  and  McComas  Council   vs.  Littleton,  January  13th,  1905,  100 
Maryland  416. 

Right  of  Beneficiary  to  Resort  to  Civil  Courts. 
A  beneficiary  was  held  not  to  be  required  to  appeal  to  a  higher 


410  FRATERNAL    SOCIETY    LAW 

authority  within  the  society  from  an  adverse  ruling  on  her  claim 
for  benefits  due  upon  the  death  of  a  member. 

Wells  and  McComas  Council  vs.  Littleton,  January  13th,  1905,  100 
Maryland  416. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

A  denial  by  an  insurer  of  all  liability  under  a  contract  is  a  waiver 
of  proofs  of  death. 

Prudential   Insurance  Co.  vs.   DeBoe,  January  20tli,  1904,  98  Mary- 
land 584. 

Reasonable  By-laws. 

A  by-law  in  a  fraternal  society  provided  that:  "No  brother  owing 
thirteen  weeks  or  more  dues  shall  be  entitled  to  receive  weekly  or 
death  benefits  until  thirteen  weeks- after  paying  all  arrears."  The 
court  in  passing  upon  the  validity  of  this  by-law,  where  it  was 
attacked  on  the  ground  of  being  unreasonable,  reviewed  the  author- 
ities and  held  that  the  by-law  was  not  unreasonable. 

Littleton   vs.   Wells   and   McComas  Council,   January  12th,   1905,   98 
Maryland  453. 

Beneficiary — Remedies  in  Society  to  be  Exhausted  Before  Resort  is 
Made  to  Civil  Courts. 

A  benefit  society  issued  a  certificate  to  a  member  promising  to  pay 
to  his  wife,  as  beneficiary,  in  the  event  of  the  death  of  the  member 
occurring  during  the  continuation  of  his  membership,  a  certain  sum. 
The  by-laws  of  the  society  required  that  all  claims  made  upon  cer- 
tificate should  be  first  passed  upon  by  the  executive  committee;  that 
any  beneficiary  dissatisfied  with  the  decision  made  by  the  executive 
committee  must  appeal  therefrom  to  the  Grand  Council  of  the  soci- 
ety. The  beneficiary  named  upon  the  death  of  her  husband,  applied 
for  the  piiyiiieiit  ol'  tlie  amount  due  by  the  certificate,  but  the 
executive  ennunitti'O  decided  that  slu'  was  entitled  to  only  a  small 


THE    STATE    OF    MARYLAND  411 

portion  of  hov  claim.  She  refused  to  accept  tliis  and  refused  to 
appeal,  and  ijrouglit  suit.  Tlie  society  filed  ii  denuirrcr  settiufi' 
forth  the  facts  referred  to  above  and  the  court  held  that  plaintiff, 
under  the  regulations  of  the  society,  although  only  a  Ixmeficiary  and 
not  a  member,  was  precluded  from  bringing  suit  upon  the  certificate 
until  after  exhausting  the  remedies  granted  her  within  the  organiza- 
tion. The  authorities  are  reviewed  at  great  length  in  the  briefs  filed 
before  the  court  and  the  question  fairly  raised. 

Weigand  vs.  Fraternity's  Accident  Order,  June  30th,  1903,  97  Mary- 
land 443. 

Beneficiaries — Benefits  Exempt  from  Creditor's  Claims,  Etc. 

The  by-laws  of  the  Improved  Order  of  Heptasoph's  designated 
the  class  of  persons  that  might  be  named  as  beneficiaries  by 
members  of  the  society,  such  persons  being  confined  to  blood 
relations,  or  to  persons  depending  upon  the  member  for  main- 
tenance, food,  clothing,  lodging  or  education,  and  further  pro- 
vided that  the  member  .should  not  designate  by  will  to  whom  the 
benefits  should  be  paid,  nor  be  permitted  to  sell  or  assign  his  cer- 
tificate or  any  portion  thereof.  A  certificate  was  issued  to  one 
Brumbly,  payable  at  his  death  to  his  four  children  named  therein, 
and  to  all  his  surviving  children;  subsequently  this  certificate  was 
surrendered  and  a  new  one  issued  payable  to  the  member's  "estate." 
This  last  named  certificate  was  endorsed  over  to  Peter  Dale,  as 
collateral  security  for  a  debt  owed  by  the  member  to  Dale.  After 
the  death  of  the  member,  the  fund  under  the  certificate  was  brought 
into  court  under  a  bill  of  interpleader.  The  society  disclaimed  any 
interest  in  the  fund.  At  the  time  the  last  named  certificate  was 
issued,  a  statute  of  Maryland  was  in  force  designating  who  might  be 
named  as  beneficiaries  by  members  of  fraternal  societies,  providing 
that  such  funds  should  not  be  liable  to  be  seized  under  any  legal 
process  for  any  debt  or  liability  of  the  certificate  holder  and  that 
the  benefit  should  not  be.  assignable  except  to  those  named  in  the 
act  as  competent  to  take  as  beneficiaries  and  creditors  were  not  in 
the  li.st.  The  court  said.  "The  association  would  have  no  power 
whatever  under  its  constitution  and  the  laws  of  the  State  to  pay 
the  fund  to  a  creditor  of  the  deceased. 


412  FRATERNAL    SOCIETY    LAW 

"We  come  then  to  the  meaning  of  the  construction  to  be  placed 
upon  the  word  'estate'  as  designated  by  the  assured  in  the  certifi- 
cate dated  January  17th,  1889.  In  the  view  we  take  of  this  case  it 
becomes  immaterial  whether  we  hold  that  the  fund  shall  be  paid 
to  the  administrators  of  the  assured,  Brumblj^,  and  distributed  ac- 
cording to  the  laws  of  the  State,  of  whether  we  declare  that  the 
word  'estate'  was  an  illegal  designation.  In  either  ease  the  fund 
would   be   distributed   to   the   same   persons.  #  #  » 

The  decree  of  the  lower  court  directed  th  fund  to  be  paid  to  the 
wife  and  children  of  the  assured,  as  the  persons  entitled,  free  and 
clear  of  the  claims  of  creditors,  and  for  the  reasons  given  we  affirm 
the  decree  appealed  from." 

Dale  vs.  Brumbly,  March  31st,  1903,  96  Maryland  674. 

Forfeiture — Waiver  of. 

For  the  facts  in  an  interesting  case  where  forfeiture  of  a  contract 
was  alleged  by  reason  of  non-payment  of  assessments,  and  where  it 
further  appears  that  the  assessments  were  not  paid  by  reason  of  the 
failure  of  a  subordinate  lodge  to  comply  with  the  laws  of  the  society, 
and  where  upon  such  facts  the  society  was  held  to  have  waived  the 
forfeiture,  see: 

Schlosser  vs.  Grabd  Lodge  Brotherhood  of  R.  R.  Trainmen,  January 
16th,  1902,  94  Maryland  363. 

Payment  of  Assessments  After  Member's  Death. 

A  contract  provided  that  failure  to  pay  assessment  when  due 
should  cause  its  forfeiture,  and  that  it  could  not  be  reinstated  ex- 
cept in  a  designated  manner  with  the  consent  of  the  company.  It 
was  held  that  the  payment  of  an  assessment  after  maturity  and 
after  the  forfeiture  of  the  contract  without  its  reinstatement  in  the 
manner  provided  for  in  the  laws,  would  not  operate  to  create  a 
waiver  of  the  forfeiture,  or  to  revive  the  contract,  and  that  upon  the 
subsequent  insolvency  of  the  company,  the  holder  of  such  contract 


THE    STATE    OF    MARYLAND  413 

was  not  liable  for  assessments  ordered  to  be  made  by  a  court  in  the 
domicile  of  the  corporation. 

Stockley  vs.  Benedict,  January  16th,  1901,  92  Maryland  325. 

A  Maryland  Contract. 

A  benefit  certificate  was  issued  in  New  York  to  a  member  residing 
in  Maryland,  delivered  in  Maryland,  and  the  court  held  that  it  pro- 
vided for  payment  in  Maryland,  and  upon  these  facts  it  was  held, 
that  the  certificate  was  a  Maryland  contract,  and  the  rights  of  the 
parties  thereunder  were  to  be  governed  according  to  the  laws  of 
that  State. 

Expressmen's  Mutual  Benefit  Ass'n  vs.  Hurlock,  June  16th,  1900,  91 
Maryland  585. 

Courts    Without   Power   to    Control    Internal   Affairs    of   Foreign 
Society. 

A  member  of  a  mutual  life  insurance  company,  operated  on  the 
assessment  plan,  is  an  insurer  of  others  as  well  as  himself.  An 
action  on  a  policy  to  recover  a  loss  insured  against  would  be  within 
the  jurisdiction  of  the  courts  of  this  State.  -  But  a  suit  to  determine 
whether  certain  assessments  of  a  foreign  company  were  fraudulently 
and  irregularly  made  and  to  enjoin  the  forfeiture  of  a  contract  for 
non-payment  thereof,  was  held  to  involve  an  inquiry  into  the  in- 
ternal management  of  a  foreign  corporation  and  is  not  within  the 
jurisdiction  of  the  courts  of 'the  State. 

Condon  vs.  Mutual  Reserve  Fund  Life  Ass'n,  March  14th,  1S99,  89 
Maryland  99. 

Contracts — Rules  of  Construction. 

A  contract  of  insurance  is  to  be  construed  according  to  the  con- 
stitution and  laws  of  the  society  and  the  laws  of  its  domicile. 

Condon  vs.  Mutual  Reserve  Fund  Life  Ass'n,  March  14th.  1899,  89 
Maryland  99. 


414  FRATERNAL    SOCIETY    LAW 

Courts  Will  Not  Interfere  With  Internal  Affairs  of  Foreign  Society. 

The  plaintiff  filed  a  liill  alleging  that  his  assessments  had  been 
fraudulently  and  illegally  increased  in  amount  by  the  society  for 
the  purpose  of  forcing  him  to  lapse,  and  that  the  amount  the  society 
assigned  to  him  in  the  reserve  fund  was  less  than  the  amount  due 
upon  a  true  accounting.  The  bill  asked  for  an  injunction  restrain- 
ing the  forfeiture  of  plaintiff's  contract  for  non-payment  of  the 
extra  assessment,  and  for  an  accounting  of  the  assets  and  receipts 
and  for  the  appointment  of  a  receiver.  It  was  held  that  the  ques- 
tion of  whether  the  condition  of  the  company  required  the  levy  of 
extra  assessments  and  whether  they  were  unnecessary  and  fraudu- 
lent, could  not  be  determined  until  the  whole  management  of  the 
association  and  an  accounting  made  of  its  liabilities  and  assets, 
funds  on  hand  and  claims  shoidd  be  made  and  that  since  this  in- 
volved an  inquiry  into  the  internal  affairs  of  a  foreign  corporation 
the  courts  of  this  State  have  no  jurisdiction  to  maintain  the  bill. 

Condon  vs.  Mutual  Reserve  Fund  Life  Ass'n,  March  14th,   1S99,  89 
Maryland  99. 

Beneficiary — Death  of  Before  Member. 

The  member's  beneficiary  died  during  his  lifetime  and  he  failed 
to  designate  another.  The  laws  of  the  society  provided  that  the 
member  had  a  right  to  change  the  beneficiary  at  will  and  for  the 
distribution  of  the  fiuid  upon  the  death  of  the  member,  in  case  he 
did  not  designate  a  beneficiary,  but  no  provision  was  made  for  the 
distribution  of  the  fund,  in  the  event  'of  death  of  the  beneficiary 
during  the  lifetime  of  the  member,  and  no  new  designation  having 
been  made.  It  was  held  that  the  proceeds  of  the  certificate  in  ques- 
tion were  payable  to  the  administrator  of  the  wife,  her  interests 
being  the  same  or  similar  to  tliat  of  a  beneficiary  in  an  ordinary  life 
insurance  policy,  and  that  the  fact  that  her  husband,  the  member, 
attempted  to  dispose  of  the  fund  by  his  will  made  no  difference, 
because  he  had  no  property  interest  in  the  certificate,  but  only  a 
power  to  designate  a  beneficiary  in  the  manner  prescribed  by  the 
by-laws  of  the  association.  This  was  an  interpleader  case.  The 
claim  for  the  fund  was  made  bA'  the  member's  executor,  the  admin- 


THE   STATE   OF   MARYLAND  415 

istrator  of  the  mpmher's  wife,  the  member's  surviving  eliililreii,  and 
children  of  liis  deceased  children,  and  the  court  said:  "The  designa- 
tion by  Mr.  Herring  of  his  wife,  Ann  M.  Herring,  as  his  beneficiary, 
when  he  joined  the  assoeiittion,  eonferrcd  upnn  her  ;i  beneficial  in- 
terest in  the  proceeds  of  the  policy  when  dnc.  The  estate  thus 
acquired  by  her  of  the  insurance  and  its  proceeds,  although  it  was 
liable  to  have  been  defeated  by  the  ai)pointnient  of  a  new  beneficiary 
by  her  husband,  if  he  had  made  a  new  appointment,  possessed  th^ 
inherent  qualities  of  the  estate  of  the  beneficiary  under  an  ordinary 
policy  of  life  insurance  and  was  a  valuable  asset,  which  at  her  death 
devolved  upon  her  administrator.  The  title  of  the  administrator 
would  have  been  divested  after  her  death  if  the  husband  had  in  his 
lifetime  designated  a  new  beneficiary  in  the  manner  prescribed  by 
the  by-laws  of  the  association." 

Thomas  vs.   Cochran,  June  20th,  1S98,  89  Maryland  390. 

Assignment  of  Certificate  Valid  Unless  Prohibited. 

A  benefit  cei'tificate  was  assigned  by  a  member  and  his  wife,  the 
designated  beneficiary,  to  an  existing  creditor  in  satisfaction  of  the 
member's  debt  to  the  cx-editor,  and  the  latter  thereafter  paid  the 
assessment  upon  the  certificate.  On  the  death  of  the  member  the 
beneficiary  alleged  that  the  true  intent  of  the  parties  was  that  she 
should  receive  the  amount  of  the  certificate,  less  the  claim  of  the 
creditor  and  that  a  writing  of  an  absolute  assignment  was  fraudu- 
lent. The  question  was  also  raised  in  the  case  as  to  whether  the 
assignment  could  be  enforced  in  an  action  at  law.  The  court  held 
that  inasmuch  as  the  by-laws  did  not  prohibit  an  assignment,  that 
the  certificate  was  assignable,  and  that  the  creditor  was  entitled  to 
the  fund. 

Clogg  vs.  McDaniel,  June  20th,  1899,  89  Maryland  416. 

What  State  Laws  Govern — Misrepresentation. 

A  certificate  was  issued  by  the  Royal  Arcanum  at  its  home  office 
in  JIassaehusetts  to  a  resident  of  ^Maryland.     The  statute  of  ilassa- 


416  FRATERNAL    SOCIETY    LAW 

chusetts  provided  that,  ' '  When  any  certificate  is  issued  to  a  resident 
of  the  commonwealth,  by  any  fraternal  beneficiary  corporation  or- 
ganized under  the  laws  of"  that  commonwealth,  that  a  misrepre- 
sentation in  the  application  should  not  avoid  the  certificate  unless 
the  misrepresentation  was  made  with  actual  intent  to  deceive  in 
regard  to  the  matter  misrepresented,  and  thereby  increasing  the 
risk.  The  court  in  Maryland  passing  upon  this  case  held  that  the 
act  of  the  Massachusetts  legislature  applied  only  to  certificates 
issued  to  residents  of  that  commonwealth,  yet  since  in  benefit  socie- 
ties all  members  should  be  treated  alike,  the  certificate  should  be 
construed  as  though  the  member  was  a  resident  of  Massachusetts, 
and  the  suit  pending  in  the  courts  of  that  State. 

Supreme  Council  Royal  Arcanum  vs.  Brashears,  June  22nd,  1899,  89 
Maryland  624. 

Suicide — Presumptions  Against. 

Where  it  appears  that  the  death  of  a  member  was  caused  by  sui- 
cide or  accident,  and  the  proven  facts  do  not  show  which,  the  pre- 
sumption is  that  death  was  from  accident. 

Travelers'  Insurance  Co.  vs.  Nicklas,  November  17th,  1898,  88  Mary- 
land, 470. 

Valid  Requirements  for  Proofs  of  Loss  to  be  Filed  Within  Short 
Time. 

A  condition  of  a  contract  of  insurance  requiring  proofs  of  loss  to 
be  made  within  60  days  after  the  loss  occurs  is  held  to  be  valid. 

Caledonian  Fire  Insurance  Co.  vs.  Traub,  June  23rd,  1897,  86  Mary- 
land 86. 

Charter  Powers  of  Societies. 

For  an  interesting  case  involving  the  exercise  of  powers  by  a  fra- 
ternal society,  the  limitations  upon  such,  societies,  by-laws,  power  to 
enact  and  the  forfeiture  of  their  charters  for  violation  of  their 
powers,  see  case  of: 


THB    STATE    OF   MARYLAND  417 

International  Fraternal  Alliance  vs.  State  of  Maryland,  January  4th, 
1898,  86  Maryland  550. 

Exclusive  Jurisdiction  in  Tribunals  of  Societies. 

"Where  the  tribunals  of  a  fraternal  society  have  the  power  to  de- 
cide disputed  questions,  their  jurisdiction  is  exclusive,  whether 
there  be  a  by-law  of  the  society  stating  such  decisions  to  be  final 
or  not,  and  the  courts  cannot  be  invoked  to  review  their  decisions 
of  questions  coming  properly  before  them,  except  in  cases  of  fraud. 

Donnelly   vs.    Supreme   Council    Catholic    Benevolent    Legion,    June, 
1906,  Court  of  Appeals  of  Maryland,  67  Atl.  276. 

Members  Bound  by  Laws  Though  Ignorant  of  Them. 

A  member  is  bound  by  all  the  laws  in  force  at  the  date  of  his 
joining  the  society,  whether  such  laws  be  specifically  called  to  his 
attention  or  not. 


Donnelly   vs.    Supreme    Council    Catholic    Benevolent    Legion,    June, 
1906,  Court  of  Appeals  of  Maryland,  67  Atl.  276. 

27 


41g  FRATERNAL    SOCIETY   LAW 


THE 

STATE  OF  MASSACHUSETTS. 

CHAPTER  22. 
(Chapter  119,  Eevised  Laws.) 

Section  1.  Seven  or  more  persons,  residents  of  this  common- 
wealth, may  form  a  fraternal  beneficiary  corporation  for  the  pur- 
pose of  providing' for  the  payment  of  benefits  in  the  case  of  death 
or  disability,  or  of  both.  The  disability  may  be  temporary  or  perma- 
nent and  the  result  of  sickness  or  of  accident.  Any  educational, 
charitable,  benevolent  or  social  purpose  may  be  united  therewith. 

The  membership  may  be  limited  to  members  of  a  particular  order, 
class  or  fraternity-,  to  the  employees  of  towns  or  cities,  the  common- 
wealth, or  the  federal  government,  or  of  a  designated  firm,  business 
house  or  corporation ;  or  to  persons  of  the  same  occupation. 

If  its  membership  is  not  limited  as  above  provided,  its  business 
shall  be  conducted  on  the  lodge  system,  with  a  representative  form 
of  government,  and,  in  such  case,  the  incorporators,  their  successors 
and  associates,  with  the  officers,  ex-presiding  officers,  and  such  per- 
sons as  may  be  admitted  as  representatives,  shall  be  a  supreme  or 
governing  body,  with  power  to  create  subordinate  bodies  by  the 
grant  to  applicants  therefor  of  charters  authorizing  those  named 
therein  to  organize  as  a  subordinate  lodge  and  to  admit  members 
after  its  organization,  in  accordance  with  such  ritual  as  the  supreme 
or  governing  body  may  prescribe. 

Section  2.  The  corporation  shall  be  formed  in  the  manner  pre- 
scribed in.  and  be  subject  to  the  provisions  of,  sections  fifteen  to 


rUil    STATE    OF    MASSACHUtil'JTTti  419 

twenty,  inclusive,  oi'  ('lia))ter  one  hundretl  and  ten,  except  as  foUow.s: 

The  agreement  shall  nmit  llie  statement  of  the  amount  of  its 
capital  stock  and  llic  paf  \alue  and  number  of  its  sinires. 

All  officers  shall  lie  elected  by  ballot  and  the  presidi'iit  shall 
be  included  among-  the  officers  to  be  electetl  at  the  first  meeting 
by  the  associates,  and  no  person  who  has  not  subscribed  the;  agree- 
ment of  association  shall  be  eligible  as  a  director  or  other  officer. 

The  provisions  of  section  six  of  chapter  one  hundred  and  twenty- 
five  shall  apply  to  such  corporation,  except  that  the  financial  officer 
shall  not  be  required  to  sign  or  make  oath  to  the  certificate  of 
organization. 

The  b.y-laws  nuiy,  unless  it  is  otherwise  provided,  also  prescribe 
the  officers  and  elective  members  of  standing  committees,  who  may 
he,  exofficios,  directors  or  other  officers  corresponding  thereto ;  the 
method  of  calling  its  meetings  ami  the  notice  tliereof  which  shall  be 
given;  the  right  of  attendance,  individual  or  representative,  at  its 
meetings;  the  assessments  and  benefits  in  ease  of  disability  or  death, 
and  the  conditions  upon  which  the  same  shall  l)e  j);iid ;  the  amount 
which  shall  be  deemed  one  full  individual  assessment  for  the  respec- 
tive funds  and  for  calls  for  fractional  parts  thereof;  and  the  loss 
or  forfeiture  of  membership  and  benetits,  the  method  of  the  amend- 
ment of  the  by-laws  and  such  other  provisions  as  the  corporation 
may  determine. 

Lf  the  corporation  conducts  its  business  as  a  fratei'nal  society  on 
the  lodge  system,  it  shall  have  a  ritualistic  form  of  work  and  no 
person  shall  be  admitted  as  a  member  thereof  unless  he  has  pre- 
viously made  a  written  application  therefor,  and  has  been  initiated 
in,  and  become  a  member  of,  a  local  branch  of  said  corporation.  Its. 
by-laws  shall  provide  that  meetings  of  said  branches  shall  be  held 
at  least  once  each  month,  and  may  provide  that,  in  addition  to  repre- 
sentatives chosen  by  the  grand  or  subordinate  bodies,  the  incorpora- 
tors, officers,  members  of  standing  committees  and  the  ex-presiding 
officers  of  the  supreme  or  governing  body  may  be  members  thereof. 

The  certificate  of  organization  and  the  records  shall  be  submitted 
to  the  insurance  commissioner,  instead  of  the  commissioner  of  cor- 
porations, and  he  shall  perform  the  duties  relative  thereto  which  are 
reqidred  of  the  commissioner  of  corporations  relative  to  manufact- 
;n"ing  corporations. 


420  FRATERNAL    SOCIETY    LAW 

The  fees  to  be  paid  to  the  secretary  of  the  commonwealth  upon  the 
filing  of  the  certificate  of  organization  shall  be  five  dollars. 

Section  3.  Officers  chosen  at  the  first  meeting  of  the  association 
shall  hold  office  until  the  next  meeting  of  the  corporation  for  the 
election  of  officers,  the  date  of  which,  within  two  years  of  the  time 
of  organization,  shall  be  prescribed  by  the  by-laws.  At  such  meet- 
ing, and  thereafter  at  least  biennially,  the  officers  shall  be  chosen  by 
ballot  and  shall  hold  office  until  their  successors  are  elected  and 
qualified.  Standing  committees  or  boards  having  prescribed  duties 
under  the  bj'-laws,  including  those  the  members  of  which  are  by 
such  by-laws  made  directors  or  other  officers  corresponding  thereto, 
may  be  constituted  by  the  election  of  one  or  more  members  thereof 
annually,  to  serve  for  not  more  than  three  years  under  any  one 
election.  No  person  shall  be  elected  or  appointed  to  an  administra- 
tive position  for  more  than  three  years  at  any  one  election  or  ap- 
pointment. 

Section  4.  No  corporation  organized  as  aforesaid  subsequent  to 
the  twenty-third  day  of  May  in  the  year  nineteen  hundred  and  oue 
to  conduct  business  as  a  fraternal  society  on  the  lodge  system,  or 
w^hieh  limits  its  membership  to  a  particular  order  or  fraternity,  shall 
incur  any  liability  or  issue  anj"  benefit  certificate  until  it  has  re- 
ceived from  the  insurance  commissioner  a  certificate  to  the  eft'eet 
that  it  has  complied  with  all  the  requirements  of  law  and  is  duly 
authorized  to  transact  business  in  this  commonwealth ;  but  the  fore- 
going provisions  shall  not  apply  to  a  eorpoi-ation  which  confines  its 
membership  to  that  of  a  particular  order  or  fraternity  in  any  one 
county,  or  to  a  lodge  of  such  order  or  fraternity.  Before  such  cer- 
tificate is  granted,  the  corporation  must  present  satisfactory  evi- 
dence to  the  insurance  commissioner  that  at  least  five  hundred  per- 
sons have  each  paid  one  advance  assessment  for  its  iiiortuarv  or  dis- 
ability business,  or  both  if  such  business  is  combined,  at  its  estab- 
lished rates,  and  have  become  bona  fide  members  of  the  corporation. 
If  such  corporation  is  a  fraternal  society  on  the  lodge  system,  pa.ving 
a  death  benefit,  it  must  also  show  that  it  has  established  mortuary 
assessment  rates  which  are  not  lower  than  those  indicated  as  neces- 
sary on  till'  twenty-third  <la\'  of  Ma\'  in  the  year  nineteen  hundred 
anil   iiiir   li\-  the  ■"Natinnnl    l<'r,itri'nal   Cinmress  Mortalitv  Tables." 


THE    STATE    OF    MAtlSACHUSETTS  421 

unless  it  is  a  fraternal  beneficiary  corporation  which  confines  its 
membership  to  the  employees  of  towns  or  cities,  the  commonwealth, 
the  federal  government,  of  a  designated  firm,  business  house  or  cor- 
poration, or  to  persons  ol'  the  same  occui)ation. 

Section  5.  A  domestic  corporation  subject  to  the  provisions  of 
this  chapter  may  hold  its  annual  meetings  in  any  State,  in  the  Dis- 
trict of  Columbia,  or  in  the  Dominion  of  Canada  or  a  province 
thereof,  if  in  such  State,  district  or  province  it  has  one  or  more  local 
branches;  and  its  acts  at  such  meetings  shall  have  the  same  effect 
as  if  done  within  this  commonwealth. 

Section  6.  A  corporation  duly  organized  and  transacting  busi- 
ness under  the  provisions  of  this  chapter,  which  conducts  its  business 
as  a  fraternal  society  on  the  lodge  system,  or  which  limits  its  certifi- 
cate holders  to  a  particular  order,  class  or  fraternity,  or  to  the  em- 
ployees of  towns  or  cities,  the  commonwealth,  or  the  federal  govern- 
ment, or  of  a  designated  firm,  business  house  or  corporation,  or  to 
persons  of  the  same  occupation,  may  make  provision  for  the  pay- 
ment of  benefits  in  ease  of  death  or  disability  or  of  both.  The  funds 
from  which  the  payment  of  such  benefits  shall  be  made  shall  be 
derived  only  from  assessments  collected  from  the  members,  except 
as  provided  in  sections  eight,  nine  and  ten.  The  fund  from  which 
the  expenses  shall  be  defrayed  may  be  derived  from  a  per  capita 
tax,  dues  or  expense  assessments.  Such  provisions,  funds,  assess- 
ments and  payments  shall  be  as  required  in  the  by-laws  of  the  cor- 
poration. The  benefit  certificate  shall,  in  effect,  provide  that  if  the 
death  of  the  member  therein  named  shall  occur  when  one  full  assess- 
ment on  each  member  would  not  amount  to  the  face  amount  of  the 
maximum  certificate  of  sucli  corporation,  then  the  amount  paid  the 
beneficiary  thereunder  shall  not  exceed  the  amount  of  such  full 
assessment  or  the  proportionate  part  thereof  which  said  face  amount 
named  in  such  certificate  bears  to  sucli  maximum  certificate,  but 
this  restriction  shall  not  apply  to  a  corporation  which  confines  its 
membership  to  the  permanent  employees  of  towns  or  cities,  the  com- 
monwealth, or  the  federal  government,  nor  to  a  corporation  having 
an  emergency  or  reserve  fund,  imtil  such  fund  shall  have  been  ex- 
hausted. Such  death  benefit  shall  be  payable  only  to  the  husband, 
wife,  betrothed,  child  by  legal  adoption,  parent  by  legal  adoption, 


422  FRATERNAL    HOGIETY    LAW 

or  relatives  of.  or  persons  dependent  upon,  the  member  named  in 
the  benefit  certificate;  bnt  a  member  of  any  fraternal  beneficiary 
corporation  may,  with  the  consent  of  tlie  officers  thereof,  name  as 
beneficiary  a  home  located  within  this  commonwealth  and  incorpo- 
rated under  the  laws  thereof,  and  maintained  and  supported  by  any 
secret  fraternity  or  order  for  the  care  and  maintenance  of  its  aged, 
infirm,  indigent  or  unfortunate  members,  or  for  the  care  and  support 
of  the  wife  or  widow  of  such  member,  or  for  the  care,  support  and 
education  of  minor  children  of  such  members  or  of  deceased  members, 
to  the  extent  of  the  amount  disbursed  for  the  benefit  of  said  member, 
wife,  widow  or  child,  by  .such  home,  at  rate  of  average  cost  of 
maintenance  thereof,  during-  the  period  of  occupancy  of  such  mem- 
ber, wife,  widow  or  child,  Avith  any  sums  expended  for  assessments, 
dues,  tax  or  other  payments  by  such  home  by  reason  of  such  benefit 
certificates;  and,  subject  to  the  limitations  of  this  section,  another 
I^erson  as  beneficiary  of  the  remainder.  If  a  benefit  certificate  has 
been  lawfully  issued  and  the  beneficiary  therein  named  and  the  hus- 
band, wife,  betrothed,  child,  child  by  legal  adoj)tion,  parent,  jiareut 
b.v  legal  adoption,  or  persons  dependent  upon  the  member  named 
in  the  benefit  certificate  have  all  died,  the  member  with  the  consent 
of  the  officers  of  the  corporation,  and  under  such  rules  as  they  may 
prescribe,  may  have  any  other  person  substituted  as  beneficiary 
therein. 

Section  7.  A  corporation  organized  under  or  conducting  its  busi- 
ness in  accordance  with  the  provisions  of  this  chapter  may  hold  as 
a  death  fund  belonging  to  the  beneficiaries  of  members  when  de- 
ceased not  more  than  the  amount  of  thi-ee  a.ssessments  from  a  gen- 
ei'al  or  unlimited  membership,  or  of  three  assessments  from  each 
limited  class  or  division  of  its  members;  and  in  addition  thereto  may 
create,  collect,  maintain,  disburse  and  apply  an  emergency  fund  in 
accordance  with  its  by-laws,  not  however  at  any  time  exceeding 
in  amount  collected  from  its  members  five  per  cent,  of  the  aggregate 
face  value  of  all  its  then  outstanding  benefit  certificates.  If  any  i>art 
of  such  fimd  jwiyable  by  a  member  under  such  by-laws  remains  un- 
paid at  his  decease,  it  nuiy  be  deducted  from  the  amount  payable  to 
his  betiefieiary  or  benefir-iaries;  but  any  decrease  in  such  face  value 
shall    not   require  a    corresponding  diminution    of  such    emergency 


THE    STATE    OF   MASSACHUSETTS  423 

fund.  The  emergency  fund  shall  be  used  only  for  the  payment  of 
death  or  disability  benefits.  Such  death  fund  while  held  in  trust 
shall  be  invested  in  securities  in  which  insurance  companies  may  in- 
vest their  capital,  or  deposited  in  safe  banking  institutions  subject 
to  sight  drafts,  for  distribution  to  the  beneficiaries  aforesaid.  When- 
ever the  death  fund  exceeds,  above  all  known  liabilities,  the 
amount  of  three  assessments  as  aforesaid,  .such  excess  shall  be  trans- 
ferred to  the  emergency  fund.  Such  emergency  fund  shall  be  in- 
vested in  securities  in  which  insurance  companies  may  invest  their 
capital,  but  a  part  thereof,  not  exceeding  twenty  per  cent,  may  be 
invested  in  a  building  for  vise  and  occupancy  by  the  corporation  as 
its  home  office  within  this  commonwealth.  Such  securities,  if  regis- 
tered or  recorded,  sliall  be  taken  and  stand  in  the  name  of  the  cor- 
poration, and  all  the  securities  in  which  the  emergency  fund  is  in- 
vested shall  be  deposited  with  the  treasurer  and  receiver  general; 
but  the  corporation  may  at  any  time  exhange  any  part  of  said 
securities  for  other  authorized  securities  which  the  treasurer  and 
receiver  general  determines  are  of  equal  value.  No  part  of  said  se- 
curities shall  be  withdrawn  except  upon  a  requisition  signed  by 
three-fourths  of  the  directors  or  executive  committee,  or  other  offi- 
cers corresponding  thereto,  and  indorsed  by  the  insurance  commis- 
sioner, setting  forth  that  the  same  is  to  be  used  for  the  purposes  of 
the  trust.  The  income  from  securities  so  deposited  shall  be  paid  to 
the  corporation  for  the  uses  of  the  fund  as  specified  in  the  by-laws. 
No  sale,  assignment,  release,  discharge,  or  surrender  of  securities 
so  deposited  to  or  in  favor  of  any  obligor,  mortgagor  or  other  person, 
shall  be  valid  against  the  corporation  owning  the  same,  unless  the 
original  papers  which  constitute,  or  are  the  evidence  of,  said  securi- 
ties, are  transferred  or  surrendered  to  the  person  entitled  thereto, 
except  in  case  of  the  actual  loss  or  destruction  thereof. 

Section  8.  No  part  of  the  death,  disability,  or  emergency  funds 
herein  provided  for  shall  be  used  for  any  purposes  other  than  those 
specifically  prescribed  in  this  chapter,  and  no  assessment  for  the 
disability  fund  shall  be  called  while  there  remains  on  hand  of  such 
fund  an  amount  equal  to  that  received  from  three  assessments ;  but 
payments  for  total  permanent  disability  may  be  made  from  the 
death  fund  if  made  in  a  single  payment. 


424  FRATERNAL    SOCIETY    LAW 

No  contract  under  this  chapter  shall  be  valid  which  shall  be  con- 
ditional upon  an  agreement  or  understanding  that  the  person  to 
whona  the  death  benefit  is  made  payable  shall  pay  the  dues  or  assess- 
ments. Death,  disability  and  expense  assessments  may  be  called 
together;  but  the  proportion  to  be  used  for  each  purpose  shall  be 
distinctly  stated  and  the  amount  received  for  each  fund  shall  be 
held  and  used  only  in  the  manner  heretofore  sfjecified;  but  trans- 
fers from  the  expense  fund  to  any  other  fund  may  be  made  by  the 
directors. 

Section  9.  A  domestic  corporation  subject  to  the  provisions  of 
this  chapter,  in  addition  to  the  revenues  in  this  chapter  provided, 
may  receive  and  hold  gifts,  bequests  and  money  from  other  sources, 
which  shall  be  held  in  a  separate  fund;  subject  however  to  transfer 
in  accordance  with  its  by-laws  to  funds  herein  authorized. 

Section  10.  A  corporation  organized  under  or  conducting  its 
business  in  accordance  with  the  provisions  of  this  chapter,  which 
on  the  twenty-eighth  day  of  June  in  the  year  eighteen  hundred  and 
ninety-nine  was,  or  the  members  of  which  then  formed,  a  part  or 
jurisdiction  of  one  general  order  or  fraternity  conducted  on  the  lodge 
system  and  paying  only  death,  sick,  disability  or  old  age  benefits, 
and  having  a  common  name  and  ritualistic  ceremonies,  and  which 
corporation  was  then  in  affiliation  with  the  supreme  or  governing 
body  of  such  order  or  fraternity,  may  continue  to  affiliate  with  and 
contribute  to  the  support  of  such  supreme  body  under  the  methods 
and  laws  then  existing,  or  which  have  been  or  hereafter  may  be 
adopted  by  both  said  corporation  and  supreme  body,  and  in  addition 
to  the  other  rights  and  authority  conferred  by  this  chapter  may  by 
assessments  or  through  its  other  funds  provide  for  death  benefits 
and  the  payment  thereof,  and  maj'  pay  death  benefits,  to  or  for  the 
beneficiaries  of  deceased  members  of  such  order  or  fraternity,  hold- 
ing benefit  certificates  issued  not  by  said  corporation  but  by  said 
supreme  body  or  bj^  one  of  the  grand  or  subordinate  bodies  thereof 
organized  or  incorporated  elsewhere  than  in  this  commonwealth, 
imder  an  arrangement  or  agreement  with  said  supreme  body  and 
in  compliance  with  the  laws  or  rules  thereof,  whereby  said  corpora- 
tion may  afford  relief  and  aid  by  payment  of  or  for  such  death 
benefits  as  aforesaid,  or  itself  receive  similar  payments  for  relief  and 


THE    STATE    OF   MASSACHUSETTS  425 

aid  to  the  beneficiaries  of  its  deceased  members  as  the  case  may 
require  and  such  laws  and  rules  provide ;  but  this  authority  shall 
not  permit  the  payment  of  benefits  other  than  those  arising  from 
death. 

Section  11.  A  corporation  organized  under  or  conducting  its  busi- 
ness in  accordance  with  the  provisions  of  tliis  chapter,  and  which 
has  no  provision  for  a  per  capita  tax,  or  for  dues  payable  to  the 
supreme  or  governing  body  for  expenses,  may  make  not  more  than 
three  assessments  a  year,  to  meet  its  reasonably  necessary  expenses. 
The  purpose  of  such  asses-sments  shall  be  clearly  stated  in  calls  there- 
for, and  no  expense  assessment  shall  be  called  while  the  amount  of 
one  assessment  remains  on  hand. 

A  corporation  organized  as  aforesaid  which  limits  its  membership 
to  the  permanent  employees  of  towns  or  cities,  the  commonwealth,  or 
the  federal  government,  and  which  does  not  pay  death  benefits,  may 
pay  annuities  or  gratuities  contingent  upon  disability  or  long  service, 
and  may  fix  the  amount  of  the  annual  assessment  therefor. 

A  corporation  which  is  subject  to  the  provisions  of  this  chapter 
may  reinsure  with  or  transfer  its  membership,  certificates  or  funds 
to  any  other  corporation  or  organization  which  is  authorized  to  do 
business  under  this  chapter  in  this  commonwealth.  The  agreement 
of  transfer  or  reinsurance  shall  first  be  submitted  to  and  approved 
by  a  two-thirds  vote  of  the  certificate  holders  of  each  corporation 
or  organization  present  at  meetings  called  to  consider  the  same,  of 
which  meetings  written  or  printed  notice  shall  be  mailed  to  each 
certificate  holder  at  least  thirty  days  before  the  day  fixed  for  the 
meeting,  and  such  agreement  shall  not  take  effect  until  a  cer- 
tified copy  thereof  is  filed  with  the  insurance  commissioner.  The 
members  of  fraternal  beneficiary  corporations  shall  not  vote  by 
proxy;  but  if  the  instrument  appointing  the  proxy  is  filed  with  the 
secretary  of  the  corporation  at  least  fifteen  days  before  the  day  fixed 
for  a  meeting  called  to  consider  the  agreements  of  transfer  aforesaid, 
they  may  so  vote  at  such  meeting. 

Section  12.  A  fraternal  beneficiary  corporation, — or  an  associa- 
tion which  limits  its  membership  to  a  particular  order,  class  or  fra- 
ternitj',  or  to  the  employees  of  towns  or  cities,  the  commonwealth,  or 
the  federal  government,  or  of  a  designated  firm,  business  house  or 


426  FRATERNAL    SOCIETY    LAW 

corporation, — or  a  secret  fraternity  or  order, — or  a  purely  cliaritable 
association  or  corporation  existing  on  the  twenty-eighth  day  of  June 
in  the  year  eighteen  hundred  and  ninety-nine  or  on  the  twenty- 
third  day  of  May  in  the  year  nineteen  hundred  and  one, — any  one 
of  which  pays  a  death  or  funeral  benefit  not  exceeding  two  hundred 
dollars,  or  disability  benefits  not  exceeding  ten  dollars  a  week,  or  an 
annuity  or  gratuity  contingent  upon  length  of  service  not  exceed- 
ing five  hundred  dollars  in  any  one  year,  or  any  or  all  of  said  bene- 
fits, and  which  is  not  conducted  as  a  business  enterprise  or  for  profit, 
may  transact  in  this  commonwealth  such  business,  without  otherwise 
conforming  to  the  provisions  of  this  chapter.  An  association  which 
limits  its  membership,  benefits  and  business  as  described  in  this  sec- 
tion may  be  incorporated  in  the  manner  prescribed  in  sections  one 
and  two  of  this  chapter,  so  far  as  the  same  are  applicable.  The 
money  or  other  benefit  to  be  paid  by  such  a  corporation  shall  be 
exempt  from  attachment  as  provided  in  section  seventeen  of  this 
chapter.  The  recording  officer  of  any  organization  claiming  ex- 
emption under  this  section  shall  file  a  certified  copj'  of  its  by-laws 
with  the  insurance  commissioner  whenever  he  shall  so  require  in 
writing. 

Section  13.  A  fi'aternal  ])eneficiary  corporation  organized  under 
the  laws  of  another  State  of  the  United  States  or  of  the  Dominion  of 
Canada  or  a  province  thereof  and  paying  only  disability  and  death 
benefits  may  be'  admitted  to  do  the  business  defined  in  this  chapter 
if  it  files  with  the  insurance  commissioner  a  duly  certified  copy  of 
its  charter  and  agxeement  of  association,  and  a  copj'  of  its  con- 
stitution and  by-laws  certified  to  by  its  secretary  or  corresponding 
officer,  with  the  appointment  of  such  commissioner  as  the  person 
upon  whom  process  shall  be  served  as  provided  in  section  four  of 
chapter  one  hundred  and  twenty-six,  and  a  statement  under  oath 
of  the  president  and  secretary  in  the  form  required  by  such  com- 
missioner of  its  business  for  the  preceding  year,  if  such  corporation 
shall  be  shown  to  be  authorized  or  permitted  to  do  business  in  the 
State,  dominion  or  province  in  which  it  is  incorporated  or  organized, 
and  if  similar  cor])orations  organized  under  the  laws  of  this  common- 
wealth are  authorized  to  do  business  in  such  State,  dominion  or 
province.  Xo  such  corporation  which  was  not  doing  business  in  this 


THE   STATE    OF   MASSACHUSETTS  427 

commornvpiilth  on  the  twciily-tliird  diiy  of  .M;iy  in  tlic  yciir  nineteen 
liuiidred  and  one  shall  hei-eafter  he  admitted  to  do  sacdi  l)usiiies.s  in 
this  comiiionwealth  nnless  it  shall  have  adopted  and  have  in  force 
moi'tnary  assessment  rates  whieh  are  not  lower  than  those  then  indi- 
cated as  necessary  hy  the  "National  Fraternal  Congress  Mortality 
Tahles. "  It'  any  other  State,  the  Dominion  of  Canada  or  a  province 
thereof  shall  impose  any  obligation  in  excess  of  the  obligations  im- 
posed by  the  provisions  of  this  chapter  upon  any  such  corporation  of 
this  commonwealth,  like  obligation  shall  be  imposed  on  similar  corpo- 
rations of  such  State,  ibmiinion  or  province  doing  business  in  this 
commonwealth.  The  tran.saction  of  the  business  defined  in  this  chap- 
ter by  any  corporation,  association,  partnership  or  individuals,  unless 
organized,  continuing  or  admitted  as  provided  herein,  is  forbidden. 
A  c(U-poration  heretofore  atlmitted  to  do  business  in  this  common- 
wealth under  the  corresponding  provisions  of  earlier  laws  may  con- 
tinue such  business  without  being  re-admitted.  Imt  sh:dl  otherwise  be 
subject  to  the  provisions  of  this  chapter. 

Section  14.  A  corporation  doing  business  under  the  foregoing 
provisions  shall  annually,  on  or  before  the  first  day  of  February, 
report  to  the  insurance  commissioner  the  location  of  its  principal 
office  in  this  commonwealth,  and  the  names  and  addresses  of  its 
president,  secretary  and  treasurer,  or  other  officers  corresponding 
thereto ;  and  shall  make  under  oath  such  statements  of  its  member- 
shi])  and  financial  transactions  for  the  year  ending  on  the  preceding 
thirty-first  day  of  December,  as  the  commissioner  may  require  to 
show  its  business  and  standing;  and  at  all  times  shall  make  under 
oath  all  statements  relative  to  said  corporation  required  by  said 
commissioner.  For  cause  the  conunissioner  nuiy  extend  the  time 
within  which  an  annual  statement  may  be  filed,  to  a  date  not  later 
than  the  first  day  of  Llarch.  Such  statement  shall  be  subscribed 
and  sworn  to  bj'  the  president  and  secretary  of  the  corporation,  or 
officers  corresponding  thereto.  For  wilfully  making  a  false  state- 
ment, if  the  statement,  whether  annual  or  otherwise,  is  required  by 
law,  the  corporation  and  the  persons  making  oath  to  or  subscribing 
the  statement  shall  severally  be  punished  by  a  fine  of  not  less  than 
one  htuidred  nor  more  than  five  hundred  dollars. 

Section  15.     The  insurance  commissioner  shall,  ujion  request  of  a 


428  FRATERNAL    SOCIETY    LAW 

domestic  corporation  doing  business  on  the  lodge  system,  personally 
or  by  some  person  designated  by  him  visit  such  cocporation  and 
thoroughly  inspect  and  examine  its  affairs,  especially  as  to  its  finan- 
cial condition.  "When  he  determines  it  to  be  prudent  for  the  protec- 
tion of  the  certificate  holders  in  the  commonwealth,  he  may  in  like 
manner  visit  and  examine,  or  cause  to  be  visited  and  examined 
by  some  competent  person  or  persons  whom  he  may  appoint  for  the 
purpose,  any  foreign  fraternal  beneficiary  corporation  applying  for 
admission  or  already  admitted  to  do  business  in  this  commonwealth, 
and  such  foreign  corj)oratiou  shall  pay  the  expense  of  such  examina- 
tion. For  the  purposes  aforesaid,  the  commissioner  or  person  making 
the  examination  shall  have  free  access  to  all  the  books  and  papers 
that  relate  to  the  business  of  such  corporation,  and  to  the  books  and 
papers  kept  by  any  of  its  organizers,  and  may  summon  and  admin- 
ister the  oath  to  and  examine  as  witness  the  directors,  officers, 
agents,  organizers  and  trustees  of  any  such  corporation,  and  any 
other  persons,  relative  to  its  financial  affairs,  transactions  and  condi- 
tions. He  may  in  his  discretion  accept,  in  lieu  of  such  examination, 
the  examination  of  the  insurance  depai'tment  of  the  State,  the 
Dominion  of  Canada  or  a  province  thereof  in  which  such  foreign 
corporation  is  organized. 

Section  16'.  No  corporation  organized  or  transacting  business 
under  the  provisions  of  this  chapter  shall  employ  paid  agents  in 
soliciting  or  jirocuring  business;  but  corporations  which  transact 
business  as  fraternal  societies  on  the  lodge  system  may  employ  organ- 
izers in  the  preliminary  organization  of  local  branches,  and  members, 
as  officers  or  deputies,  to  assist  members  of  weak  and  inactive  local 
branches  to  increase  their  membership,  if  their  compensation  does 
not  depend  upon  and  is  not  affected  by  such  increase,  and  corpo- 
rations which  limit  their  certificate  holders  to  a  particular  order  or 
fraternity  may  employ  and  pay  members  for  securing  new  members, 
and  any  corporation  may  pay  local  collectors.  Whoever  solicits 
membership  for,  or  in  any  manner  assists  in  procuring  membership 
in.  or  aids  in  the  transaction  of  business  for,  a  corporation  or  organ- 
ization not  aiilliiiri/,('(l  to  do  Inisiness  in  this  commomvealth,  siuill 
be  punished  as  i)r((vided  in  section  twenty-one  of  this  chapter.  A 
eorixn-aliou  organized  or  transacting  business  under  or  as  defined 


THE    STATE    OF    MASSACHUSETTS  429 

ill  this  chapter  shall,  within  two  months  after  the  adoption  by  it 
of  an  amendment  to  its  by-laws,  file  with  the  insurance  commis- 
sioner a  copy  tliereof,  settiiiK  forth  such  ameiidiiieiit  distinctly  and 
clcai-ly,  1111(1  this  cdpy  sluill  he  certified  by  its  rccordiiiy-  officer. 

Section  17.  Tlie  money  or  other  benefit  to  be  puid  by  a  corpora- 
tion authorized  to  do  business  under  the  provisions  of  this  chajiter 
shall  not  be  liable  to  attachment  by  trustee  or  other  jirocess,  or  be 
seized,  talvcii  apiii'(ipi'i;ited  or  ap])lied  by  any  legal  or  iMjiiitable 
pi'ocess,  or  by  operiitioii  of  biw,  to  jiay  a  debt  or  liability  of  a  cer- 
tificate holder,  or  a  beneficiary  named  therein. 

Section  18.  A  solicitor,  agent  or  examining  jjliysiciaii  wlm  sliall 
knowingly  or  wilfully  make  any  false  or  fraudulent  stiiteniciit  or 
representation  in  or  with  reference  to  any  application  for  meiiil)er- 
ship,  or  who  shall  make  any  false  or  fraudulent  statement  or  repre- 
sentation for  the  purpose  of  obtaining  any  money  from  or  benefit 
in  any  corporation  transacting  business  under  the  provisions  of  this 
chapter,  shall  be  punished  by  a  fine  of  not  less  than  one  hundred  nor 
more  than  five  hundred  dollars  or  by  imprisonment  for  not  less  than 
thirty  days  nor  more  than  one  .year,  or  by  both  such  fine  and  im- 
prisonment. A  person  wilfully  making  a  false  statement  of  any 
material  fact  or  thing  in  a  sworn  statement  as  to  the  death  or  dis- 
ability of  a  certificate  holder  in  any  such  corporation,  for  the  pur- 
pose of  procuring  payment  of  a  benefit  named  in  the  certificate  of 
such  holder,  shall  be  guilty  of  perjury. 

Section  19.  If  the  insurance  commissioner  on  investigation  is 
satisfied  that  a  corporation  organized  or  conducting  business  under 
the  provisions  of  this  chapter  has  exceeded  its  powers,  or  has  failed 
to  comply  with  any  provisions  of  law,  or  has  conducted  business 
fraudulently,  or  that  its  condition  is  such  as  to  render  its  further 
proceedings  hazardous  to  the  public  or  to  its  certificate  holders,  or 
if  such  corporation  shall  vote  to  discontinue  its  business,  he  shall 
report  the  facts  to  the  attorne.y  general,  who  ma.v  thereupon  apply 
to  the  supreme  judicial  court  or  the  superior  court,  which  shall  have 
jurisdiction  in  equity  of  such  application  for  an  injunction  restrain- 
ing such  corporation  in  whole  or  in  part  from  the  further  prosecu- 
tion of  business.  Before  making  such  report  to  the  attorney  general 
the  insurance  commissioner,  if  he  is  satisfied  that  the  corporation 


430  "    FRATERNAL    SOCIETY    LAW 

has  exceeded  its  powers,  or  has  failed  to  comply  with  any  provision 
of  law,  or  has  conducted  its  business  fraudulently,  shall  notify  such 
corporation  of  particulars  in  which  he  decides  that  it  has  exceeded 
its  powers,  or  of  the  provisions  of  law  with  which  it  has  failed  to 
comply,  or  of  the  fraudulent  matter  in  the  conduct  of  its  business, 
and  shall  give  such  corporation  a  reasonable  opportunity  to  comply 
with  the  law  or  amend  its  methods.  The  application  shall  state  the 
specific  facts  relied  upon  as  in  excess,  power,  or  as  neglect  or 
violation  of  law,  or  as  constituting-  fraudulent  conduct  of  business. 
The  court  may  issue  such  injunction  forthwith  or,  upon  notice  and 
hearing  thereon,  may  issue  an  injunction  or  decree  for  the  removal 
of  au.y  officer  of  said  corporation,  and  may  substitute  a  suitable  per- 
son to  serve  in  his  stead  until  a  successor  is  chosen,  and  may  make 
such  further  orders  and  decrees  as  the  interests  of  the  corporation, 
the  certificate  holders  and  the  public  may  require;  and  may,  after  a 
full  hearing,  appoint  a  permanent  receiver  to  take  possession  of  the 
property  and  effects  of  the  corporation,  and  to  settle  its  affairs,  sub- 
ject to  such  rules  and  orders  as  the  court  may  from  time  to  time 
prescribe.  No  such  injunction  shall  issue,  and  no  order,  judgment 
or  decree  appointing  a  temporary  or  permanent  receiver  shall  be 
made  or  granted,  otherwise  than  upon  the  application  of  the  attorney 
general,  on  his  own  motion,  or  at  the  relation  of  the  insurance  com- 
missioner, whether  the  commonwealth  or  a  member,  or  other  party 
seeks  relief. 

Section  20.  A  domestic  fraternal  beneficiaiy  corporation  may, 
with  the  approval  of  the  insurance  commissioner,  change  the  pur- 
poses for  which  it  was  organized  so  as  to  permit  it  to  transact  any 
business  authorized  by  this  chapter.  Upon  such  approval  the  pre- 
siding, financial  and  recording  officers,  and  a  nutjority  of  its  other 
officers  having  the  powers  of  directors,  shall  file  in  the  office  of  the 
secretary  of  the  commonwealth  a  certificate,  with  the  approval  of 
the  insurance  commissioner  indorsed  thereon,  setting  forth  the 
change  in  the  jiurposes  of  the  corporation.  The  secretary  of  the 
commonwealth  shall,  upon  receipt  thereof  and  upon  the  payment  of 
five  dollars,  cause  such  certificate  to  be  filed  and  recorded  in  his 
office.  Such  action  shall  operate  to  reincorporate  the  corporation 
hereunder,  but  reincorporation  shall  not  be  required.    Every  domes- 


THE   STATE    OF   MASSACHUSETTS  431 

tic  fraternal  beneficiary  corporation  may  continue  to  exercise  all 
the  rights,  powers  and  privileges  conferred  by  the  provisions  of  this 
chapter  or  of  its  certificate  of  incorporation  or  charter  not  incon- 
sistent herewith,  and  shall  be  subject  to  the  i)rovisions  of  this 
chapter,  as  if  reincorporated  hereunder.  No  certificate  of  incor- 
poration granted  under  the  provisions  of  this  chapter  shall  continue 
valid  after  one  year  from  the  date  of  such  certificate,  unless  the 
organization  has  been  completed  and  business  begun  thereiuider. 
The  certificate  of  incorporation  or  the  charter  of  any  corporation 
subject  to  the  provisions  of  this  chapter,  and  any  certificate  here- 
after granted  under  the  provisions  of  this  chapter,  shall  become  in- 
valid if  during  a  period  of  twelve  months  no  business  is  transacted 
thereunder. 

Section  21.  A  corporation,  association  or  society  transacting 
business  in  this  commonwealth  and  an  agent  or  officer  thereof  neg- 
lecting to  comply  with  or  violating  any  provision  of  this  chapter 
shall  be  punished  by  a  fine  of  not  less  than  fifty  nor  more  than  two 
hundred  dollars  or  by  imprisonment  for  not  less  than  three  months 
nor  more  than  two  years,  or  by  both  such  fine  and  imprisonment. 

Section  22.  The  provisions  of  chapter  one  hundred  and  eighteen, 
except  section  ninety-five,  shall  not  apply  to  corporations 
organized  or  admitted  under  and  transacting  business  author- 
ized by  the  provisions  of  this  chapter;  and  corporations  or  associa- 
tions heretofore  exempted  by  special  laws  from  the  provisions  of 
chapter  four  hundred  and  forty-two  of  the  acts  of  the  year  eighteen 
hundred  and  ninety-nine  shall  not  be  subject  to  the  provisions  of 
this  chapter. 

Certain  Fraternal  Beneficiary  Corporations  May  Become  Assessment 
Companies. 

Section  1.  Any  domestic  corporation  now  doing  business  under 
the  provisions  of  chapter  one  hundred  and  nineteen  of  the  Re- 
vised Laws  and  acts  amendatory  thereof,  whether  originally  incorpo- 
rated under  such  act  or  not,  which  limits  its  certificate  holders  to  a 
particular  order  or  fraternity,  may  at  any  time  within  seven  years 
after  the  date  of  the  approval  of  this  act,  at  a  meeting  called  for  the 
purpose,  adopt  its  provisions,  and  may  thereafter  carry  on  the  busi- 


432  FRATERNAL    SOCIETY    LAW 

ness  defined  in  section  one  of  chapter  one  hundred  and  twenty  of 
the  Revised  Laws,  and  may.  in  addition  thereto,  provide  for  the 
payment  of  funeral  benefits,  not  exceeding  one  hundred  dollars,  in 
case  of  the  death  of  the  assured  by  sickness,  and  shall  thereafter 
conduct  such  business  under  the  provisions  of  said  chapter  one  hun- 
dred and  twenty,  as  modified  by  this  act,  and  shall  be  deemed  an 
assessment  insurance  company. 

Section  2.  Such  vote  and  adoption  shall  not  in  any  way  affect 
the  existing  business  of  such  adopting  company,  nor  prevent  its 
continuance,  nor  annul  or  cancel  the  membership  of  such  company, 
nor  annul,  cancel,  modify  or  affect  in  any  way  its  policies  or  cer- 
tificates of  insurance,  but  all  certificates  in  force  and  outstanding 
when  the  provisions  of  this  act  are  adopted  by  anj'  such  company 
shall  continue  in  full  force  and  effect  in  all  their  provisions,  agree- 
ments and  undertakings  as  the  contracts,  policies  and  certificates  of 
such  adopting  company.  Such  policies  or  certificates  shall  be  con- 
strued according  to  the  provisions  of  law  under  which  they  were 
issued,  and  any  defenses  or  evidence  relative  to  such  policies  open 
under  such  provisions  shall  continue  a  defense  and  shall  be  received 
as  evidence  in  any  controversy  between  the  parties  to  or  interested 
in  said  policies  or  certificates. 

Section  3.  If  a  benefit  certificate  has  been  lawfully  issued  and 
the  beneficiary  named  therein  shall  have  died,  the  member  with  the 
consent  of  the  officers  of  the  company,  and  under  such  rules  as  they 
may  prescribe,  may  have  any  other  person  having  an  insurable  inter- 
est and  permitted  by  the  by-laws,  substituted  as  beneficiary  therein. 
Said  company  may  by  by-law  provide  that  should  a  member  become 
entitled  to  a  benefit  before  he  shall  have  i)aid  a  benefit  assessment 
the  company  may,  as  a  condition  precedent  to  the  payment  of  the 
benefit,  require  such  member  to  pay  the  amount  of  one  such  assess- 
ment. Standing  committees  or  boards  having  prescribed  duties 
under  the  by-laws,  including  those  the  members  of  which  are  by  such 
by-laws  made  directors  or  other  officers  corresponding  thereto,  may 
be  constituted  by  the  election  of  one  or  more  members  thereof  an- 
nually, to  serve  for  not  more  than  three  years  under  any  one  elec- 
tion. No  person  shall  be  elected  or  appointed  to  an  administrative 
position  for  more  than  three  years  at  any  one  election  or  appoint- 
ment. 


THE    STATE    OF   MASSACHUSETTS  433 

Section  4.  Any  company  adopting  the  provisions  of  this  net  sIkiII 
file  in  the  office  of  the  secretary  of  the  commonwealth  a  copy  of  the 
vote  of  adoption,  certified  by  its  clerk  or  recording  officer,  within 
thirty  days  rifter  the  final  adjournment  of  tlic  meeting  at  which  the 
vote  was  passed,  antl  thereafter  sucli  i-oinpjiny  sliiill  he  subject  to 
the  provisions  of  chapter  one  hundred  and  twenty  and  its  amend- 
ments, except  as  otherwise  provided  in  this  act. 

Section  5.  No  amendments  hereafter  made  to  any  fraternal  or 
assessment  act  shall  apply  to  corporations  or  associations  doing  busi- 
ness under  the  provisions  of  this  act.  unless  such  amendments  are 
specifically  made  applicable  thereto.     Approved  March  14,  1904. 

Benefit  to  Member  on  Death  of  Wife. 

Section  1.  In  the  event  of  the  death  of  the  wife  of  a  member  of 
anj'  such  fraternal  organization  as  is  designated  in  section  twelve 
of  chapter  one  hundred  and  nineteen  of  the  Revised  Laws,  a  portion 
of  the  amount  payable  at  the  death  of  such  member  may  be  paid 
to  him:  provided,  that  the  amount  so  paid  shall  be  deducted  from 
the  amount  payable  at  the  member's  death,  and  that  the  total 
amount  so  paid  either  at  the  death  of  the  member  or  of  the  member's 
wife  shall  not  exceed  the  amount  allowed  by  said  section  twelve  to 
be  paid  at  the  death  of  a  member. 

Section  2.  This  act  shall  take  effect  upon  its  passage.  Approved 
April  29,  1904. 

Its  Name  May  Exclude  a  Foreign  Fraternal. 

No  fraternal  beneficiary  corporation  .shall  be  admitted  to  do  busi- 
ness in  this  commonwealth  under  a  name  in  use  by  a  corporation 
organized  under  the  laws  of  this  State,  or  under  a  name  so  similar 
thereto  as  to  be  liable  to  be  mistaken  for  it,  except  with  the  con- 
sent in  writing  of  such  corporation.  The  supreme  ji;dicial  court  and 
the  superior  court  shall  have  jurisdiction  in  eqtxity  to  enforce  the 
provisions  of  this  act.    Approved  April  20,  1905. 

The  following  sections  of  the  Corporation  Law  of  the  Common- 
wealth seem  to  be  proper  to  be  here  inserted : 

Section  15.  The  agreement  of  association  .shall  state  tliat  the  sub- 
28 


434  FRATERNAL    SOCIETY    LAW 

scribers  thereto  associate  themselves  with  the  intention  of  forming 
a  coi'poration.  the  corporate  name  assumed,  the  purpose  for  which 
it  is  formed,  the  cit.y  or  town,  which  shall  be  in  this  commonwealth, 
in  which  it  is  established  or  located,  the  amount  of  its  capital  stock 
and  the  par  value  and  number  of  its  shares. 

Section  16.  Any  name  may,  subject  to  the  provisions  of  section 
eight  of  chapter  one  hundred  and  nine,  be  assumed  by  a  corporation. 
If  organized  for  the  i^urposes  mentioned  in  sections  seven  or  eight, 
or  imder  the  i^rovisions  of  chapter  one  hundred  and  fourteen  or 
section  thirty  of  chapter  one  hundred  and  eighteen,  or  if  subject  to 
any  of  the  provisions  of  chapter  one  hundred  and  sixteen,  the  words 
"co-operative"  or  "fishing"  or  "co-operative  bank"  or  "insurance," 
or  "mutual  insurance"  if  organized  upon  the  mutual  principle,  or 
"trust  company,"  respectively,  shall  form  part  of  the  name. 

Section  17.  The  first  meeting  shall  be  called  by  a  notice  signed 
by  one  or  more  of  the  subscribers  to  such  agreement,  stating  the 
time,  place  and  purpose  of  the  meeting,  a  copy  of  which  notice 
shall,  seven  da.ys  at  least  before  the  day  appointed  for  the  meeting, 
be  given  to  each  subscriber,  or  left  at  his  usual  place  of  busiues.s  or 
residence,  or  deposited  in  the  post  ofSce,  postpaid,  and  addressed  to 
him  at  his  usual  place  of  business  or  residence.  Whoever  gives  such 
notice  shall  make  affidavit  of  his  doings,  which,  with  a  copy  of  the 
notice,  shall  be  recorded  in  the  records  of  the  corporation. 

Section  18.  The  subscribers  to  the  agreement  of  association  shall 
hold  the  franchise  until  the  organization  has  been  completed;  and, 
unless  it  is  otherwise  pi-ovided  in  such  agreement,  each  subscriber 
who  elects  to  take  such  shares  at  the  first  meeting  may  take  such 
proportion  of  the  shares  of  the  capital  stock  as  the  number  of  sub- 
scribers to  the  agreement  bears  to  the  whole  number  of  shares,  or 
any  part  of  such  proportion,  upon  paying  tlie  assessments  thereoD 
as  called  for  by  the  corporation.  All  shares  not  so  taken  shall  be 
disposed  of  as  the  corjioration  determines. 

Section  19.  At  such  first  meeting,  inchiding  any  necessary  or 
reasonable  adjournment,  an  organization  shall  be  effected  by  the 
choice  by  ballot  of  a  temporary  cleric,  wlio  shall  be  sworn,  and  by 
the  adoption  of  by-laws,  and  the  election,  in  the  manner  provided 
in  section  twentv-three,  of  directors,  treasurer,  clerk  and  such  other 


THE    STATE    OF   MASSACHUSETTS  435 

ofiScers  as  the  by-laws  may  pi'ovide ;  but  at  such  first  meeting  no 
person  shall  be  eligible  as  a  director  who  has  not  subscribed  the 
agreement  of  association.  The  temporary  clerk  shall  make  and  at- 
test a  record  of  the  proceedings  until  the  clerk  has  been  chosen  and 
sworn,  including  a  record  of  such  choice  and  qualification. 

Section  20.  The  president,  treasurer  and  a  majority  of  the  direc- 
tors, shall  forthwith  make,  sign  and  swear  to  a  certificate  setting 
forth  a  true  copy  of  the  agreement  of  association  with  the  names 
of  the  subscribers  thereto,  the  date  of  the  first  meeting  and  the 
successive  adjournments  thereof,  if  any,  and  shall  submit  such  cer- 
tificate and  also  the  records  of  the  corporation  to  the  commissioner 
of  corporations,  who  shall  examine  the  same,  and  who  may  require 
such  other  evidence  as  he  may  judge  necessary.  If  it  appears  that 
the  requirements  of  the  preceding  sections  preliminary  to  the  estab- 
lishment of  the  corporation  have  been  complied  with,  the  commis- 
sioner shall  so  certify  and  approve  the  certificate  by  his  indorse- 
ment thereon.  Such  certificate  shall  thereupon  be  filed  by  said 
officers  in  the  office  of  the  secretary  of  the  commonwealth,  who,  upon 
payment  of  the  fee  hereinafter  provided,  shall  cause  the  same  with 
the  indorsement  thereon  to  be  recorded,  and  shall  thereupon  issue 
a  certificate  in  the  following  form: 

COMMONWEALTH  OP  MASSACHUSETTS. 

Be  it  known  that  whereas  (the  name  of  the  subscribers  to  the 
agreement  of  association)  have  associated  themselves  with  the  in- 
tention of  forming  a  corporation  under  the  name  of  (the  name  of 
the  corporation),  for  the  purpose  (the  purpose  declared  in  the  agree- 
ment of  association),  with  a  capital  of  (the  amount  of  capital  fixed 
in  the  agreement  of  association),  and  have  complied  with  the  pro- 
visions of  the  statutes  of  this  commonwealth  in  such  case  made  and 
provided,  as  appears  from  the  certificate  of  the  president,  treasurer 
and  directors  of  said  corporation,  duly  approved  by  the  commis- 
sioner of  corporations  and  recorded  in  this  office :  now,  therefore,  I 
(the  name  of  the  secretary),  secretary  of  the  commonwealth  of 
Massachusetts,  do  hereby  certify  that  said  (the  names  of  the  sub- 
scribers to  the  agreement  of  association),  their  associates  and  suc- 
cessors, are  legally  organized  and  established  as,  and  are  hereby 


436  FRATERNAL    SOCIETY    LAW 

made,  an  existing  corporation  under  the  name  of  (name  of  the  cor- 
poration), with  the  powers,  rights  and  privileges,  and  subject  to 
the  limitations,  duties  and  restrictions,  which  by  law  appertain 
thereto. 

Witness  mj^  official  .signature  hereunto  subscribed,  and  the  seal  of 
the  commonwealth  of  Massachusetts  hereunto  affixed,  this 
day  of  in  the  year  (the  date  of  execution  of  the 

certificate). 

The  secretary  shall  sign  the  same  and  cause  the  seal  of  the  com- 
monwealth to  be  thereto  affixed,  and  such  certificate  shall  have  the 
force  and  eft'ect  of  a  special  charter  and  shall  be  conclusive  evidence 
of  the  existence  of  such  corporation.  He  shall  also  cause  a  record 
of  such  certificate  to  be  made,  and  a  certified  copy  of  such  record 
may  be  given  in  evidence  with  like  efl'ect  as  the  original  certificate. 

Section  8.  A  corporation  which  is  organized  under  the  general 
laws  may  assume  any  name  which,  in  the  judgment  of  the  commis- 
sioner, indicates  that  it  is  a  corporation  ;  but  it  shall  not  assume 
the  name  of  another  corporation  estalilished  under  the  laws  of  this 
commonwealth,  or  of  a  corporation,  firm,  association  or  person  car- 
rying on  business  in  this  commonwealth,  at  the  time  of  such  organ- 
ization or  within  -three  years  prior  thereto,  or  a,ssume  a  name  so 
similar  thereto  as  to  be  liable  to  be  mistaken  for  it,  except  with 
the  consent  in  writing  of  said  existing  corporation,  firm  or  asso- 
ciation or  of  such  person  previously  filed  with  the  commissioner  of 
corporations.  The  supreme  judicial  court  or  the  superior  court  shall 
have  jurisdiction  in  equitJ^  upon  the  application  of  any  person  inter- 
ested or  affected,  to  enjoin  such  corporation  from  doing  business 
under  a  name  assumed  in  violation  of  the  provisions  of  this  section, 
although  its  certificate  of  organization  may  have  been  approved  and 
a  certificate  of  incorporjitioii  may  liavi'  been  issued  to  it. 

Section  9.  "EJpon  the  application  of  any  corporation,  authorized 
by  a  vote,  of  two-thirds  of  the  .stockholders  present  aiid  voting  at 
a  meeting  called  for  the  purpose,  the  commissioner  of  corporations 
may,  after  public  notice  of  sucli  application,  authorize  such  corpora- 
tion to  change  its  name.  If  it  has  no  capital  stock,  the  ajjplieation 
maj'  be  authorized  by  a  two-thirds  vote  of  the  jiersons  legally  quali- 
fied to  vote  in  meetings  of  the  corporation  present  and  voting  on 


THE    STATE    OF    MASSACHUSETTS  437 

the  (juestion  of  the  change  of  name.  The  approval  of  tlic  insurance 
commissioner  shall  be  required  fpr  applications  l)y  corp(jrations 
which  are  subject  to  the  provisions  of  chaj)ters  one  hundred  and 
eighteen,  one  hundred  and  iiin('teen  and  one  hundred  and  twenty. 

Section  10.  A  certified  copy  of  such  authorization  and  a  certifi- 
cate of  the  vote  of  the  corporation,  signed  and  sworn  to  by  the 
president,  treasurer  and  a  majority  of  the  directors,  or  if  it  lias  no 
such  officers,  b.y  its  presiding  and  financial  officers  and  a  majority 
of  its  other  officers  having  the  powers  of  directors,  shall  be  filed 
in  the  office  of  the  secretary  of  the  commonwealth.  The  commissioner 
shall  require  public  notice  to  be  given  of  the  change  so  authorized; 
and  upon  receipt  of  proof  thereof  the  secretary  of  the  common- 
wealth may  grant  a  certificate  of  the  name  which  the  corporation 
shall  bear,  which,  subject  to  the  provisions  of  section  eight,  shall 
thereafter  be  its  legal  name. 

Section  11.  A  corporation  shall  have  the  same  rights,  powers 
and  ]irivileges  and  be  subject  to  the  same  duties,  obligations  and 
lial)ilities  under  its  new  name  as  before  its  name  was  changed,  and 
may  sue  and  be  sued  by  its  new  name;  but  any  action  brought 
against  it  by  its  former  name  shall  not  be  defeated  on  that  account, 
and,  on  motion  of  either  party,  the  new  name  may  be  substituted 
therefor. 

Section  95.  The  compensation  of  receivers  of  insolvent  insurance 
companies  shall  be  fixed  by  the  supreme  judicial  court.  All  accounts 
rendered  to  the  court  by  such  receivers  shall  be  referred  to  the  in- 
surance commissioner  for  his  examination  and  report  thereon. 

Such  receivers,  at  the  expiration  of  one  year  after  final  settlement 
ordered  by  the  court,  shall  report  to  the  coui-t  the  names  and  resi- 
dences, if  known,  of  the  persons  entitled  to  money  or  dividends  from 
the  estate  of  such  companies  remaining  in  their  hands  uncalled  for, 
with  tlie  amiinnt  due  to  eacli.  The  court  shall  thereupon  order  a 
notice  to  be  given  by  the  receivers  and,  upon  the  expiration  of  one 
year  after  the  time  of  giving  such  notice,  the  receivers  shall  in  like 
manner  report  the  amounts  still  uncalled  for.  Unless  cause  shall 
appear  for  decreeing  otherwise,  such  amounts  shall  then  be  ordered 
to  be  paid  into  the  treasury  of  the  commonwealth,  and  schedules 
signed  by  the  receivers  .shall  at  the  same  time  be  deposited  with 


438  FRATERNAL    SOCIETY   LAW 

the  treasurer  and  receiver  general  and  auditor,  setting  forth  the  de- 
cree of  the  court  and  the  names  and  residences,  so  far  as  known,  of 
the  persons  or  parties  entitled  thereto  alphabetically  arranged,  and 
the  amount  due  to  each.  The  auditor  shall  forthwith  cause  notice  of 
such  deposit  to  be  mailed  to  such  persons,  and,  upon  certification  by 
him  that  a  claimant  is  entitled  to  any  part  of  said  deposit,  it  shall 
be  paid  in  the  same  manner  as  other  claims  against  the  common- 
wealth. Upon  the  payment  into  the  treasury  of  the  commonwealth 
of  such  unclaimed  money  or  dividends  by  the  receiver,  and  the  al- 
lowance by  the  court  of  his  final  account,  or  at  the  expiration  of  one 
year  after  the  final  settlement  ordered  by  tlie  court  if  lie  then  has  in 
his  hands  no  unclaimed  money  or  dividends,  he  shall  deposit  with 
the  insurance  commissioner  all  books  and  papers  of  such  company, 
including  those  relative  to  his  receivership,  whicli  shall  be  pre- 
served by  the  commissioner. 

Section  6.  The  corporation  may  prescribe  by  its  by-laws  the  man- 
ner in  which,  and  the  officers  and  agents  by  whom,  the  purposes  of 
its  corporation  may  l)e  accomplished,  and,  instead  of  the  directors 
and  other  officers  to  be  chosen  at  the  first  meeting,  it  may  have  a 
board  of  other  officers  with  the  powers  of  directoi-s,  and  presiding, 
financial  and  i-ecording  officers  with  the  powers  of  president,  treas- 
urer and  clerk:  and  its  certificate  of  organization  nuiy  be  made, 
signed  and  sworn  to  b.y  its  presiding,  financial  and  recording  officers 
and  a  majority  of  its  other  officers  having  the  powers  of  directors; 
and  the  certificate  issued  by  the  secretary  under  the  provisions  of 
section  twenty  of  chapter  one  hundred  and  ten  shall  be  modified 
to  correspond  with  the  facts  in  each  case. 

Section  4.  Every  foreign  corporation,  except  foreign  insurance 
corporations,  which  has  a  usual  place  of  bu.siness  in  this  common- 
wealth, or  whicli  is  engaged  in  this  commonwealth,  permanently  or 
temporarily,  and  with  or  without  a  usual  place  of  business  therein, 
in  the  construction,  erection,  alteration  or  repair  of  a  building, 
bridge,  railro;id,  railway  or  structure  of  any  kind,  shall,  before 
doing  business  in  this  commonwealth,  in  writing  appoint  the  com- 
missioner of  corporations  and  his  successor  in  office  to  be  its  true 
and  lawful  attorney  upim  wliom  all  lawful  processes  in  any  action 
or  iiroceeding  against   il   may  l)e  served,  and  in  sucli  writing  shall 


THE   STATE    OF   MABBACHJJ SETTS  4;^,9 

agree  that  any  lawful  process  against  it  which  is  served  on  said 
attorney  shall  be  of  the  same  legal  force  and  validity  as  if  served 
on  the  corporation,  and  that  the  authority  shall  continue  in  force  so 
long  as  any  liability  remains  outstanding  against  the  corporation  in 
this  commonwealth.  Every  foreign  insurance  corporation  shall  in 
like  manner  and  with  like  effect  appoint  the  insurance  commissioner 
or  his  successor  in  office  to  be  its  attorney.  The  power  of  attorney 
and  a  copy  of  the  vote  authorizing  its  execution,  dulj'  certified  and 
authenticated,  shall  be  filed  in  the  office  of  the  commissioner  who  has 
been  appointed,  and  copies  certified  by  him  shall  be  sufficient  evi- 
dence thereof.  Service  of  such  process  shall  be  made  by  leaving  a 
copy  of  the  process  with  a  fee  of  two  dollars  in  the  hands  or  in  the 
office  of  the  commissioner,  and  such  service  shall  be  sufficient  service 
upon  the  principal. 

After-enacted  Laws — Limitations  Regarding  Bringing  Suit. 

By-laws  adopted  subsequent  to  the  issuance  of  certificate  for  the 
purpose  of  limiting  the  time  for  bringing  action  on  certificates  was 
held  not  to  affect  certificates  that  had  therebefore  been  issued. 

Attorney  General  vs.  Supreme  Council  A.  L.  of  H.,  Suisreme  Court 
of  Mass.,  June,  1907,  81  N.  E.  966. 

Compromises — Accord  and  Satisfaction. 

Payment  of  a  less  sum  in  discharge  of  a  greater  is  not  at  common 
law  an  accord  and  satisfaction,  and  this  rule  applies  to  settlements 
under  benefit  certificates. 

Attorney  General   vs.  Supreme  Council  A.  L.  of  H.,  Supreme  Court 
of  Mass.,  June.  1907,  81  N.  E.  966. 

Beneficiaries — ' '  Family. ' ' 

The  statute  under  which  the  society  was  incorporated  provided 
that  beneficiaries  should  belong  to  the  family  of  the  members.  A 
certificate  was  issued  payable  to  the  member's  children,  who  sub- 
sequently married  and  established  families  of  their  own.    Held  that 


440  FRATERNAL   SOCIETY   LAW 

in  a  contest  between  the  widow  of  the  deceased  brother  and  such 
children,  the  widow  was  entitled  to  take  the  benefit,  the  court  say- 
ing: 

"In  Tjder  vs.  Odd  Fellows,  etc.,  Ass'n,  145  Mass.  134,  13  N.  E. 
360,  it  was  said  of  the  designation  of  a  beneficiary  that  to  make  it 
available  after  his  death,  there  must  then  be  a  relation  to  the  de- 
ceased such  as  is  contemplated  by  the  agreement  of  the  association 
and  the  bj'-laws  relating  to  payment,  and  it  was  held  that  the  wife 
who  was  properly  designated  lost  her  rights  by  a  divorce  obtained 
for  her  husband's  fault.  The  same  doctrine  was'  held  under  a  simi- 
lar statute  of  Connecticut,  in  Larkin  vs.  Knights  of  Columbus, 
188  jMass.  32m,  73  N.  E.  850,  and  in  cases  cited  in  the  opinion.  We 
think  that,  under  the  statute  and  by-laws  before  us,  the  fact  that 
the  claimants  ceased  to  be  members  of  their  father's  family  ren- 
dered the  designation  of  no  effect,  and  that  the  condition  was  to  be 
treated  as  a  failure  to  designate,  which  gives  the  widow  the  right 
to  receive  the  money  under  the  by-law. 

Spear  vs.  Boston  Relief  Assn.,  Supreme  Court  of  Mass.,  May,  1907, 
81  N.  E.  196. 

Fraternal  Societies  Exempt  from  Insurance  Statutes. 

A  fraternal  society  is  held  not  to  be  subject  to  the  provisions  of 
the  laws  of  the  State  applicable  to  regular  life  insurance  companies 
requiring  that  the  application  should  be  annexed  to  the  policy  in 
order  to  enable  the  insurer  to  treat  it  as  a  part  of  the  contract  and 
prove  same  as  a  defense  to  an  action  thereon. 

Attorney  General   vs.   Colonial   Life  Association,   Supreme  Court   of 
Mass.,  March,  1907.  80  N.  E.  455.  " 

Contract — Composition  of. 

Where  a  certificate  provided  that  it  was  issued  on  the  statements 
of  the  applii-ant  niaile  in  his  application  and  those  made  by  him  to 
the  medical  e.xamiuer,  all  of  which  were  filed  in  the  office  of  the 
society,  sucli  applieatiou  and  medical  examination  so  far  as  material 


THE    STATE    OF    MASSACHUSETTS  441 

were  held  to  be  incorporated  in  the  certificate  and  to  constitute  a 
part  of  the  contract  to  the  same  extent  as  though  they  had  been 
formally  repeated  in  the  certificate. 

Attorney   General   vs.   Colonial   Life   Association,   Supreme  Court   of 
Mass.,  March,  1907,  80  N.  E.  455. 

Suicide,  Risk  not  Assumed. 

A  member  suicided  as  a  result  of  acute  melancholia.  Ills  certifi- 
cate was  issued  upon  an  application  which  contained  agreeuent 
as  follows:  "I  also  consent  and  agree  that  if  a  certificate  or  policy 
is  granted  on  this  application,  the  same  shall  not  cover  death  by 
suicide,  whether  sane  or  insane."  There  was  also  a  by-law  in  force 
in  the  society  providing  that  there  should  be  no  liability  in  the 
event  that  the  member  suicided.  It  was  held  that  the  association 
hud  not  assumed  the  risk  of  suicide. 

Attorney  General   vs.   Colonial   Life   Association,   Supreme  Court   of 
Mass.,  March,  1907,  80  N.  E.  455. 

After-enacted  Laws — Emergency  Fund. 

After  a  society  had  amended  its  by-laws  readjusting  and  increas- 
ing the  rates  of  contribution  to  be  made  by  members,  a  bill  in  equity 
was  filed  by  certain  members  to  prevent  the  carrying  into  effect  of 
such  by-laws.  The  amended  by-laws  provided  for  the  creation  and 
maintenance  of  an  emergency  fund.  As  to  the  right  of  the  society 
to  establish  the  emergency  fund,  the  court  said  : 

"Plainly  the  statute  contemplates  that  such  corporations  shall 
have  power  to  establish  bj'  their  by-laws  a  system  of  giving  death 
benefits  which  shall  be  sound  and  equitable  and  founded  upon  prin- 
ciple which  can  be  reasonably  expected  to  furnish  i)ro])er  security 
for  the  i^erformanee  of  their  contracts  with  member.  The  power 
to  make  proper  changes  in  these  particulars  bj'  amendments  of  the 
by-laws  from  time  to  time  is  expressly  given  and  there  is  no  ground 
for  the  contention  that  it  is  a  violation  of  the  statute  or  of  the 
defendant's  charter  rights  to  provide  for  such  assessments  as  will 
be  likely  to  procure  the  payments  of  the  sums  named  in  the  certifi- 


4.42  FRATERNAL    SOCIETY   LAW 

cates.  The  statute  expressly  authorizes  not  only  a  death  fund 
amounting  to  three  full  assessments  from  the  members,  but  also  the 
accumulation  of  a  reserve  fund  amounting  to  five  per  cent  upon 
the  face  value  of  all  outstanding  certificates. 

Reynolds    vs.    Supreme   Council   Royal   Arcanum,    March,    1906,   192 
Mass.  150. 

Classes— Right  of  Society  to  Separate  Membership  into  Classes. 

As  to  the  right  of  a  society  to  classify  its  members  and  to  separate 
them  into  different  classes,  the  following  language  was  employed  by 
the  court  having  this  question  under  consideration: 

"The  objection  that  the  amendments  are  illegal  by  reason  of  the 
division  of  the  members  into  classes  cannot  prevail.  There  is  no 
objection  to  the  classification  of  members  according  to  age,  and  it 
would  be  unjust  to  di.sregard  age  in  determining  the  rates  that  dif- 
ferent persons  shall  pay  for  death  benefits  in  an  association  of  this 
kind." 

Reynolds   vs.    Supreme   Council   Royal    Arcanum.    March,    1906,   192 
Mass.  150. 

Right  to  Raise  and  Readjust  Rates. 

With  respect  to  the  right  of  a  society  to  readjust  the  rates  of 
members  and  increase  same,  bringing  the  members  to  attained  age, 
the  following  is  the  true  rule : 

"In  regard  to  a  similar  provision  under  which  a  mutual  fire  in- 
surance company  changed  its  by-laws  so  as  to  increase  assessments 
upon  certain  policy  holders,  the  Supreme  Court  of  the  United  States 
uses  this  language, — 'The  liability  of  the  members  of  this  institu- 
tion is  of  a  two-fold  nature.  It  results  both  from  the  obligation  to 
conform  to  the  laws  of  their  own  making  as  members  of  the  body 
politic  and  from  a  peculiar  assumption  or  declaration  which  each 
individual  signs  on  becoming  a  member.  The  latter  is  remarkably 
comprehensive, — We  will  abide  by,  observe  and  adhere  ^to  the  con- 
stitiitioii,  rules  and  regvilations  which  are  already  established  or  may 
hereafter  be  established  by  the  majority  insured,  or  which  are  or 


THE    STATE    OF    MASSACHUSETTS  443 

may  hereafter  be  established  by  the  president  and  directors  of  the 
society.  As  to  what  is  contended  to  be  a  material  alteration  in  their 
society  we  consider  it  merely  as  a  new  arrangement  or  (listrihvitii)n 
of  their  funds,  and  whether  just  or  unjust,  reasonable  or  unreason- 
able, benevolent  or  otherwise  to  all  concerned  was  certainly  a  mere 
matter  of  speculation  proper  for  the  consideration  of  the  society 
and  which  no  individual  is  at  liberty  to  complain  of  as  he  is  bound 
to  consider  it  as  his  own  individual  act.  Every  member,  in  fact, 
stands  in  the  peculiar  situation  of  being  party  of  l)oth  sides,  insurer 
and  insured.  Certainly  the  general  submission  which  they  have 
■signed  will  cover  their  liability  to  submit  to  this  alteration." 

Reynolds   vs.    Supreme   Conncil    Royal    Arcanum.    March.    1906,    192 
Mass.  1.50. 

Right  to  Amend  the  Laws  and  Duty  of  the  Society  to  Perpetuate 
Itself. 

On  the  question  of  the  power  to  amend  the  by-laws  and  the  duty 
of  the  society  to  do  so  in  order  to  perpetuate  itself,  the  following 
language  is  apropos: 

"On  principle  and  on  the  weight  of  authority,  we  are  of  opinion 
that  there  is  nothing  in  this  contract  that  prevents  a  corporation 
from  amending  its  by-laws  in  a  reasonable  Avay  to  accomplish  the 
purposes  for  which  it  was  organized,  even  though  the  change  in- 
creases the  payments  to  be  made  by  certificate  holders,  which 
changes  necessarily  involve  some  hardship  to  certain  individual 
members,  but  the  corporation  under  the  law  should  do  that  which 
will  bring  the  greatest  good  to  the  gi^eatest  number.  The  members 
who  complain  of  its  action  are  those  who  have  had  the  benefit  of 
insurance  for  many  years  at  very  much  less  than  the  cost  of  their 
insurance  to  the  corporation.  The.v  have  had  the  good  fortune  to 
survive  and  therefore  their  contracts  have  bi-ought  them  no  money, 
but  all  the  time  they  have  had  a  stipulated  security  against  the  risk 
of  death.  If  now  they  are  called  upon  to  pa,v  for  future  insurance 
no  more  than  its  cost  to  the  corporation  the.v  ought  not  to  think  it 
unjust," 

Reynolds   vs.    Supreme   Council    Royal    Arcanum,    March,    190G,    192 
Mass.  150. 


444:  FRATERNAL    SOCIETY    LAW 

Warranty  and  Misrepresentation. 

•1 
A  misrepresentation  which  is  not  a  warranty,  unless  made  with 

actual  intent  to  deceive,  or  unless  the  matter  misrepresented  in- 
creases the  risk,  was  held  not  to  avoid  the  certificate. 

Kidder  vs.  Supreme  Commandery  United  Order  of  the  Golden  Cross, 
June,  1906,  192  Mass.  326. 

Forfeiture — Warranty. 

For  the  facts  in  a  case  where  misrepresentation  and  breach  of  war- 
ranty was  charged,  and  where  forfeiture  of  a  certificate  was  also 
claimed  on  account  of  the  failure  of  the  member  to  make  certain 
payments,  see 

Kidder  vs.  Supreme  Commandery  United  Order  of  the  Golden  Cross, 
June,  1906,  192  Mass.  326. 

Beneficiary — Dependents. 

On  the  question  of  dependency  that  must  exist  in  order  to  entitle 
a  beneficiary  named  as  dependent  to  take  the  benefit,  the  court  said : 

' '  Trivial  or  casual  or  perhaps  wholly  charitable  assistance  would 
not  create  a  relationship  of  dependency  within  the  meaning  of  the 
statute  and  by-laws.  Something  more  is  itndoubtedly  reqiured.  The 
beneficiary  must  be  dependent  upon  the  member  in  a  material  de- 
gree for  support  or  maintenance  or  assistance,  and  the  obligation  on 
the  part  of  the  member  to  furnish  it,  must  it  would  seem  rest  upon 
some  moral  or  legal  or  equitable  grounds  and  not  upon  a  purely 
V(ilmita)-y  or  charitable  impulse  and  disposition  of  the  member. 

Wilber  vs.  Supreme  Lodge  New  England  Order  of  Protection,  June, 
1906,  192  Mass.  477. 

Beneficiary — Suit  by  Executor  of  Member. 

Where  an  executor  under  the  will  of  the  deceased  member  brought 
suit  to  recover  on  a  certificate  that  the  member  held  in  the  society, 
and  which  was  payable  to  a  person  other  than  the  executor,  it  was 


THE    STATE    OF    MASSACHUSETTS  445 

held  that  the  burden  rested  on  the  executor  to  maintain  his  action 
by  showing  that  he  and  not  the  person  named  in  the  certificate  was 
entitled  to  receive  the  amount  of  sam(\  and  that  this  was  true  not- 
withstanding the  fact  that  the  society  had  merely  filed  a  general 
denial  to  the  claim  made  by  the  executor. 

Klttredge  vs.  Boston  Firemen's  Mutual  Relief  Assn.,  March,  1906, 
191  Mass.  23. 

Service  of  Summons  on  Foreign  Society. 

The  provisions  of  a  foreign  statute,  providing  for  the  service  of 
summons  upon  foreign  societies  doing  business  in  such  State  to  be 
made  upon  the  auditor  of  state  so  long  as  there  were  any  liabilities 
existing  on  the  part  of  the  society  to  citizens  of  that  State,  was 
held  to  be  good  and  binding,  and  such  rule  would  be  recognized  and 
enforced  by  the  courts  of  the  State  where  the  society  was  incor- 
porated. 

Bruning  vs.  Brotherhood  Accident  Co.,  March,  1906,  191  Mass.  115. 

Beneficiary — Change  of. 

A  change  of  beneficiary  will  not  be  permitted  to  be  made  except 
same  be  in  compliance  with  the  provisions  of  the  laws  of  the  society. 

Abbott  vs.  Supreme  Colony  United  Order  of  Pilgrim  Fathers.  January, 
1906,  190  Mass.  67. 

Agency — Local  Officers  Cannot  Waive  Laws. 

Subordinate  lodges  and  the  officers  thereof  are  without  power  to 
waive  the  requirements  of  the  constitution  and  laws  of  the  society 
in  respect  to  making  changes  of  beneficiaries. 

Abbott  vs.  Supreme  Colony  United  Order  of  Pilgrim  Fathers,^  January, 
1906,  190  Mass.  67. 

Accident  Insurance. 

For  the  facts  in  a  case  arising  under  an  accident  insurance  con- 
tract issued  by  a  fraternal  society  see  the  following: 


446  FRATERNAL    SOCIETY    LAW 


Noyes  vs.  Commercial   Travelers'  Eastern  Accident  Assn.,  January, 

1906,  190  Mass.  171;  and  also 
Morse  vs.  Fraternal  Accident  Assn..  February.  1906,  190  Mass.  417. 

Assessment — Duty  to  Levy  Same. 

Where  it  is  the  dutj'  of  a  society  to  levy  assessments  upon  mem- 
bers for  a  sufficient  amount  to  enable  it  to  pay  its  losses  and  it  fails 
-to  levy  such  assessments,  beneficiaries  entitled  to  collect  for  losses 
sustained  may  have  an  action  for  breach  of  warranty  against  the 
society. 

Garcelon  vs.  Commercial  Travelers,  June.  1903,  184  Mass.  8. 

Forfeiture — No  Recovery  of  Payments  Made. 

Upon  the  death  of  a  member  who  had  been  .suspended  for  failure 
to  pay  dues  and  assessments  who  had  not  been  reinstated  at  the 
time  of  his  death,  his  administrator  was  not  entitled  to  recover 
from  the  society  the  sums  that  had  been  paid  by  the  member  prior 
to  his  suspension. 

McLaughlin  vs.  Supreme  Council  Catholic  Knights  of  America,  Octo- 
ber, 1903,  184  Mass.  298. 

Forfeiture — Requirements  for  Reinstatement. 

AVhere  the  laws  of  a  society  prescribed  that  in  order  for  a  sus- 
pended member  to  be  reinstated  he  should  be  examined  and  his 
examination  approved  by  Uic  nu'dieal  e.xaniimn-  in  chief,  he  had 
not  complied  with  these  laws  b.v  being  examined  and  receiving  the 
approval  of  the  local  examiner  who  turned  the  medical  examination 
certificate  over  to  the  member  and  he  in  turn  turned  it  over  to  the 
subordinate  lodge,  which  certificate  never  reached  the  Supreme  Med- 
ical Examiner  until  after  the  member's  deatli.  and  was  not  acted 
upon  by  him. 

McLaughlin  vs.  Supreme  Council  Catholic  Knights  of  .'\merica,  Octo- 
ber. 1903.  184  Mass.  298. 


THE    STATE    OF    MASiiACHUSETTS  447 

After-enacted  Laws — Breach  of  Contract. 

A  meiiibcr  held  a  $."). 0(1(1  (•(■rtiHcjitc  upon  which  he  lia<l  hceii  mak- 
ing payiiiciits.  A  subsequent  by-law  was  passed  providing  that  the 
societ.v  would  not  pay  more  than  $"J,00()  on  any  certificate.  The 
sociely  then  assessetl  the  nieinher  n|Miii  a  .+:2. (111(1  cerl  ideate,  instead 
of  a  $5,000  certificate.  The  member,  complaining  and  protesting, 
paid  upon  the  $2,000  certificate  and  tendered  the  amount  which  he 
had  been  paying  upon  the  $5,000  certificate,  which  was  refused. 
He  then  claimed  that  the  contract  had  been  broken  and  brought  suit, 
asking  for  damages  in  the  amount  of  the  certificate.    The  court  said : 

"We  are  of  opinion  that  the  contract  has  not  yet  been  brolien. 
If  is  a  contract  to  pay  at  his  death  $5,000  to  his  beneficiary.  If  the 
defendant  does  not  choose  to  assess  him  upon  a  $5,000  certificate, 
he  has  no  ground  for  complaining.  He  stands  ready  to  be  assessed, 
and  can  do  no  more. 

Porter  vs.  Supreme  Covmcil  American  Legion  of  Honor,  May,  1903, 
183  Mass.  326. 

After-enacted  Laws  Cannot  Cut  Down  Certificate  Arbitrarily. 

A  society  attempted  to  cut  its  certificates  outstanding  from  $5,000 
to  $2,000  by  tlu^  passage  of  a  by-law.  The  members  of  the  society 
had  promised  in  their  application  to  make  full  compliance  with  all 
laws  then  in  force  and  those  thereafter  adopted.  The  Court  held 
that  the  society  could  not  reduce  the  amount  of  the  benefits  promised 
to  be  paid,  and  that  the  provision  in  the  contract  made  by  the 
member  providing  for  full  compliance  with  all  the  laws  in  force 
then  existing  or  thereafter  adopted  referred  to  laws  that  might  re- 
quire the  payment  of  assessments,  etc.,  and  that,  subject  to  these 
conditions,  the  promise  to  ]iay  was  absolute. 

Newhall   vs.    Supreme   Council   American   Legion   of   Honor,   March, 
1902,  181  Mass.  111. 

After-enacted  Laws — New  Classes. 

With  respect  to  the  right  of  a  society  to  amend  its  by-laws  and 


448  FRATERNAL    SOCIETY    LAW 

increase  the  rates  of  contribution  of  members  and  classify  the 
members  into  different  plans,  etc.,  the  following  language  was  em- 
ployed by  the  Court  having  these  questions  under  consideration : 

"This  change  in  the  by-laws  is  not  void  as  opposed  to  the  power 
to  make  changes  on  the  ground  that  it  is  calculated  to  defeat  the 
purpose  of  the  organization  and  destroy  the  rights  of  the  members, 
it  may  be  conceded  that  some  amendments  might  be  so  foreign  to 
the  general  scheme  and  purpose  of  the  organization  and  so  contrary 
to  its  fundamental  law  and  the  contracts  made  under  it  as  not  to 
be  within  the  power  of  amendment  referred  to,  but  this  is  not  true 
of  an  amendment  which  merely  changes  the  forms  and  methods 
while  substantially  all  the  general  plan  and  purpose  of  the  organiza- 
tion is  preserved.  We  are  of  opinion  therefoi'e  that  the  classified 
assessments  referred  to  in  the  bill  are  not  shown  to  be  unauthorized 
and  illegal." 

Messer  vs.  Grand  Lodge  A.  0.  U.  W.,  January,  1902,  180  Mass.  321. 

Beneficiaries — ' '  Children. ' ' 

In  construing  the  statute  designation  the  class  of  persons  that  may 
be  named  as  beneficiary  and  the  word  children  as  used  therein, 
the  Court  held  that  legitimate  children  alone  were  meant  by  the 
term  children,  and  that  an  illegitimate  child  was  not  entitled  to  be 
named  as  the  beneficiary. 

Lavigne  vs.  Ligue  des  Patriotes,  February,  1901.  ITS  Mass.  25. 

Conditions  Precedent  to  Liability. 

A  provision  in  the  laws  of  a  society  requiring  sworn  certificate 
from  the  physician  l)efore  benefits  can  be  received  by  a  member 
was  held  to  he  a  condition  precedent  to  the  society's  liability. 

Audette  vs.  L'Union  St.  Joseph,  March,  1901,  178  Mass.  113. 

Beneficiaries,  Failure  of. 

Where  a  membei'  died  without  leaving  any  p(>rsoiis  authoriz(>d  by 


THE    STATE    OF    MICHIGAN  449 

law  to  be  designated  as  l)eiiefieiary,  and  the  society  waived  the 
claim  of  reversion  of  the  fund,  the  executor  of  the  deceased  mem- 
ber's estate  was  held  to  be  entitled  to  be  admitted  as  a  party  to  a 
suit  on  the  certificate  in  order  to  enable  him  to  raise  the 'question 
whether  there  was  a  resulting  trust  in  favor  of  the  estate  or  not. 

Hill  vs.  Supreme  Council   Ameriran  Legion  of  Honor,  March,   1901, 
178  Mass.  145. 

Beneficiary — Right  of  Widow  versus  Executor. 

A  society  was  organized  to  assist  the  widows  and  orphans  of  de- 
ceased members  and  to  pay  benefits  to  such  person  or  persons  be- 
longing to  these  classes  as  might  hold  an  assignment  of  the  certifi- 
cate of  membership  at  the  time  of  the  death  of  the  member.  The 
member  died  intestate  leaving  a  widow  but  no  child,  and  never 
having  designated  a  beneficiary  in  writing  nor  having  made  any 
assignment  of  his  certificate.  It  was  held  in  a  contest  between  the 
widow  and  the  administrator  of  the  member's  estate  that  the  widow 
was  entitled  to  take  the  amount  of  the  certificate. 

Hadley   vs.   Odd   Fellows  Beneficial  Assn.,  January,  1899,  173   Mass. 
583. 

After-enacted  Laws — Cutting  Down  Benefits. 

At  the  time  when  a  member  joined  a  society  there  was  a  by-law 
providing  for  $5.00  a  week  sick  benefit  to  be  paid  during  the  time 
of  disability  not  exceeding  thirteen  weeks  in  each  year.  Subse- 
quently this  by-law  was  amended  so  as  to  provide  when  a  member 
had  received  39  weeks  of  sick  benefits,  he  should  thereafter  receive 
only  one  dollar  per  week  instead  of  five  dollars  per  week  for  thirteen 
weeks  of  each  .year  during  a  term  of  five  years.  It  was  held  that 
this  amendment  not  onlj'  applied  to  all  members  who  were  in  the 
society  prior  to  the  passage  of  same,  but  also  to  those  who  wei'e 
under  disability  at  the  time  of  the  amendment  going  into  effect. 

Pain  vs.  Societe  St.  Jean  Baptists.  January,  1899,  172  Mass.  319. 
29 


450  FRATERNAL    SOCIETY   LAW 

Beneficiaries,  Assignment  to  Creditor. 

Prior  to  the  passage  of  the  present  fraternal  beneficiary  law  of 
Massachusetts  in  a  case  before  the  Supreme  Court  of  that  State  it 
was  held  that  a  society  incorporated  in  another  State  admitted  to  do 
business  in  that  State  might  issue  a  certificate  to  a  member  payable 
to  himself  as  beneficiary,  and  he  might  assign  same  for  a  valid 
debt  larger  than  the  amount  of  the  benefit  payable  tliereunder  and 
that  such  assignment  would  confer  upon  the  assignee  an  equitable 
right  upon  the  fund  after  the  member's  death,  which  right  would 
prevail  over  the  legal  title  of  the  administrator  of  the  member's 
estate.  i 

Brlerly  vs.  Equitable  Aid  Union.  January,  1898,  170  Mass.  218. 


THE    STATE    OF    MICHIGAN  45I 


THE 

STATE   OF   MICHIGAN. 

CHAPTEE  23. 

(The  Section  luinibers  enclosed  in  parenthesis  con-espond  to  those 
in  the  1907  etlition  of  tlie  Insurance  Laws  of  ]Michigan.  while  the 
numbers  preceded  by  the  sign  §  correspond  to  those  in  the  Com- 
piled Laws  of  1897.) 

An  Act  to  define  what  shall  constitute  Fraternal  Beneficiary  So- 
cieties, Orders,  or  Associations;  to  provide  for  their  incorpora- 
tion and  the  regulation  of  their  business,  and  for  the  punishment 
for  violation  of  the  provisions  of  the  act  of  their  incorporation, 
and  to  repeal  all  existing  acts  inconsistent  therewith. 

The  People  of  the  State  of  Michigan  enact: 

(144)  §  7740.  Section  1.  That  a  fraternal  beneficiary  association 
is  hereby  declared  to  be  a  corporation,  society  or  voluntary  asso- 
ciation having  a  lodge  system  with  ritualistic  fonii  of  woriv  and  a 
representative  form  of  government,  formed  t)r  organized  and  car- 
ried on  for  the  sole  benefit  of  its  members  and  their  beneficiaries 
and  not  for  profit.  Such  association  making  provision  for  the  pay- 
ment of  death  benefits,  may,  in  addition  thereto,  provide  for  the  pay- 
ment of  benefits  in  the  case  of  accident,  sicl\ness,  disability,  or  old 
age  of  its  members.  The  fund  from  which  the  paj^ment  of  such  benefits 
shall  be  made,  and  the  fund  from  which  the  expenses  of  such  asso- 
ciation shall  lie  defrayed,  shall  be  derived  from  assessments  or 
dues  collected  from  its  niemliers.  Payment  of  death  benefits  shall 
be  made  only  to  the  wife,  husband,   children  and  dependent  chil- 


^52  FRATERNAL    SOCIETY    LAW 

dren,  mother,  father,  sister,  brother,  or  blood  relatives  to  the  fourth 
decree  of  the  member :  Provided,  That  where  an  applicant  or  mem- 
ber has  no  relative  as  above  provided,  to  whom  he  may  make  his 
certificate  payable,  in  sneh  case  he  may  designate  any  other  person 
or  make  his  estate  his  beneficiary.  Such  association  shall  be  gov- 
erned by  this  act  and  shall  be  exempt  from  the  provisions  of  the 
insurance  laws  of  this  State,  excepting  as  provided  by  this  act: 
Provided,  further.  That  when  the  laws  of  any  such  association  al- 
ready provide  that  an  aiifianeed  wife,  or  any  other  person  who  is 
dependent  upon  the  member  for  maintenance,  food,  clothing,  lodging 
or  education,  may  be  made  the  beneficiary,  payment  of  death  bene- 
fits may  be  made  to  such  beneficiaries,  but  no  certificate  of  mem- 
bership shall  be  made  payable  to,  nor  any  death  benefit  paid  to 
an  affianced  wife,  or  any  beneficiary  by  reason  of  dependency  as 
hereinbefore  provided,  unless  satisfactory  proof  of  such  affianced 
relation  or  dependency  shall  have  been  filed  with,  and  accepted 
by,  the  executive  officers  of  such  association :  And  provided  fur- 
ther, That  no  death  claim  shall  be  a  valid  claim  against  any  such 
association,  where  the  deceased  member  came  to  his  or  her  death 
by  unlawful  means,  at  the  hands  or  through  the  procurement  or 
connivance  of  the  beneficiary  named  therein,  and  as  to  such  bene- 
ficiary, the  benefit  certificates  issued  to  such  deceased  member  shall 
become  null  and  void  :  Provided,  That  the  provisions  of  this  section 
requiring  a  ritualistic  form  of  work  shall  not  apply  to  the  New 
Era  Association  of  Grand  Rapids,  heretofore  incorporated  and  doing 
business  under  the  provisions  of  this  act. 
Am.  1901,  Act  226. 

(145)  §  7741,  Section  2.  Any  number  of  persons  not  less  than 
nine,  residents  of  the  State  of  Michigan,  and  citizens  of  the  United 
States,  hereafter  desiring  to  form  a  fraternal  beneficiary  society, 
order  or  association  for  the  purpose  set  forth  in  section  one  of  tliis 
act.  may  associate  themselves  together  and  effect  such  organiza- 
tion as  hereinafter  prescribed  and  not  otherwise. 

(146)  §  7742.  Section  3.  All  such  associations  coming  within 
the  description  as  set  forth  in  section  one  of  this  act.  organized 
under  the  laws  of  this  or  any  otlu'r  State,  jiroviuce  or  territory, 
and   now  doing  l>nsiiu'ss  in   this  Stale,   and   :ill   associations  of  anv 


•  THE    UTATE    OF    MICHIGAN  453 

other  State  which  have  been  authorized  by  the  commissioner  of 
iiisuriiiicc  to  do  business  in  this  State  ;nid  have  been  iloin-;-  business 
herein  for  the  period  of  five  years  and  upwards,  may  eontiniic  tlicir 
business:  Provided,  that  they  hereafter  comply  with  the  provisions 
of  this  act  regulating  amnial  reports  and  the  designation  of  the 
conunissioner  of  insurance  as  the  person  upon  whom  process  may 
be  served  as  hereafter  pmviiled:  And  provided  further,  That  suits 
may  be  commenced  in  the  circuit  court  in  any  county  where  the 
plaintiff  resides,  by  declaration  or  writ,  and  service  shall  be  made 
in  such  eases  only  upon  the  conimissionei*  of  insurance  in  like  man- 
ner and  with  like  effect  as  is  hereinafter  ])ri)vided  for  the  service 
of  j)rocess  upon  societies,  orders  or  associations  organized  under 
the  laws  of  any  other  State,  province  or  territory  and  doing  busi- 
ness in  this  State,  and  not  having  its  principal  office  within  this 
State,  and  for  the  purpose  of  service  of  process  as  herein  provided 
such  society,  order  or  association  shall  appoint  in  writing  the  com- 
missioner of  insurance,  or  his  successor  in  office,  to  be  its  true  and 
lawful  attorney:  And  provided  further,  That  the  trial  judge  may, 
when  there  is  a  recovery  by  the  plaintiff  in  any  suit  commenced  in 
the  circuit  court,  award  costs  to  plaintiff,  notwithstanding  the  fact 
that  the  amount  recovered  is  less  than  one  hundred  dollars. 

Am.  1903,  Act  44 ;  1907,  Act  175. 

(147)  §  7743.  Section  4.  Any  such  association  coming  within 
the  description  as  set  forth  in  section  one  of  this  act,  organized 
under  the  laws  of  any  other  State,  province  or  territory,  and  not 
noM-  doing  business  in  this  State,  shall  be  aduiitted  to  do  business 
within  this  State  when  it  shall  have  filed  with  the  commissioner 
of  insurance  a  duly  certified  copy  of  its  charter  and  articles  of 
association,  and  a  copy  of  its  constitution  or  laws,  certified  to  by 
its  secretary,  or  corresponding  officer,  satisfactory  proof  to  the  eft'eet 
that  such  association  has  paid  all  death  claims  in  full  for  the  period 
of  at  least  one  year  immediately  preceding,  together  with  an  a])- 
pointment  of  the  commissioner  of  insurance  of  this  State,  as  a  person 
upon  whom  process  may  be  served  as  hereinafter  provided:  And 
provided.  That  such  association  shall  be  shown  by  certificate  to 
be  authorized  to  do  business  in  the  State,  province  or  territory  in 
whicli  it  is  inoor]iorated  or  organized  in  case  the  laws  of  such  State, 


4»i 


FRATERNAL   SOCIETY   LAW 


province  or  territon-  shall  provide  for  such  autliorizatiou ;  and  in 
case  the  laws  of  such  State,  province  or  territory  do  not  provide 
for  an}-  formal  authorization  to  do  business  on  the  part  of  any  such 
association,  then  such  association  shall  be  shown  to  be  conducting 
its  business  in  accordance  with  the  provisions  of  this  act,  for  which 
purpose  the  commissioner  of  iUjSurance  of  this  State  may,  person- 
ally, or  by  some  person  to  be  designated  by  him.  examine  into 
the  condition,  affairs,  character  and  business  methods,  accounts, 
books  and  investments  of  such  association  at  its  home  office,  which 
exainination  shall  be  at  the  expense  of  such  association. 

(148)  §  7744.  Section  5.  Every  such  association  doing  business 
in  this  State  shall,  on  or  before  the  first  day  of  March  of  each 
year,  make  and  file  with  the  commissioner  of  insurance  of  this 
State  a  report  of  its  affairs  and  operations  during  the  year  ending 
on  the  thirty-first  day  of  December  immediately  preceding,  to- 
gether with  a  copy  of  its  constitution  and  laws  then  in  force,  which 
annual  report  shall  be  in  lieu  of  all  other  reports  required  by  any 
other  law.  Upon  receiving  such  report  and  copy  of  the  laws  or 
constitution  the  commissioner  shall  examine  them  and  if  they  are 
foimd  to  be  in  conformity  with  the  provisions  of  this  act  he  shall 
issue  to  such  association  a  license  or  certificate  of  authority  to  con- 
tinue its  bu.siness  for  another  year,  and  no  such  association  shall 
be  authorized  to  do  any  business  unless  so  licensed  Such  reports 
shall  be  upon  blank  forms  to  be  provided  by  the  commissioner  of 
insurance,  or  may  be  jn-inted  in  pamphlet  form,  and  shall  be  verified 
under  oath  by  the  duly  authorized  officers  of  such  association,  and 
shall  be  published,  or  the  substance  thereof,  in  the  annual  repoi-t  of 
the  commissioner  of  insurance  under  a  separate  part  entitled  "Fra- 
terual  Beneficiary  Associations."  and  shall  contain  answers  to  the 
following  questions: 

1.  .\uiiil)er  of  certificates  issued  during  the  year,  or  members  ad- 
mitted. 

2.  Amount  of  indemnity  effected  thereby. 

•'5.     .Vumber  of  lo.sses  or  benefit  liabilities  incurred. 

4.  Xinubei-  (if  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Tnlal  MiiKiuiil  jjaid  members  or  beneficiaries. 


THE    STATE    OF   MICHIGAN  455 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and 
brief  statement  of  reasons. 

9.  Does  association  charge  annual  or  other  periodical  dues  or 
admission  fees? 

10.  How  much  on  each  one  thousand  dollars  annually  or  per 
capita,  as  the  ease  may  be. 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  association  guarantee,  in  its  certificate,  fixed  amounts 
to  be  paid  regardless  of  amount  realized  from  assessments,  dues, 
admission  fees  and  donations? 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  such 
guaranty. 

15.  Has  the  association  a  reserve  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested. 

17.  Has  the  association  more  than  one  class? 

18.  If  so,  how  many  and  the  amount  of  indemnity  in  each. 

19.  Number  of  members  in  each  class. 

20.  If  a  voluntary  association,  so  state,  and  give  date  of  or- 
ganization. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time,  giving  chapter  and  year  and  the  date  of  passage 
of  the  act. 

22.  If  organized  under  the  laws  of  any  other  State,  province 
or  territory,  state  such  fact  and  the  date  of  organization,  giving 
chapter  and  year  and  date  of  passage  of  the  act. 

23.  Number  of  benefit  certificates  lapsed  during  the  year. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more 
than  one  class,  number  in  each  class. 

25.  Names  and  address  of  its  president,  secretary  and  treasurer, 
or  corresponding  officers. 

The  commissioner  of  insurance  is  authorized  and  empowered  to 
address  any  additional  inquiries  to  any  such  association  in  relation 


456  FRATERNAL    SOCIETY    LAW 

to  is  doings  or  condition,  or  any  other  matter  connected  with  its 
transactions  relative  to  the  business  contemplated  by  this  act,  and 
such  ofBcei-s  of  such  association  as  the  commissioner  of  insurance 
may  require  shall  properly  reply  in  writing  under  oath  to  all  such 
inquiries. 

(149)  §  7745.  Section  6.  Each  such  association  now  doing  or 
hereafter  admitted  to  do  business  in  this  State  and  not  having  its 
principal  office  within  this  State,  and  not  being  organized  under 
the  laws  of  this  State  shall  appoint  in  writing  the  commissioner 
of  insurance  or  his  successor  in  office  to  be  its  true  and  lawful 
attorney  upon  whom  all  lawful  process  in  any  action  or  proceeding 
against  it  may  be  served,  and  when  so  served  on  said  attorney, 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
association,  and  that  the  authority  shall  continue  in  force  so  long 
as  any  liabilitj-  remains  outstanding  in  this  State.  Copies  of  such 
certificate,  certified  by  said  commissioner  of  insurance,  shall  be 
deemed  sufficient  evidence  thereof,  and  shall  be  admitted  in  evi- 
dence with  the  same  force  and  effect  as  the  original  thereof  might 
be  admitted.  When  legal  jjrocess  against  any  such  association  is 
served  upon  said  commissioner  of  insurance,  he  shall  immediately 
notify  the  association  of  such  service  by  letter  prepaid  and  directed 
to  its  secretary,  or  corresponding  officer;  and  shall  within  two  days 
after  such  service  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him  to  such  officer.  The  plaintiff  in  such  process  so  served 
shall  pay  to  the  commissioner  of  insurance  at  the  time  of  such 
service  a  fee  of  three  dollars,  which  shall  be  recovered  by  him  as 
part  of  the  taxable  costs,  if  he  prevails  in  the  suit.  The  commis- 
sioner of  insurance  shall  keep  a  record  of  all  processes  served  upon 
him,  which  record  shall  show  the  day  and  hour  when  such  service 
was  made. 

(150)  §  7746.  Section  7.  The  commissioner  of  insurance  of 
this  State  shall  upon  the  application  of  any  association  having  the 
right  to  do  business  within  this  State  as  provided  by  this  act,  issue 
to  such  association  a  permit  in  writing  authorizing  such  association 
to  do  business  within  this  State,  for  M-hich  certificate,  and  all  pro- 
ceedings in  connection  therewith,  such  association  shall  pay  to  said 
commissioner  the  fee  of  five  dollars. 


THE    STATE    OF    MICH  WAN  457 

(151)  §  7747.  Section  8.  Such  persons  as  provided  in  section 
two  of  this  act  shall  file  in  the  office  of  the  commissioner  of  insur- 
ance a  declaration  signed  by  each  of  the  corporators,  and  duly 
acknowledged  before  an  officer  authorized  under  the  laws  of  this 
State  to  take  acknowledgment  of  deeds,  and  shall  therein  express 
their  intention  to  form  a  fraternal  beneficiary  society,  order  or  asso- 
ciation for  fraternfil  beneficiary  purposes.  Said  declaration  shall 
also  eont;iin  the  proposed  name  of  the  society,  order  or  association, 
which  shall  not  be  the  same  as,  nor  too  closely  resemble,  the  name 
of  any  other  society,  order  or  association  organized  under  the  laws 
of  this  State,  or  doing  business  in  this  State ;  the  mode  and  manner 
in  which  the  corporate  powers  granted  by  this  act  are  to  be  exer- 
cised; the  place  of -doing  business  fully  and  clearly  defined;  the 
limit  as  to  age  of  api)licant  for  lieueficiary  membership,  which  shall 
not  exceed  fifty-five  years,  and  that  medical  examinations  are  re- 
quired of  applicants  for  life  benefits;  the  names  and  official  titles 
of  the  officers,  trustees  and  directors,  representatives  or  other  per- 
sous,  by  whatsoever  name  or  title  designated,  having  and  exercising 
the  general  control  and  management  of  its  affairs  and  all  its  funds, 
who  shall  be  elected  after  the  first  year  by  representatives  chosen 
by  the  subordinate  lodges,  councils  or  bodies,  or  grand  lodges,  grand 
councils  or  bodies,  as  the  laws  of  the  society,  order  or  association 
may  provide,  and  who  shall  be  members  of  such  society,  order  or 
association.  The  president,  secretary  and  treasurer  or  correspond- 
ing officers  of  such  association,  shall  be  residents  of  the  State  of 
Michigan  and  citizens  of  the  United  States. 

Am.  1901,  Act.  160;  1905,  Act.  3. 

(152)  §  7748.  Section  9.  Upon  the  filing  in  the  office  of  said 
commissioner  of  the  declaration  required  by  the  last  preceding  sec- 
tion, together  with  the  sworn  statement  by  three  of  said  corporators 
that  at  least  two  hundred  persons  eligible  under  the  proposed  laws 
of  such  society,  order  or  association,  to  membership  therein,  have 
in  good  faith  made  application  in  writing  for  membership,  and  if 
by  him  found  conformable  to  the  requirements  of  this  act,  and  not 
inconsistent  with  the  constitution  and  laws  of  the  United  States 
and  of  this  State,  he  shall  thereupon  deliver  to  such  society,  order 
or  association  a  certified  copy  of  the  papers  so  filed  and  recorded 


458 


FRATERNAL    SOCIETY    LAW 


in  his  office,  together  with  a  license  or  certificate  of  said  commis- 
sioner to  such  society,  order  or  association,  to  carry  on  the  work 
of  a  fraternal  beneficiary  society,  order  or  association  as  proposed 
in  said  declaration.  Upon  such  certified  copy  and  license  or  certifi- 
cate being  filed  in  the  office  of  the  commissioner  of  insurance,  and 
when  at  least  two  hundred  persons  have  subscribed  in  writing  to 
be  beneficiary  members  therein  and  have  paid  in  one  full  assessment 
in  cash  according  to  its  proposed  laws,  and  the  commissioner  of  in- 
surance shall  have  certified  that  it  has  complied  with  the  provisions 
of  this  act  and  is  authorized  to  transact  business,  the  said  corpora- 
tors and  those  who  may  hereafter  become  associated  with  them, 
or  their  successors  shall  be  constituted  a  body  politic  and  corporate, 
with  the  powers  and  privileges  of  a  fraternal  beneficiary  society, 
order  or  association.  Such  society,  order  or  association  may,  by  a 
vote  of  the  governing  body,  hold  its  regular  stated  meetings  in  any 
State  or  territory  in  the  United  States,  or  in  any  province  of  Canada 
where  subordinate  lodges,  councils  or  bodies  may  exist  and  are  under 
the  jurisdiction  of  the  supreme,  grand  or  governing  lodges;  and 
all  business  transacted  at  anj^  such  meetings  shall  have  the  same 
force  and  effect  as  if  transacted  in  this  State. 

Am.  1901,  Act.  160. 

(153)  §  7749.  Section  10.  Any  fraternal  beneficiary  society,  or- 
der or  association,  as  defined  by  section  one  of  this  act,  transacting 
business  in  this  State,  and  incorporated  under  the  laws  of  this  State, 
may  reincorporate  under  the  provisions  of  this  act  by  filing  with 
said  commissioner  a  declaration  adopted  by  the  board  of  trustees, 
directors,  council,  committee,  or  other  governing  body  of  said  asso- 
ciation and  signed  and  duly  acknowledged  by  the  president,  secre- 
tary and  treasurer  with  the  seal  thereof,  which  shall  contain  the 
name  of  such  corporation,  the  mode  and  manner  in  which  the  corpo- 
rate powers  granted  by  this  act  are  to  be  exercised,  the  name  and 
official  title  of  the  officers,  trustees,  representatives,  or  other  persons, 
by  whatsoever  name  or  title  designated,  who  are  to  have  and  exer- 
cise the  general  control  and  management  of  its  affairs  and  all  its 
funds,  and  the  mode  and  manner  of  their  selection,  and  the  place 
where  the  principal  office  for  the  transaction  of  business  within  the 
State  is  located.    Upon  the  filins-  in  the  office  of  said  commissioner 


THE    STATE    OF    MICHIGAN  4;;9 

of  the  declai'atioii  lierein  required,  together  witli  the  sworn  stiite- 
iiietit  of  tlirce  of  said  officers,  that  at  h^ast  two  hundred  persons  are 
bdiia  tide  iiii'iiihers  of  said  socii'ty,  (ir(hjr  or  assdcial  ion.  and  llial  hik; 
full  assessment  has  been  i)aid  in  according  to  its  laws,  and  if  found 
conformable  to  the  pi'ovisions  of  this  act;  the  said  commissioner  shall 
record  and  deliver  to  such  association  or  society  a  certilied  eoiiy 
of  such  declaration  and  such  certificate,  together  with  his  license  to 
carry  on  the  work  of  a  fraternal  beneficiary  society,  order  or  asso- 
ciation, as  proposed  in  said  declaration ;  and  upon  the  same  being 
filed  in  the  office  of  the  clerk  of  the  county  wherein  the  principal 
office  for  the  transaction  of  its  business  is  located,  the  said  society, 
order  or  association  shall  thereupon  be  duly  incorporated  under 
the  provisions  of  this  act:  Provided  always.  That  nothing  in  this 
act  contained  shall  be  construed  as  requiring  or  making  it  obligatory 
upon  any  existing  fraternal  beneficiary  society,  order  or  association 
to  reincorporate  under  the  provisions  of  this  act. 

(154)  §7750.  Section  11.  Any  subordinate  body  of  any  frater- 
nal beneficiary  society,  order  or  association,  incorporated  under  the 
provisions  of  this  act,  or  of  any  such  society,  order  or  association 
now  doing  business  or  may  hereafter  be  admitted  to  do  business  in 
this  State  under  this  act  may  become  a  body  corporate  in  the  manner 
following:  At  some  regular  meeting  of  such  subordinate  body  a 
resolution  expressing  the  desire  of  such  subordinate  body  to  be 
incorporated  and  directing  its  officers  to  perfect  such  incorpor- 
ation, shall  be  submitted  to  a  vote  of  the  members  present, 
and  if  two-thirds  of  the  members  present  and  voting  [vote]  therefor, 
the  ]n-esident  and  secretary  of  such  subordinate  bod.y,  or  the  officers 
holding  relative  offices  therein,  shall  prepare  articles  of  association 
under  their  hands  and  the  seal  of  such  subordinate  body  setting  forth 
first,  the  number  of  members  of  such  subordinate  body  then  in  good 
standing;  second,  the  name  by  which  said  subordinate  body  is 
known ;  third,  the  date  of  its  organization  and  the  period  for  which 
it  is  to  be  incorporated,  not  exceeding  thirty  years. 

(155)  §  7751.  Section  1'2.  A  copy  of  such  articles  of  associa- 
tion shall  be  filed  with  the  county  clerk  of  the  county  within  which 
such  subordinate  body  holds  its  stated  meetings,  and  shall  by  him 
be  recorded,  together  with  the  affidavit  hereafter  named  by  such 
clerk,  in  a  bonk  In  be  kp])t  for  tliat  jiurpose. 


460  FRATERNAL    SOCIETY    LAW 

(156)  S  7752.  Section  18.  On  the  execution  of  said  articles  of 
association  and  before  the  filing  thereof  with  the  county  clerk,  the 
seeretarj'  of  such  subordinate  body  shall  annex  thereto  his  affidavit 
stating  that  he  is  a  member  in  good  standing  in  such  subordinate 
body  and  occupies  the  position  of  secretary,  or  the  office  correspond- 
ing therewith  therein,  and  that  the  resolution,  a  copy  of  which  shall 
be  set  forth  at  length,  was  regularly  passed  at  a  regular  meeting 
of  said  subordinate  body  and  received  the  vote  of  two-thirds  of 
the  members  ])resent  and  voting,  and  that  to  the  best  of  his  knowl- 
edge and  belief  the  statement  made  in  the  articles  of  association  are 
true,  and  that  such  subordinate  body  is  organized  and  acting  under 
the  laws  of  its  respective  soeietj',  order  or  association,  giving  the 
name  by  which  such  society,  order  or  association  is  incorporated. 

(157)  §  7753.  Section  14.  When  the  foregoing  reqiiirements 
are  complied  with  such  subordinate  body  shall  be  a  body  corporate 
by  the  name  expressed  in  such  articles,  and  liy  that  name  shall 
be  a  person  in  law  capable  of  siiing  and  being  sued  in  the  courts, 
and  taking  and  holding  property  of  every  kind  the  same  as  natural 
persons,  and  a  copy  of  said  articles  of  association  duly  certified  to 
by  the  clerk  of  the  county,  in  whose  jiossession  they  are,  shall  be 
pi-ima  facie  evidence  in  all  courts  and  places  of  the  existence,  and 
the  due  incorporation  of  such  subordinate  body. 

(158)  §  7754.  Section  15.  The  money  or  other  benefit,  charity, 
relief  or  aid  to  be  jjaid,  provided  or  rendered  by  any  association 
authorized  to  do  business  iinder  this  act,  shall  not  be  liable  to  attach- 
nuMit  l)y  trustee,  g;iriiishee  or  other  process,  and  shall  not  be  seized, 
taken,  appropriated  or  applied  by  any  legal  or  equitable  process,  or 
by  operation  of  law,  to  pay  any  debt  or  liability  of  a  certificate 
holder,  or  of  any  beneficiary  named  in  a  certificate,  or  of  any  person 
who  limy  have  any  right  thereunder.  And  all  dues,  assessments 
and  oilier  jiaynients  and  the  accumulations  thereof,  held  and  pos- 
sessed b_\-  said  association  for  the  payment  of  death,  sick  or  disability 
benefits,  and  the  reserve,  emergency  and  other  mortuary  funds  of 
saiil  association  shall  be  exempt  from  taxation  for  State,  county  and 
municipal  purposes. 

Am.  1903,  Act.  53. 

('159')      ?  775.">.     Section  16.     Any  jierson,  otlicer,  meiulier  or  ex- 


THE    STATE    OF    MICHIGAN  461 

iiiiiiiiiiii^  pliysicijiii.  wild  sIimH  kii(i\viii,L;iy  or  wiH'iilly  iiiiil<('  any  false 
or  rramlnlont  statcniciit  or  representation,  in  or  witli  reference  to 
any  applieation  foi-  nieniherslii]).  or  for  the  purpose  of  obtaiiiini^  any 
money  oi-  lieiielil  in  any  association  ti'ansaetinu  liusiness  inider  this 
act,  shall  lie  guilty  of  a  misdemeanor,  and  upon  conviction  shall 
lie  iiunished  liy  a  line  of  not  less  than  one  hundred  dollars  nor  more 
than  live  hundred  dollars,  or  imiirisonment  in  the  county  jail  for 
not  less  than  thirty  days  nor  more  than  one  year,  or  both,  in  the 
discretion  of  the  court;  and  any  person  who  shall  wilfully  make  a 
false  statement  of  any  material  fact  or  thing  in  a  sworn  statejnent 
as  to  the  death  or  disability  of  a  cei-tificate  holder  in  any  such 
association  for  the  imi'pose  of  proenrint>-  payment  of  a  heiielit  named 
in  the  certificate  of  such  holder,  and  any  jierson  who  shall  wilfully 
make  any  false  statement  in  any  verified  report  or  declaration  under 
oath  required  or  authorized  by  this  act,  shall  be  guilty  of  perjui'y, 
and  shall  be  proceeded  against  and  punished  as  provided  by  the 
statutes  of  this  State  in  relation  to  the  crime  of  per.iury. 

(160)  §  7756.  Section  17.  An^-  such  association  refusing  or 
neglecting  to  make  the  report  as  jirovided  in  this  act,  shall  be  ex- 
eluded  Ironi  doing  business  within  this  State.  Said  commissioner 
of  insurance  must,  within  sixty  days  after  failure  to  make  such 
report,  or  in  case  any  .such  association  shall  exceed  its  powers  or 
shall  conduct  its  liusiness  fraudulently  or  shall  fail  to  comply  with 
any  of  the  provisions  of  this  act,  give  notice  in  writing  to  the  attorney 
general,  who  shall  immediately  commence  an  action  against  such 
association  to  en.join  the  same  from  carrying  on  any  business.  No 
association  so  proceeded  against  shall  have  authority  to  continue 
business  until  such  report  shall  be  made  or  overt  act  or  violations 
complained  of  shall  have  been  corrected,  nor  until  the  costs  of  such 
action  be  paid  by  it,  provided  the  court  shall  find  that  such  associa- 
tion was  in  default  as  charged,  whereujion  the  connnissioner  of  in- 
surance shall  reinstate  such  association,  and  luit  until  then  shall 
such  association  be  allowed  to  again  do  business  in  this  State.  An.v 
officer,  agent  or  person  acting  for  an.v  association  within  this  State 
or  for  a  subordinate  branch  thereof,  while  such  associatiou  shall 
be  so  en.ioined  or  prohibited  from  doing  business  pui'suant  to  this 
act,  shall  be  deemed  guiltv  of  a   misdeme'inor.  ami   on    eoii\iction 


462  FRATERNAL    SOCIETY   LAW, 

thereof,  shall  be  punished  by  a  fiue  uot  less  than  twenty-five  dollars 
nor  more  than  two  hundred  dollars,  or  by  imprisonment  in  the 
county  jail  not  less  than  thirty  days  nor  more  than  one  year,  or  by 
both  such  fine  and  imprisonment  in  the  discretion  of  the  court.  And 
no  injunction  against  any  such  association  shall  be  granted  by  any 
court  except  on  application  by  the  attorney  general,  at  the  request  of 
the  commissioner  of  insurance. 

(161)  §  7757.  Section  18.  Any  pei'sou  who  shall  act  within 
this  State  as  an  officer,  agent  or  otherwise,  for  any  association  which 
shall  have  failed,  neglected  or  refused  to  comply  with,  or  shall 
have  violated  any  of  the  provisions  of  this  act,  or  shall  have  failed 
or  neglected  to  prociire  from  the  commissioner  of  insurance  proper 
certificate  of  authority  to  transact  business  as  provided -for  by  this 
act,  shall  be  subject  to  the  j^enalty  provided  in  the  last  preceding 
section  for  the  misdemeanor  therein  specified. 

(162)  §  7758.  Section  19.  Nothing  in  this  act  shall  be  con- 
strued to  apply  to  any  corporation,  society  or  association  carrying 
on  the  business  of  life,  health,  casualty  or  accident  insurance  for 
profit  or  gain,  and  shall  only  apply  to  fraternal  beneficiary  societies, 
orders  or  associations  as  defined  by  section  one. 

(163)  §  7759.  Section  20.  Nothing  in  this  act  contained  shall 
be  construed  to  afl'ect  any  grand  or  subordinate  lodge  or  branch  of 
any  such  fraternal  beneficiary  societies,  order  or  association,  which 
limits  its  certificate  holders  to  a  particular  religious  denomination, 
or  to  the  emplo.ves  of  a  particular  town  or  city  designated,  firm,  busi- 
ne.ss  house  or  coi'poration,  nor  the  grand  or  subordinate  lodges  of  the 
Inde[)endent  Order  of  Odd  Fellows,  as  they  now  exist,  nor  any  grand, 
subDi'diiiate  lodge,  oi'  other  body  of  Free  and  Accepted  Masons,  nor 
the  grand  nor  any  subordinate  lodge  of  the  Knights  of  Pythias,  ex- 
clusive of  the  endowment  rank:  Provided,  That  the  United  States 
Benevolent  Society  of  Saginaw,  the  Michigan  Home  and  Hospital 
Association  of  Grand  Rapids,  the  National  Protective  Society  of  Bay 
City,  the  American  Benevolent  Society  of  Traverse  City,  heretofore 
inc()ri)orated  and  doing  business,  are  hereby  exem])te(l  from  the 
])rovisions  of  said  act  requiring  a  lodge  .syst<'iii  with  I'itualistic  form 
of  work,  on  complying  witli  all  olher  provisions  of  said  act. 

(164)      Section  '21.     Any  assdciation   iiicor]iorated  or  doing  busi- 


THE    STATE    OF    MICHIGAN  463 

ness  under  this  act  may  amend  its  articles  of  incorporation  at  any 
of  its  regular  stated  meetings  by  a  two-thirds  vote :  •  Provided,  That 
notice  of  intention  so  to  do  shall  be  published  in  the  official  organ, 
of  the  association  (in  the  event  such  association  has  no  official  organ, 
then  either  a  written  or  printed  notice  of  such  intention  shall  be 
miiiied  to  each  of  the  subordinate  bodies  of  such  association)  at 
least  sixty  days  prior  to  the  meeting  at  which  such  amendment  is  to 
be  considered.  All  such  amendments  and  the  proceedings  relating 
thereto,  together  with  proof  of  notice  as  above  provided,  shall  be 
duly  certified  and  filed  within  sixty  days  after  their  adoption  in 
the  office  of  the  commissioner  of  insurance. 

(165)  Section  22.  All  the  official  books,  papers,  records  and 
other  personal  property  belonging  to  associations  organized  vinder 
this  act,  or  any  subordinate  body  thereof,  shall  be  kept  at  the  home 
office  of  the  association,  except  in  the  case  of  said  subordinate  bodies 
the  same  shall  be  kept  in  such  place  as  the  laws  of  the  association 
shall  provide,  and  the  same  shall  at  all  times  be  open  to  the  inspec- 
tion of  the  commissioner  of  insurance.  And  any  officer  or  other 
person  who  shall  take,  carry  away,  or  in  any  manner  dispose  of 
said  books,  papers,  records,  or  other  personal  property  from  said 
home  office  or  other  place,  as  above  designated,  shall  be  deemed 
guilty  of  a  misdemeanor,  and  on  conviction  thereof  shall  be  subject 
to  the  same  penalty  provided  in  section  seven  thousand  seven  hun- 
dred fifty-six,  compiled  laws  of  eighteen  hundred  ninety-seven,  for 
the  misdemeanor  therein  specified;  Provided,  That  by  a  two-thirds 
vote  of  the  trustees,  directors  or  executive  council  having  general 
control  and  management  of  the  affairs  of  the  said  association,  such 
books,  papers,  records,  or  other  property  may  be  taken  into  the  pos- 
session of  and  retained  in  such  manner  as  such  trustees,  directors 
or  executive  council  may  direct. 

(166)  Section  23.  No  society  organized  under  the  laws  of  this 
State  shall  consolidate  with  any  other  society,  or  reinsure  its  risks 
or  any  pai't  thereof  with  any  other  society,  or  assume  or  reinsure  the 
whole  of  or  any  portion  of  the  risks  of  any  other  society,  except  as 
hereinafter  provided. 

(167)  Section  24.  When  any  such  society  shall  propose  to  con- 
solidate with  anv  other  society,  or  enter  into  any  contract  of  rein- 


464  FRATERNAL    bOCIETY    LAW 

surance,  it  shall  present  its  petition  to  the  commissioner  of  insurance 
of  this  State,  setting  forth  the  terms  and  conditions  of  such  proposed 
consolidation  or  reinsurance,  and  praying  for  the  approval  or  of  any 
modification  thereof,  which  the  commission  hereinafter  provided 
for  maj'  approve.  The  commissioner  of  insurance  shall  thereupon 
issue  an  order  of  notice,  requiring  notice  to  be  given  by  mail  to  the 
members  of  such  society,  of  the  pendency  of  such  petition,  and  the 
time  and  place  at  which  the  same  will  be  heard,  and  the  publication 
of  said  oi-der  of  notice  and  said  petition,  in  five  daily  newspapers 
designated  by  the  commissioner  of  insurance,  at  least  one  of  which 
shall  be  published  in  the  city  of  Lansing  for  at  least  two  Aveeks 
before  the  time  appointed  for  the  holding  of  such  hearing. 

(168)  Section  25.  The  governor  of  the  State  or  in  event  of  his 
inabilit}'  to  act,  some  competent  person  •  resident  of  the  State  to  be 
appointed  by  him,  the  attorney  general  of  the  State,  and  the  com- 
missioner of  insurance  of  the  State  shall  constitute  a  commission 
to  hear  and  determine  upon  said  petition.  At  the  time  and  place 
fixed  in  said  notice,  or  such  time  and  place  as  shall  be  fixed  by 
adjournment  said  commission  shall  proceed  with  said  hearing,  and 
may  make  such  examination  into  the  affairs  and  conditions  of  said 
society  as  it  may  deem  jjroper-.  The  commissioner  of  insurance  of 
this  State  shall  have  the  power  to  summon  and  compel  the  attend- 
ance and  testimony  of  witnesses  and  the  production  of  books  and 
papers  before  said  commission.  Any  policy  holder  or  member  of 
the  above  named  society  or  societies  may  appear  before  said  com- 
mission and  be  heard  in  reference  to  said  petition.  Said  commission, 
if  satisfied  that  the  interests  of  the  policy  holders  and  the  members  of 
such  society  or  societies  are  properly  protected  and  that  no  reason- 
able objection  exists  thereto,  may  approve  and  authorize  the  proposed 
consolidatif)n  or  reinsurance,  or  of  such  modification  thereof  as  may 
seem  to  it  best  for  the  interests  of  the  members  and  policy 'holders, 
and  said  commission  may  make  such  order  with  reference  to  the  dis- 
tribution and  disposition  of  the  surplus  assets  of  any  such  society 
thereafter  remaining,  as  shall  he  just  and  equitable.  Such  consolida- 
tion or  reinsurance  shall  only  be  approved  by  tlie  consent  of  all  the 
members  of  said  commission,  and  it  shall  be  the  di;ty  of  said  com- 
mission to  guard  the  interests  of  the  policy  holders  and  members 


THE    UTATE    Of    MICHIGAN  465 

of  any  sueii  .society  nr  societies  proposing  to  eonsolidate  or  reinsure. 
All  expenses  and  costs  incident  to  proceedings  under  this  section 
.shall  be  paid  by  the  society  or  societies  l)ringing  sand  petition. 

(1G9)  Section  26.  Any  officer  or  member  of  any  sucii  society  or 
societies  violating  or  consenting  to  the  violation  of  sections  twenty- 
three,  twenty -four  and  twentj'-flve,  or  any  of  them,  shall  be  punished 
by  tine  of  not  less  than  five  hundred  dollars  and  by  imprisonment  in 
the  county  jail  for  not  less  than  one  year. 

The  Attorney  General  of  iliclii^'an  has  ruled  ofHoially  that  the 
following  act  applies  to  Fraternal  Societies: 

An  Act  relating  to  the  provisions  of  Life  Insurance  Policies. 
The  People  of  the  State  of  Michigan  enact : 

(52)  Section  1.  Every  policy  of  insurance  issued  or  delivered 
within  this  State  on  or  after  the  first  day  of  January,  nineteen  hun- 
dred eight,  by  any  life  insurance  corporation  doing  business  within 
the  State  shall  contain  the  entire  contract  between  the  parties.  And 
nothing  shall  be  incorporated  therein  by  reference  to  any  constitu- 
tion, by-laws,  rules,  application  or  other  writing  unless  the  same  are 
endorsed  upon  or  attached  to  the  policy  when  issued. 
Section  2.     Repeals  inconsistent  acts. 

The  following  act  in  express  terms  applies  to  Fraternal  Societies 
though  it  does  not  attempt  to  amend  the  Fraternal  Society  in  the 
manner  pointed  out  by  law: 

An  Act  regulating  Life  Insurance  Companies  and  prohibiting  the 
diversion  of  funds  for  political  purposes. 

The  People  of  the  State  of  Michigan  enact: 

(57)  Section  1.  No  insurance  company  or  association,  includ- 
ing fraternal  beneficiary  associations,  doing  business  in  this  State 
shall,  directly  or  indirectly,  pay  or  use  or  offer,  consent  or  agree  to 
pay  or  use  and  money  or  property  for  or  in  aid  of  any  political 
party,  committee  or  organization,  or  for  or  in  aid  of  any  corporation, 
joint  stock  or  other  association  organized  or  maintained  for  political 
purposes,  or  for  or  in  aid  of  any  candidate  for  political  office,  or  for 
30 


466  FRATERNAL    HOCIETY    LAW 

nomination  for  such  office  or  for  any  political  purpose  whatsoever, 
or  for  the  reimbursement  or  indemnification  of  any  person  for  money 
or  property  so  used.  iVny  officer,  director,  stockholder,  attorney  or 
agent  of  any  corporation  or  association  which  violates  any  of  the 
provisions  of  this  act,  who  participates  ia,  aids,  abets,  or  advises 
or  consents  to  any  such  violation,  and  any  person  who  solicits  or 
knowingly  receives  any  money  or  property  in  violation  of  this  act, 
shall  be  guilty  of  a  misdemeanor  and  be  punished  by  imprisonment 
for  not  more  than  one  year  and  a  fine  of  not  more  than  one  thousand 
dollars,  and  any  officer  aiding  or  abetting  in  any  contribution  made 
in  violation  of  this  act,  shall  be  liable  to  the  company  or  association 
for  the  amount  so  contributed.  No  pei'sou  shall  be  excused  from  at- 
tending and  testif.ying,  or  producing  any  books,  papers  or  other  doc- 
uments before  any  court  or  magistrate  upou  any  investigation,  pro- 
ceeding or  trial,  for  a  violation  of  any  of  the  provisions  of  this  act, 
upon  the  ground  or  for  the  reason  that  the  testimony  or  evidence, 
documentary  or  otherwise,  reqi^ired  of  him  may  tend  to  incriminate 
or  degrade  him;  but  uo  person  shall  be  prosecuted  or  subjected  to 
any  penalty  or  forfeiture  for  or  on  account  of  any  transaction, 
matter  or  thing  concerning  which  he  may  so  testify  or  produce 
evidence,  documeutary  or  otherwise,  and  no  testimony  so  given  or 
produced  shall  be  used  against  him  upon  an.y  criminal  investigation 
or  proceeding. 

Section  2.     Repeals  inconsistent  acts. 

The  last  section  of  the  chapter  of  the  Michigan  Statutes  relating 
to  "Co-operative  and  Mutual  Life  Insurance"  reads,  viz.: 

(100)  Section  40.  Nothing  in  this  act  shall  be  construed  to  af- 
fect the  grand  or  subordinate  lodges  of  the  Independent  Order  of 
Odd  Fellows,  Free  and  Accepted  Masons,  Ancient  Order  of  United 
Workmen,  Knights  of  Pythias,  Modem  Woodmen  of  America, 
Knights  of  ]\Iaccabees  or  other  similarly  condi;cted  secret  societies, 
maintaining  grand  or  subordinate  lodges,  with  ritualistic  form  of 
work  and  representative  form  of  government,  which  may  be  now  or 
hereafter  formed  for  the  sole  benefit  of  members  and  their  beue- 
fieinrios,  and  not  for  the  profit  from  the  business  of  iusurnnce. 


THE    STATE    OF    MICHIGAN  4(57 

Beneficiaries — Trust  Agreement  for  Creditor. 

A  member's  certificate  was  payable  to  his  sister.  On  being  talten 
ill,  he  went  to  live  with  and  was  cared  for  b.y  his  aunt,  to  whom  he 
conveyed  land  more  than  sufficient  to  recompense  her  for  all  ser- 
vices that  she  might  render.  He  attempted  to  change  the  beneficiary 
in  his  certificate  and  to  designate  his  aunt,  but  the  sister  refused 
to  consent  to  the  change  by  surrendering  the  certificate  which  was 
in  her  possession.  Sub.sequently  the  member  executed  a  trust  agree- 
ment with  his  half-brother  whereby  the  latter  was  to  pay  over  the 
proceeds  of  all  that  he  miyhl  receive  under  the  certificate,  if  it  was 
paid  to  him,  except  one  hundred  dollars,  to  the  aunt,  and  the  certifi- 
cate outstanding  was  changed  and  a  new  one  issued  to  this  half- 
brother.  The  aunt  having  been  fully  paid  for  her  services,  the 
half-brother  claimed  the  advantages  of  the  benefit  certificate  and  re- 
pudiated the  trust  agreement.  It  was  held  that  he  was  entitled  to 
the  fund  and  was  not  estopped  to  deny  his  obligation  to  hold  it  as 
trustee  for  the  aiint. 

Knights    of    the    Modern    Maccabees    vs.    Grice,    Supreme    Court   of 
Michigan,  May,  1907,  111  N.  W.  1054. 

Beneficiary — Insurable  Interest. 

A  person  not  related  to  a  member  is  held  to  have  no  insurable  in- 
terest in  his  life  under  a  benefit  certificate  and  his  designation  of 
such  beneficiary  was  void  as  being  against  public  policy. 

Dolan  vs.  Supreme  Council  Catholic  Mutual  Benefit  Assn.,  Supreme 
Court  of  Michigan,  October,  1907,  113  N.  W.  10. 

Michigan  Contract. 

Where  a  member  resided  in  Michigan  and  was  a  member  of  a  local 
lodge  of  the  society  in  that  State,  and  a  certificate  issued  to  him  had 
to  be  countersigned  by  the  local  officers  of  such  lodge,  the  societv 
being  a  foreign  corporation,  it  was  held  that  the  contract  was  to  be 
regarded  as  a  Michigan  Contract,  and  its  validity  determined  by 
the  law  of  ilichigan.  and  that  it  was  to  be  assumed  that  the  certifi- 
cate was  delivered  at  the  place  of  the  residence  of  the  member. 


468  FRATERNAL    SOCIETY    LAW 

Dolan  vs.  Supreme  Council  Catholic  Mutual  Benefit  Assn.,  Supreme 
Court  of  Michigan,  October,  1907,  113  N.  W.  10. 

Resort  to  Civil  Courts. 

A  member  claimed  total  ami  permanent  disability  benefits  in  Jan- 
uarj',  1900,  and  the  claim  was  denied  in  May,  1900,  but  notice  of  the 
soeiet}''s  decision  was  not  siven  until  in  February,  1903,  and  not 
received  bj-  the  member  until  in  ^lay  or  June  following.  The  laws 
of  the  society  permitted  twenty  days  from  the  date  of  the  decision 
in  any  such  case  for  appeal  to  the  executive  council  and  provided 
also  that  the  member  should  be  notified  at  once  of  the  decision,  and 
that,  failing  to  appeal  within  the  jn-eseribed  time,  he  should  be 
bound  by  the  decision,  and  that  no  action  should  be  brought  until 
all  remedies  provided  by  the  laws  of  the  society  had  been  exhausted. 
It  was  held  that  in  this  ease  all  remedies  provided  for  by  the  societ.y 
had  been  exhausted  and  that  suit  might  be  bi-onght  in  the  courts. 

Steiner   vs.   Supreme  Council    Independent   Order   of  Foresters,   Su- 
preme Court  of  Michigan.  October,  1907.  113  N.  W.  15. 

Contract  for  Cash  Benefits  Ultra  Vires. 

In  1892  a  certificate  was  issued  to  a  memlu'r  who  was  then  fift}' 
years  old,  which  provided  for  animal  payments  to  him  by  the  society 
when  he  should  become  seventy  years  old,  such  payments  to  be  in 
the  nature  of  disability  benefits.  In  1894  the  society  reincorporated 
tmder  the  Michigan  laws  of  1893,  and  in  1895  the  society  passed  a 
by-law  relieving  its  members  from  paying  dues  and  assessments  after 
they  became  seventy  years  of  age  and  entitling  them  to  such  benefits 
as  were  promised  in  the  original  certificate.  It  was  held  that  the 
contract  was  ultra  vires. 

Wineland  vs.  Knights  of  the  Maccabees  of  the  World,  Supreme  Ct. 
Mich.,  July,   1907,  112   N.  W.   696. 

After-enacted  Laws  Binding. 

An  agreement  between  members  of  a  fraternal  society  and  i1  that 
they  shall  be  bnnnd  by  after-enacted  bv-laws  is  valid. 


THE    STATE    OF    MICHIGAN  469 

Wineland  vs.  Knights  of  the  Maccabees  of  the  World.  Supreme  Court 
of  Michigan,  July,   1907,  112  N.  W.  696. 

Increasing  Member 's  Payment. 

With  respect  to  the  risjlit  of  a  society  to  increase  the  assessments 
of  members  after  their  contracts  have  been  issued,  the  Court  said  : 

"We  have  no  doubt  that  it  was  lawful  and  no  violation  of  contract 
I'iuhts  for  defendant  to  increase  the  number  of  assessments  to  meet 
the  demands  arising  from  the  deaths  of  members.  There  seems  to 
be  no  great  reason  why  fewer  assessments  at  a  greater  rate  should 
not  be  levied,  so  long  as  the  increase  in  rates  is  pro])oi'ti(inal ;  young 
and  old  members  alike  contrlliiiting.  Whether  such  ai-tiim  be  n  mere 
detail  in  management  aimed  to  procure  for  distribution  the  same  sum 
of  money  in  a  different  way,  or  intended  to  actually  increase  the  con- 
tributions over  present  necessities  for  distribution  and  to  accumulate 
a  fund,  it  may  be,  so  long  as  it  is  proportional  and  reasonable,  sup- 
ported as  against  a  protesting  member  by  his  agreement  in  his  appli- 
cation to  conform  to  and  be  governed  by  laws  to  be  from  time  to  time 
made  by  the  representative  governing  body  of  the  association." 

Wineland  vs.  Knights  of  the  Maccabees  of  the  World,  Supreme  Court 
of  Michigan,  July,  1907,  112  N.  W.  69G. 

Beneficiary — "Member  of  Family." 

A  by-law  of  a  fraternal  soeietv  authoi'ized  l)enef]t  certificates  to 
be  made  j)ayable  to  persons  belonging  to  the  "members  of  the 
family"  of  the  member.  The  wife  of  a  member  took  from  a  found- 
ling asylum  in  1879  a  child  who  was  never  legally  adopted  by  either 
the  member  or  his  wife,  but  resided  with  them  from  1879  to  1887 
when  the  member  and  his  wife  separated  until  1890,  during  which 
time  the  orphan  remained  with  the  wife.  The  member  and  his  wife 
reunited  in  1890,  living  together  until  19(12.  when  the.v  were  di- 
vorced. In  1901  the  nrphaii  worked  in  a  m-arby  eity.  but  spent  his 
Sundays  with  the  member  and  the  member's  wife,  and  in  1902  he 
married.  It  was  held  that  such  a  person  was  not  entitled  to  take 
the  benefit  due  under  the  member's  certificate. 

Grand  Lodge  A.  O.  XJ.  W.  vs.  McKay,   Supreme  Court  of  Michigan. 
July,  1907,  112  N.  W.  730. 


470  FRATERNAL    SOCIETY    LAW 

Limitations — Time  to  Sue. 

A  contract  of  insurance  provided  that  no  suit  should  be  maiji- 
tained  after  six  montlis  from  the  date  on  wliit-h  proof  of  loss  was 
required  to  be  filed.  This  provision  was  upheld  by  the  courts.  For 
the  facts  in  the  case,  see 

Harris  vs.  Phoenix  Accident  and  Sick  Benefit  Assn.,  Supreme  Court 
of  Michigan,  July,  1907,  112  N.  W.  935. 

Warranty  Not  Waived  by  Knowledge  of  Agents. 

An  api)licant  for  membership  answered  a  question  propounded 
to  him  in  the  application  stating  that  he  had  never  been  insane, 
which  was  not  true.  It  was  known  to  himself,  the  agent  who  took 
the  application  and  the  physician  who  made  the  examination  that 
the  member  had  been  insane.  Nevertheless  the  society  was  held  not 
to  be  estopped  to  deny  the  truth  of  the  answer. 

Mudge  vs.   Supreme  Court  Independent   Order  of  Odd   Fellows,   Su- 
preme Court  Michigan,  September,  1907,  112  N.  W.  113. 

Warranty,  Breach  of. 

Where,  in  a  suit  on  a  certificate,  the  certificate  and  medical  exami- 
nation were  sufficient  to  show  the  breach  of  contract  it  was  not 
fatal  to  the  defense  that  the  by-laws  were  not  offered  in  evidence, 
though  they  were  conceded  to  be  a  pai't  of  the  contract. 

Mudge  vs.   Supreme  Court  Independent  Order  of  Odd  Fellows,   Su- 
preme Court  Michigan.  September,  1907,  112  N.  W.  1130. 

The  last  mentioned  case  is  so  recent  and  so  important  that  the 
opinion  is  here  set  out  in  full  in  so  far  as  it  deals  with  warranties 
and  niisrejjresentations :  ' 

"The  ])laiiiliff  in  this  cause  is  a  widow,  and  beneficiary  in  a  fra- 
ternal benefit  certificate.  Her  action  is  brought  to  recover  the 
amount  thereof,  and  is  predicated  upon  the  death  of  her  husband. 

"The  defense  is  reduced  to  one  claim,  viz.,  that  the  deceased  made 
an  intentionally  false  answer,  in  his  medical  examination,  to  the 


THE    STATE    OF    MICHIOAN  471 

question,  'Have  j'ou  ever  had  the  disease  of  insanity?'  Upon  the 
trial  the  learned  circuit  judf^e  was  of  tlic  opinion  that  the  undisputed 
testimony  established  this  defense,  and  he  therefore  directed  a 
verdict  for  the  defendant  and  afterwards  denied  a  motion  for  new 
trial.    The  plaintiff  has  appealed. 

"The  undisputed  testimony  shows  that  the  insured  had  previously 
been  insane,  and  confined  in  the  asyhim  as  insane,  for  three  months, 
upon  an  adjudication  by  the  Probate  Court  that  he  was  insane, 
based  upon  an  application  sworn  to  and  filed  by  this  plaintiff  stating 
that  he  was  insane.  It  also  shows  that  he  had  ilelusions,  and  that 
he  had  attempted  suicide  twice.  It  appeared  with  equal  conclusive- 
ness that  he  knew  that  he  had  been  confined  and  treated  as  insane, 
and  there  was  no  testimony  that  he  stated  these  facts  to  the  agent, 
or  examining  physician  and  was  not  a  party  to  the  insertion  of  the 
false  answer  in  the  application  or  report  of  the  examining  physician. 
On  the  contrary  it  was  shown  that  his  answers  were  faithfully  re- 
corded. There  is  no  occasion  to  allude  to  the  attempted  discrimina- 
tion between  'insanity'  and  the  disease  of  insanity  under  the  facts 
in  this  ease.  Hence,  we  find  that  upon  the  record,  the  judge  was 
warranted  in  saying  that  the  profif  established  the  insured's  insan- 
ity, his  knowledge  and  fraudulent  concealment  of  the  same. 

"There  can  be  no  question  that  this  was  sufficient  to  deprive  his 
iH'iieficiary  of  the  right  to  recover,  unless  the  company  was  estopped 
to  assert  the  claim  by  reason  of  the  alleged  knowledge  of  its  agents, 
or  by  a  waiver. 

"It  is  contended  that  there  was  evidence  tending  to  show  that 
both  the  agent  who  took  the  application,  and  the  physician  who 
made  the  examination,  knew,  at  that  time,  that  the  insured  had  been 
insane,  and  that  his  answers  were  false,  and  that  this  was  the  knowl- 
edge of  the  defendant,  and  is  sufficient  to  estop  it  from  denying  the 
truth  of  the  answer, 

"Were  this  a  case  where  the  insured  had  made  no  misrepresenta- 
tion in  his  answer,  and  was  excusably  ignorant  of  fraudulent  con- 
duct on  the  part  of  the  company's  agent  in  inserting  an  answer  dif- 
ferent from  that  given,  there  might  be  reason  for  this  claim.  In  this 
case  the  most  that  plaintiff's  counsel  could  possibly  contend,  is.  that 
by  collusion   between   the   applicant  and   defendant's   agent,   they 


472  FRATERNAL    SOCIETY    LAW 

made  a  false  answer,  and  now  seek  to  hold  the  company,  by  making: 
a  'sword  instead  of  a  shield'  out  of  the  salutary  rule,  that  the 
knowledge  of  the  agent  is  notice  to  the  principal.  Good  faith  is 
always  essential  to  an  estoppel." 

In  Ins.  Co.  vs.  Gilbert,  27  M.  428,  where  the  insured  answered 
truly,  but  the  agent  inserted  a  false  statement,  with  his  knowledge, 
stating  that  it  was  right,  and  the  insured  signed  honestly  believing 
that  it  was  right;  the  Court  in  reversing  the  judgment,  said: 

"The  very  form  and  obvious  purjiose  of  the  application,  with  the 
consideration  contained  in  it,  showed  that  the  statements  it  con- 
tained were  to  be  understood  as  made  by  the  applicant  and  upon 
his  responsibility  as  the  basis  of  the  contract  of  insurance  he  ex- 
pected to  obtain.  Although  a  person  ignorant  of  the  meaning  of 
special  provisions  used  in  Such  papers,  or  in  the  ])()licy  or  of  the 
sense  attached  to  them  by  the  insurers,  or  of  the  particular  rules  or 
manner  of  doing  business,  has  a  right  to  rel.y  on  the  instructions  and 
assurances  of  the  agent  of  siich  insurers  and  upon  his  acts  in  refet- 
enee  to  such  matters,  in  filling  out  the  application ;  yet  he  cannot, 
therefore,  escape  the  responsibility  for  the  statement  of  facts  which 
he  inserts  himself  in  the  application,  or  permits  the  agent  to  insert, 
as  his.  upon  which  he  is  just  as  well  informed  as  the  agent  himself." 

In  the  case  of  Reed  vs.  Ins.  Co.,  84  M.  532,  the  Court  said  that. 

"If  the  insured  had  no  information  of  the  agent's  misrepresenta- 
tion, the  company  could  not  take  advantage  of  the  wrong  of  its 
agents  and  avoid  the  policy,  but  that  it  would  have  been  otherwise 
had  the  insured  conspired  with  the  agent  or  had  the  insured,  being 
fully  informed  of  the  representation  made  and  the  contents  of  the 
application,  neglected  to  bring  it  to  the  attention  of  the  company." 

In  the  recent  case  of  Kctchaua  vs.  Accident  Association,  117  Mich. 
521,  ilr.  -Tustice  Jloore  said,  with  the  approval  of  the  full  bench, 
that 

"It  is  urged  that  as  the  agent  knew  the  answer's  were  not  true,  his 
knowledge  of  the  comjiany.  and  having  issued  the  policy  the  com- 
pany was  bound.  The  courts  have  always  been  anxious  to  take  care 
of  the  rights  of  the  insured,  when  the  applicant  has  relied  upon  the 
agent's  iiifor'niiiig  the  company  of  what  lias  bi'cn  Irullifully  tdld  to 
him  about  the  cliaracter  of  tile  risk,  liul  thr  courts  never  have  said 


THE    STATE    OF    MICHIGAN  473 

the  compiiiiy  is  bound  1)y  statements  contained  in  an  application 
when  not  only  the  agent  but  the  insured  knows  they  are  untrue 
and  calculated  to  deceive  and  the  application  is  to  be  forwarded  to 
the  company  as  the  basis  of  its  action.  To  so  hold  would  put  these 
organizations  completely  at  the  mercy  of  dishonest  and  unscrupu- 
lous agents." 

In  the  ease  of  Maier  vs.  Asso..  47  U.  S.  Ai)p.  829.  24  C.  C.  A.  243-78 
Fed.  570,  Mr.  Justice  Harlan  used  the  following  vigorous  language : 

"It  was  said  on  the  argument  that  the  company  should  not  be 
permitted  to  take  advantage  of  the  misconduct  or  wrong  of  its  own 
agent,  but  the  law  did  not  prohibit  the  eonipany  from  taking  such 
precautions  as  were  reasonable  and  necessary  to  protect  itself  from 
the  frauds  and  negligence  of  its  agents.  If  the  printed  application 
used  by  it  had  not  informed  the  applicant  that  he  was  to  be  respon- 
sible for  the  truth  of  his  answers  to  questions,  and  if  the  want  of 
truth  in  such  answers  was  wholly  due  to  negligence,  ignorance  or 
fraud  of  the  soliciting  agent,  a  different  question  would  be  pre- 
sented, but  here  the  assured  was  distinctly  notified  by  the  applica- 
tion that  he  was  to  be  held  as  warranting  the  truth  of  his  statements 
'by  whomsoever  written.'.  Such  was  the  contract  betAveen  the  par- 
ties, and  there  is  no  reason  in  law  or  public  policy  why  its  terms 
should  not  be  respected  and  enforced  in  an  action  on  the  written 
contract.  It  is  the  impression  with  some  that  the  courts  may  in 
their  discretion  relieve  parties  from  the  obligations  of  their  contract, 
whenever  it  can  be  seen  that  they  have  acted  heedlessly  or  carelessly 
in  making  them,  but  it  is  too  often  forgotten  that  in  giving  relief 
under  such  circumstances  to  one  party,  the  Court  make  and  enforce 
a  contract  which  the  other  party  did  not  make  or  intend  to  make.  As 
the  assured  stipulated  that  his  statements  which  were  the  foundation 
of  the  application  were  true,  by  whomsoever  such  statements  were 
written,  and  as  the  contract  of  insiu-ance  Avas  consummated  on  that 
basis,  the  Court  cannot  in  an  action  upon  the  contract  disregard  the 
express  agreement  between  the  parties  and  hold  the  company  liable 
if  the  statements  of  the  assured  at  least  touching  matters  material 
to  the  risk  are  found  to  be  imtrue. 

In  Ins.  Co.  vs.  Fletcher,  117  U.  S.  519,  :\lr.  Justice  Field  said: 

"A  curious  result  is  the  outcome  of  the  instruction.    If  the  agents 


^74  FRATERNAL    SOCIETY   LAW 

committed  no  fraud,  the  plaintiff  cannot  recover,  for  the  answers 
reported  are  not  true,  but  if  the}'  did  commit  the  imputed  fraud, 
he  may  recover,  although  upon  the  answers  given,  if  truly  reported, 
no  policy  would  have  been  issued.  Such  anomalous  conclusions 
cannot  be  maintained." 

There  are  many  decisions  elsewhere  which  refuse  to  apply  the  rule 
of  estoppel  in  eases  of  this  kind. 

3  Cooley's  Briefs  in  Ins.  Cases  2569; 
Welsh  vs.  London  Ins.  Corp.,  151  Pa.  607; 
Ins.  Co.  vs.  Fromm,  100  Pa.  347; 
Ins.   Co.  vs.  Smith,  34  C.   C.  A.   506; 
Clemens  vs.  Sup.  Assemb.,  131  N.  Y.  485; 
Boyle  vs.  N.  M.  Ben.,  95  Wis.   312; 
Pros.  Soc.  vs.  Lewellyn,  7  C.  C.  A.  579; 

Mudge  vs.  Supreme  Court  I.  O.  F.,  Supreme  Court  of  Mich.,  Sept., 

1907.   112   N.   W.   1130. 

Society  Not  Responsible  for  Injuries  to  Candidate  Inflicted  Through 
Unwarranted  Acts  of  Local  Lodge  Officials.  ' 

An  applicant  for  membership  agreed  in  his  application  to  be  gov- 
erned by  the  rules  of  the  society,  which  rules  provided  that  the  local 
lodge  is  the  agent  of  the  applicant,  and  that  the  society  should  not 
be  liable  for  any  default  or  negligence  on  the  part  of  the  local  lodge 
or  of  its  officers.  It  was  held  in  such  case  that  the  local  officers 
being  selected  b.v  the  local  lodge  to  perfonn  the  initiatory  ceremony, 
and  the  ritual  described  by  the  society  containing  nothing  suggestive 
that  the  initiation  of  candidates  should  be  conducted  in  such  a  way 
as  to  injure  the  candidate,  the  society  was  not  liable  to  a  candidate 
for  injuries  inflicted  on  him  by  members  of  a  local  lodge  during 
initiatory  ceremonies. 

Kaminslii  vs.  Great  Camp  Knights  of  the  Modern  Maccabees,  Octo- 
l>er,  1906,  146  Mich.  16. 

Exemption  From  General  Insurance  Laws. 

Fraternal  societies  were  held  to  he  entitled  to  exemption  from  the 
provision  of  the  general  insurance  laws  of  the  State  irrespective  of 


THE    STATE    OF    MICHIGAN  4.75 

whether  the  exemption  was  invalid  as  class  jcirislalion  m-  not.  aiul 
that  the  State  alone  was  cntiHiMl  Id  i-aise  thai  f|urstiiMi. 

Monger  vs.  New  Era  Association,  September,  1906,  145  Michigan  683. 

Service  of  Process — How  Made. 

The  laws  of  the  >State  providing'  for  service  on  insurance  com- 
panies in  any  county  in  which  the  plaintiff  resides  and  defendant 
does  business,  was  held  not  to  apply  to  fraternal  societies. 

Monger  vs.  New  Era  Assn.,  September,  1906,  145  Mich.  683. 

Interpleader — Evidence  Under  Same. 

Under  a  bill  of  interpleader  filed  to  determine  the  right  to  the 
proceeds  of  certain  certificates,  testimony  was  held  to  be  admissible 
as  to  the  member's  statement  as  to  his  purpose  in  substituting  his 
sister  in  place  of  his  wife  as  beneficiary  upon  the  issue  of  the  mem- 
ber's mental  capacity,  but  not  for  the  purpose  of  proving  a  gift. 

Great  Camp  Knights  of  the  Modern  Maccabees  vs.  Deen,  and  Modern 
Woodmen  of  America  vs.  Deen,  April,  1906,  143  Mich.  652. 

Funds  After  Payment  Not  Longer  Exempt  From  Creditor's  Claims. 

The  proceeds  of  a  certificate  which  had  been  paid  over  by  the 
society  to  the  beneficiary  and  which  are  on  deposit  in  a  bank  to 
the  beneficiary's  credit,  are  held  not  to  be  exempt  from  the  claims 
of  creditors. 

Recor  vs.  Commercial  and  Savings  Bank.  December,  1905,  142  Mich. 
479. 

Beneficiary — Step-father  Not  a  Member  of  Family  of  Step-daughter. 

A  step-father,  who  was  not  a  memlier  of  his  step-daughter's  house- 
hold at  the  time  of  her  death,  though  at  a  previous  time  he  boarded 
with  her,  was  held  not  to  be  a  member  of  her  family  within  the  terms 
of  the  Illinois  Fraternal  Societv  .statute. 


476 


FRATERl^AL    SOCIETY    LAW 


Supreme  Lodge  Order  of  Mutual  Protection  vs.  Dewey,  January,  1906, 
142  Michigan  666. 

Beneficiary— What  Laws  Determine. 

The  laws  of  a  society  provided  that  the  rights  of  beneficiaries  of 
members  should  be  determined  by  the  laws  in  force  at  the  death  of 
members.  And  the  laws  in  force  at  such  death  provide  that  if  the 
beneficiary  designated  proved  to  be  an  unlawful  one,  the  wife  or 
husband  of  the  member  should  be  recognized  as  the  first  claimant 
for  the  benefit  under  such  circumstances.  A  step-father  who  was 
named  in  the  certificate  as  the  beneficiary  was  held  to  be  not 
entitled  to  the  benefit,  but  that  the  member's  husband  was  entitled 
to  it  even  though  the  society  was  willing  to  pay  the  amount  to  the 
step-father. 

Supreme  Lodge  Order  of  Mutual  Protection  vs.  Dewey,  January,  1906, 
142  Michigan  666. 

Fund  Exempt  From  Claim  for  Alimony. 

The  proceeds  of  a  benefit  certificate  were  held  to  be  exempt  from 
a  claim  for  alimony  and  that  the  Circuit  Court  was  without  jurisdic- 
tion in  a  bill  for  divorce  and  alimony,  to  en.ioin  the  payment  of  the 
proceeds  of  the  certificate  to  the  beneficiary  nanied  therein. 

Hunt  vs.  Branch  Circuit  Judge,  September,  1905,  141  Mich.  423. 

Limitations  as  to  Time  to  Sue — Negotiations  for  Settlement. 

A  society  iiiailc  an  unqualified  denial  of  liaJiility  on  a  benefit  cer- 
tificjite,  but  subsequently  offered  to  pay  a  certain  sum  "for  the  sole 
purpose  of  avoiding  litigation  arid  the  attendant  expense  thereto."' 
The  attorney  for  the  claimant  subsequently  made  efforts  to  induce 
the  soeiet}^  to  pay  more.  Held,  that  such  action  did  not  constitute 
negotiations  which  would  amount  to  a  waiver  of  a  provision  of  the 
contract  that  action  thereon  must  lie  brought  within  three  months 
of  the  time  when  action  occurs. 


Cooper  vs.  Phoenix  Accident  and  Sick  Benefit  Assn.,  September,  1905, 
141  Mich.  478. 


THE    STATE    OF    MICH  WAN  477 

Sick  Benefits — Total  Disability. 

A  sick  boiiefit  contract  provided  for  benefits  to  be  paid  while  the 
member  was  "necessarily  entirely  and  continuously"  confined  to  the 
house.  It  was  hold  that  under  this  contract  there  could  be  no  recov- 
ery for  the  time  during  which  the  member  as  his  physician  testified 
was  not  entirely  confined  to  the  house  I)ut  went  out  of  the  house  for 
exercise  under  his  jjliysieinn's  orders. 

Cooper  vs.  Phoenix  Accident  and  Sick  Benefit  Assn.,  September,  1905, 
141  Michigan  478. 

Suicide  While  Insane. 

The  laws  of  a  society  jn-ovided  that  there  should  be  no  liability 
under  its  contracts  in  ease  members  suicided  unless  it  should  be 
made  to  ajijiear,  to  the  satisfaction  of  the  Executive  Couneil  that  the 
member  was  insane.  Information  came  to  tlie  Executive  Council  that 
a  member  was  insane,  and  it  investigated  this  information,  consid- 
ered same,  and  reached  the  unanimous  opinion  that  the  member  was 
not  insane.  Subsequently  he  suicided.  The  Committee  on  Appeals 
subsequently  considered  the  case  and  disallowed  the  claim,  and  it 
was  held  that  the  beneficiary  was  not  entitled  to  recover. 

Post  vs.  Supreme  Court  Independent  Order  of  Foresters,  December. 
1906,  146  Michigan,  666. 

Beneficiaries — Next  of  Kin. 

The  laws  of  a  society  jirovided  for  several  grades  of  persons  any 
one  or  more  of  whom  might  be  named  as  beneficiary,  the  twelfth 
grade  being  "Persons  next  of  kin  who  would  be  distributees  of  the 
estate  of  such  member  intestate."  It  was  held  that  the  grand 
nephews  and  grand  niece  might  be  designated  as  beneficiary  under 
such  grade  though  there  were  persons  living  belonging  to  preceding 
grades  who  would  take  the  member's  estate  to  the  exclusion  of  the 
beneficiaries  should  the  member  die  intestate. 

Mathewson   vs.   Supreme   Council    Royal   Arcanum.    December,    1906, 
146  Mich.   671. 


478  FRATERNAL    SOCIETY    LAW 

Amendment  of  State  Laws,  Effect  of. 

After  the  issuance  of  a  benelit  certificate,  the  statute  under  which 
the  society  was  organized  was  amended  with  respect  to  the  classes 
of  persons  who  might  be  designated  as  beneficiary,  but  the  statute 
did  not  expressly  require  its  acceptance  by  societies  already  organ- 
ized. It  was  held  that  a  designation  by  a  member  of  a  beneficiary 
from  a  class  added  by  the  amended  statute  was  lawful,  and  that  the 
soeietj'  was  to  be  regarded  as  having  assented  to  the  amended  law 
by  the  issuance  of  said  certificate,  notwithstanding  the  fact  that  the 
society  did  not  amend  or  change  its  own  by-laws. 

Mathewson   vs.   Supreme   Council   Royal   Arcanum,   December,    1906, 
146  Mich.  671. 

Amendment  of  State  Law  Cuts  Off  Rights  Not  Vested — Change  of 
Beneficiary. 

A  certificate  was  issued  payable  to  a  member's  sister  and  contained 
a  clause  limiting  the  member's  right  to  change  the  beneficiary  to 
such  persons  as  the  rules  and  regulations  of  the  society  should  deter- 
mine, and  further  provided  that  the  member  should  comply  with 
the  laws,  rules  and  regulations  which  might  thereafter  be  adopted. 
Amended  laws  were  passed  excluding  .strangers  and  creditors  from 
eligibility  as  beneficiaries.  Under  such  circumstances  it  was  held 
that  the  member  holding  the  certificate  in  question  could  not,  after 
the  amended  law.  substitute  a  creditor  or  stranger  as  beneficiary, 
though  he  might  have  done  .so  prior  to  the  amendment. 

Brinen   vs.    Supreme   Council    Catholic   Mutual    Benefit   Association, 
May.  1905,  140  Michigan  220. 

Local  Lodge  Laws. 

The  laws  of  subordinate  lodges  were  held  Id  lie  part  of  the  eon- 
tract  with  the  iiicmbei-s  and  the  society. 

Kern  vs.  Arbeiter  Vereln,  Feb..  190.5,  139  Mich.  233. 


run  STATE  OF  MICHIGAN  479 

Secession  of  Subordinate  Lodge. 

A  subordinate  lodge  cannot  by  resolution  withdraw  from  the 
society  and  assume  the  payment  of  the  certificates  issued  to  the 
members  of  the  subordiimte  bxliic  by  tln'  society  where  such  action 
impairs  tlie  obliuatioiis  ol'  tlic  coiitiMcts  of  tbc  society  with  its  mem- 
bers. 

Kern  vs.  Arbeiter  Verein,  February,  1905,  139  Mich.  233. 

Warranty,  Breach  of. 

For  the  facts  in  a  case  whei-e  it  was  claimed  that  there  was  a 
breach  of  warranty  arising  n\nni  representation  made  in  the  applica- 
tion that  the  applicant  had  not  consulted  a  physician  within  seven 
years  and  had  never  had  heart  disease,  and  for  the  instructions  of 
the  Court  to  the  .jury  upon  the  question  in  issue  in  such  a  case,  see 

Wilson  vs.  Royal  Neighbors  of  America,  March,  1905,  139  Mich.  423. 

Subordinate  Lodge  Property — Disposition  of  Same. 

A  subordinate  lodge  instructed  one  of  its  members  to  purchase  a 
piece  of  real  estate  in  his  own  name  for  the  benefit  of  the  lodge, 
which  he  did,  taking  a  warranty  deed.  The  lodge  paid  the  purchase 
price  and  exercised  all  acts  of  ownership  over  the  property  but  did 
not  obtain  a  deed  to  itself.  Subserpiently  the  lodge  voted  to  sell  the 
property  to  this  member  upon  certain  terms  with  which  he  com- 
plied; and  the  member  thereafter  contracted  to  sell  the  property, 
and  did  sell  it  to  certain  jiersons  who  were  not  members  of  the  lodge. 
It  was  held  that  inasmuch  as  the  member  had  paid  to  the  lodge  a 
fair  price  for  the  ])ro]HTty  and  the  purchasers  being  bona  fide,  the 
society  on  the  di.ssolntion  of  the  subordinate  lodge  could  not  recover 
the  property  under  the  provisions  of  its  charter,  declaring  that  the 
property  of  subordinate  lodges  should,  upon  the  suspension  of  their 
chai'ter  or  their  dissolution,  revert  to  the  society. 

Grand  Lodge  Independent  Order  of  Odd  Fellows  vs.  Barker,  April, 
1905,  139  Michigan  701. 


^gQ  FRATERNAL    SOCIETY   LAW 

Proceedings  in  Tribunals  of  Society  Not  Conclusive. 

The  eonclusiveness  of  the  judgment  of  the  supreme  tribunal  of 
the  society  as  to  liability  on  a  membership  certificate  may  be  ques- 
tioned in  equity  or  in  law  whenever  such  action  is  set  up  as  a 
defense  to  an  action  to  recover  on  a  certificate. 

Dick  vs.  Supreme  Body  International  Congress,  December,  1904,  138 
Michigan  372. 

Privileged  Communications  Before  Lodge  Trials. 

The  statutes  forbidding  the  disclosure  by  a  physician  of  informa- 
tion acquired  in  attending  a  patient,  was  held  to  apply  as  well  to 
hearings  before  the  tribunals  of  the  society  as  to  proceedings  in 
courts  of  the  State. 

Dick  vs.  Supreme  Body  International  Congress,  December,  1904,  138 
Michigan  372. 

Self  Destruction — Accidental  Poisoning. 

A  contract  provided  for  exemption  from  liability  in  case  the  mem- 
ber died  by  self-destruction  or  suicide.  The  facts  disclose  that  the 
member  took  poison,  not  with  the  intent  to  commit  suicide  but  to 
frighten  his  wife  into  giving  him  money.  It  was  held  that  such 
death  was  not  within  the  terms  of  the  exemption  clause. 

Courtemanche  vs.   Supreme  Court   Independent   Order   of  Foresters, 
March,  1904,  136  Mich.  30. 

Presumptions  as  to  Payments. 

The  delivery  of  a  certificate  which  recites  that  it  is  issued  in  con- 
sideration of  certain  payments  on  the  delivery  thereof,  raises  the 
presumption  that  payments  had  been  made. 

Taylor  vs.  Supreme  Lodge  Columbian  League,  December,  1903,  135 
Michigan   231. 


THE    STATE    OF    MICHIGAN  481 

Delivery  of  Certificate — Waiving  Payments. 

A  certificate  recited  that  it  was  issued  in  consideration  of  the  pay- 
ment of  the  membership  fee  and  assessment  of  $1.44,  all  of  which 
were  due  on  delivery  thereof.  The  agent  remitted  the  membership 
fee,  and  delivered  the  certificate  without  collecting  same,  and  the 
assessments  were  not  paid.  It  was  held  that  the  question  of  pay- 
ment was  for  the  jury  to  decide. 

Taylor  vs.  Supreme  Lodge  Columbian  League,   December,  1903,   135 
Michigan  231. 

Waiver  of  Other  Defenses  by  Asserting  One. 

A  refusal  of  the  officers  of  a  society  to  pay  a  claim  solely  on  the 
ground  that  the  member  had  never  paid  an  assessment,  was  held  to 
constitute  a  waiver  of  other  defenses  known  to  the  officers  at  the 
time. 

Taylor  vs.   Supreme  Lodge  Columbian  League,  December,  1903,  135 
Michigan   231. 

Two  Societies  Alike  Not  Permitted  to  Compete  Under  Peculiar  Facts 
Shown. 

A  society  was  incorporated  in  1891  with  jurisdiction  limited  to 
the  State  of  Michigan,  and  another  society,  similar  in  organization 
and  name,  was  incorporated  in  Michigan  in  1892,  its  jurisdiction 
being  intended  to  embrace  all  parts  of  the  United  States  except  the 
State  of  Michigan  and  certain  other  states  where  like  organizations 
were  already  established.  The  first  mentioned  society  devised  and 
adopted  a  ritual  and  certain  secret  work,  badges  and  paraphernalia 
which  it  subsequently,  in  view  of  advantages  secured  to  its  mem- 
bers, permitted  the  second  mentioned  society  to  use  and  the  work 
and  methods  of  the  two  societies  were  practically  the  same,  both 
having  insurance  features  maintained  upon  the  assessment  plan.  But, 
by  reason  of  the  second  mentioned  society  accumulating  a  reserve 
fund,  the  assessments  levied  and  collected  by  it  were  much  greater 
than  those  collected  by  the  first  mentioned  society.  The  second 
31 


482  FRATERNAL    SOCIETY    LAW 

mentioned  society  had  extended  its  work  over  many  states  at  great 
expense,  wlien  the  first  mentioned  society,  with  a  view  to  the  per- 
petuity of  its  insurance  business,  determined  to  extend  its  opera- 
tions outside  the  State  of  Michigan  and  into  the  territory  of  the 
second  mentioned  society;  and  it  amended  its  articles  of  incorpora- 
tion accordingly.  The  first  mentioned  society  was  held  to  be  es- 
topped from  competing  with  the  second  in  the  territory  occupied  by 
it  by  using  the  same  or  substantially  the  same  ritual,  and  that  an 
injunction  should  be  issued  accordingly. 

Great  Hive  Ladies  of  the  Maccabees  of  Michigan  vs.  Supreme  Hive 
Ladies  of  the  Maccabees  of  the  World,  January,  1904.  135  Michigan 
392. 

Privileged  Communications. 

A  statute  of  Michigan  provides  that  when  a  suit  is  prosecuted  or 
defended  by  the  heirs,  assignees,  devisees,  legatees  or  personal  rep- 
resentatives of  tlie  deceased  member,  the  opposite  party  if  examined 
as  a  witness  on  his  own  behalf  shall  not  be  allowed  to  testify  to  mat- 
ters which,  if  true,  must  have  been  equally  within  the  knowledge  of 
the  deceased,  and  this  knowledge  was  held  to  apply  to  a  contest 
between  two  beneficiaries  under  separate  designations  of  a  deceased 
member  of  a  beneficiary  society,  each  of  whom  claimed  to  be  en- 
titled to  the  fund. 

Great  Camp  Knights  of  the  Maccabees  vs.  Savage,  January,  1904, 
135  Michigan  459. 

Trial  Tribunals  in  Societies  Lawful. 

The  laws  of  a  society  creating  a  trilnuial  of  its  members  to  hear 
and  determine  all  claims  of  members  against  it.  declaring  that  the 
decisions  of  such  tribunal  shall  be  final  are  lu^ld  to  be  valid,  and  to 
form  a  part  of  the  contract  of  membership  between  the  members  and 
the  society. 

Derry  vs.  Great  Hive  Ladies  of  the  Modern  Maccabees,  January, 
1904,  135  Michigan  494. 


THE    STATE    OF    MICHIGAN  483 

Acquiescence  by  Member  in  Ruling  of  Society. 

As  to  facts  showing  acquieseenco  by  a  mcinlicr  in  an  adverse  de- 
cision against  his  claim,  wliioli  decision  was  iiiade  by  a  ooniniittpe  of 
the  society,  see 

Derry   vs.   Great   Hive    Ladies   of   tlie   Modern   Maccabees,    .ianuary, 
1904.  135  Micliigan  494. 

Tribunals  of  Society  Not  Bound  by  Technicalities. 

When'  a  controversy  is  submitted  to  a  tribunal  of  the  society,  the 
tribunal  may  be  expected  to  act  more  freely  and  less  technically  than 
courts  and  juries,  and  the  only  rule  for  the  admission  or  exclusion 
of  testimony  is  that  of  common  fairness,  where  the  parties  in  such 
a  case  had  produced  before  the  supreme  tribunal  under  the  lailes  of 
practice,  their  testimony,  and  a  legal  and  fair  hearing  had  been 
granted,  and  an  adverse  decision  was  found,  its  validity  could  not 
be  affected  by  the  fact  that  one  of  the  parties  was  not  afforded  an 
opportunity  to  be  present  when  the  tinal  determination  was  made. 

Barker  vs.   Great  Hive   Ladies  of  the  Modern  Maccabees,   Supreme 
Court  of  Michigan.  January,  1904,  135  Mich.  499. 

Resort  to  Civil  Courts. 

The  laws  of  a  society  provided  for  arbitration  of  death  claims, 
and  that  the  decision  of  the  arbitrating  body  should  be  tinal.  It  was 
held  that  no  suit  in  the  courts  could  be  maintained  until  the  remedies 
provided  for  by  the  laws  had  been  exhausted. 

Hoag    vs.    Suyreme   Lodge    International    Congress,    July,    1903,    134 
Mich.  87. 

Forfeiture — Retention  of  Payments. 

The  acceptance  of  a  ])ast  tine  assessment  and  its  retention  until 
after  the  eommeuceinent  of  suit,  was  held  to  constitute  a,  waiver  of 
the  right  to  assert  forfeiture. 


484  FRATERNAL    SOCIETY    LAW 

Lord  vs.  National  Protective  Society,  September,  1903,  134  Michigan 
357. 

Right  of  Beneficiary  to  Contest  Change. 

A  beiieficiaiy  in  a  certificate  was  held  to  have  such  an  interest 
therein  as  to  enable  him  to  contest  the  validity  of  the  latter 's  action 
in  surrendering  the  certificate  and  procuring  a  new  one  in  favor  of 
a  different  beneficiary  on  the  ground  that  the  member  was  mentally 
incompetent  to  bring  about  such  a  result ;  and  it  was  held  that  if  such 
claim  could  be  established  the  original  certificate  would  be  held  to 
have  remained  in  force. 

Grand  Lodge  A.  0.  U.  W.  vs.  Franlc,  May,  1903,  133  Micli.  232. 

Beneficiaries  Have  No  Vested  Interests. 

The  fact  that  the  beneficiary  named  in  the  certificate  is  in  posses- 
sion thereof,  and  has  paid  the  assessments  and  dues  thereon,  is  held 
not  to  entitle  her  to  object  to  the  designation  of  a  new  beneficiary  by 
the  member  pursuant  to  the  law  authorizing  him  to  change  his  bene- 
ficiary at  will. 

Grand  Lodge  A.  O.  U.  W.  vs.  McGratli,  June,  1903,   133  Mich.   626. 

Beneficiary  Has  Right  to  Contest  Change  Where  Mental  Capacity  of 
Member  in  Question. 

A  beneficiary  in  a  certificate  has  such  an  interest  therein  as  to 
enable  lier  to  contest  the  mental  ca])a('ity  oi  the  member  to  designate 
a  new  beneficiary. 

Grand  Lodge  A.  O.  U.  W.  vs.  McGrath,  June,  1903,   133   Mich.   626. 

Beneficiary — Widow  De  Facto. 

The  laws  of  the  soeiet.\'  jirovided  tliat  certificates  sluMilil  be  jiaid 
to  the  wife,  husband,  children,  dependent  mothei".  etc..  of  the  mem- 
ber. A  man  and  a  woman  lived  toj^cther  ns  husl)and  and  wife  in 
good  faith  under  a  mistaken   liclicl  that   \\\v  wonuin  was  divorced 


THE    l?TATE    OF    MICHIGAN  485 

from  her  former  husband,  and  sho  \v;is  designated  as  the  beneficiary 
of  the  member  with  whom  she  was  so  living.  Held,  that  under  these 
facts  she  was  entitled  to  take  the  benefit  as  against  the  mother  of  the 
mciiihcr  who.  with  full  knowledge  of  all  the  facts,  had  for  eighteen 
years,  li'eatctl  thciii  as  husband  and  wife. 

Supreme  Tent  Knights  ol'  the  Maccabees  of  the  World  vs.  McAllister, 
December,  1902,  132  Mich.  69. 

Beneficiaries — Public  Policy. 

It  is  not  against  public  policy  to  permit  societies  to  issue  certifi- 
cates to  a  member  payable  to  a  woman  living  with  the  member  in 
the  honest  belief  of  both  that  they  were  husband  and  wife,  although 
one  of  them  may  have  been  married  but  not  legally  divorced. 

Supreme  Tent  Knights  of  the  Maccabees  of  the  World  vs.  McAllister, 
December,  1902,  132  Mich.  69. 

Beneficiary — Change  of  Same. 

The  laws  of  a  society  provided  that  the  beneficiary  may  be  changed 
upon  the  surrender  of  the  certificate,  the  beneficiary  having  pos- 
session of  the  certificate  refused  to  surrender  it,  and  at  the  request 
of  the  member  the  society  issued  a  new  certificate  jDayable  to  a 
different  beneficiary.  Held,  that  the  beneficiary  named  in  the  first 
certificate  could  not  recover  on  same. 

Allgemeiner  Arbeiter  Bund  vs.  Adamson,  December,  1902,  132  Mich- 
igan 86. 

Assent  of  Member  to  Change  in  Laws. 

The  assent  of  a  member  of  a  society  to  a  change  in  its  laws,  where- 
by certain  benefits  are  increased  and  others  diminished  was  said  to 
be  not  without  consideration  and  hence  need  not  be  in  writing  or 
evidenced  by  any  express  agreement. 

Pokrefky  vs.  Detroit  Fireman's  Fund  Assn.,  June,  1902,  131  Mich.  38. 


^gg  FRATERNAL    SOCIETY    LAW 

Receivers — Liability  of. 

A  receiver  of  a  fraternal  society  will  be  charged  with  assessments 
lost  tbroiagh  his  want  of  diligence  in  learning  of  the  deaths  of  debt- 
ors and  presenting  claims  against  their  estates. 

In  re  Angell,  September,  1902,  131  Mich.  345. 

Payments  Made  in  Good  Faith  on  Unlawful  Contracts. 

Where  money  has  been  paid  under  certificates  which  have  fully 
matured,  such  payments  will  not  be  set  aside  in  a  suit  by  a  receiver 
of  a  society  asking  relief  on  the  ground  that  the  scheme  of  the  society 
was  impracticable  and  illegal  and  that  all  moneys  collected  from  the 
members  shovxld  constitute  a  trust  fund  to  be  dishtributed  pro  rata 
among  themselves. 

Calkins  vs.  Green,  March,  1902,  130  Mich.  57. 

Laws  Respecting  Change  of  Beneficiary  May  Be  Waived. 

Restrictions  in  the  laws  of  a  society  as  to  the  method  of  changing 
beneficiary  are  matters  of  contract  between  the  society  and  members 
and  the  change  made  otherwise  by  the  member,  assented  to  by  the 
society  during  the  member's  lifetime,  was  held  to  contain  no  ground 
for  complaint  by  the  beneficiary. 

Supreme   Court   Order   of   Patricians   vs.    Davis,    January,   1902,   129 
-Michigan  318. 

Certificate — Delivery  of. 

Delivery  of  a  benefit  certificate  to  an  officer  of  the  society  in  his 
individual  capacity  as  custodian  for  the  member  was  held  to  be  de- 
livery to  the  member. 

Supreme   Court   Order   of   Patricians    vs.    Davis,    January,   1902,   129 
Michigan  318. 


THE    STATE    OF    MICHIGAN  48T 

Forfeiture — Payments  Accruing  Dxiring  Disability. 

A  member's  certificate  cannot  be  forfeited  for  the  non-payment  of 
an  assessment  falling  due  during  the  period  of  disability  for  which 
disability  he  is  entitled  to  a  benefit  amounting  in  excess  of  the  as- 
sessment due. 

Albrecht  vs.  People's  Life  and  Annuity  Assn.,  February,  1902,  129 
Mich.  444. 

Suit  by  One  Society  Versus  Another  in  Voting  Right  to  Use  Ritual, 
Etc. 

For  an  interesting  di.scussion  of  the  character  of  pleadings  and 
relief  sought  under  same  where  a  bill  is  filed  by  one  society  against 
another,  see  the  following: 

Great  Hive  Ladles  of  the  Maccabees  for  Michigan  vs.  Supreme  Hive 
Ladies  of  the  Maccabees  of  the  World,  January,  1902,  129  Mich.  324. 

Funds  of  Local  Lodge  Not  Property  of  Society. 

Where  under  the  laws  of  the  society  a  sick  benefit  fund  accumu- 
lated by  a  subordinate  lodge  is  the  property  of  the  subordinate  lodge 
a  receiver  of  the  parent  body  is  not  entitled  thereto  as  against  an- 
other society  to  which  the  fund  has  been  transferred  by  the  local 
lodge. 

Detroit  Savings  Bank  vs.   Haines,  July,  1901,   128  Mich.   38. 

Denial  of  Liability  Waives  Proofs  of  Loss. 

Upon  the  society  denying  liability  the  beneficiary  is  relieved  of 
the  necessity  of  filing  proofs  of  claim. 

Hoffman  vs.  Michigan  Home  and  Hospital  Assn.,  Oct.  1901,  128  Mich. 
322. 

Conditions  Precedent  Waived. 
A  provision  of  the  laws  of  the  society  making  the  initiation  of  an 


^gg  FRATERNAL    SOCIETY    LAW 

applicant  a  condition  precedent  to  the  issviance  of  the  certificate  is 
■waived  by  the  issuance  of  the  certificate  without  having  required  the 
performance  of  such  condition. 

-■^Witii 

Wagner  vs.  Supreme  Lodge  Knights  and  Ladies  of  Honor,  November, 
1901,  128  Mich.  660. 

Tenders  Refused  Need  Not  be  Repeated. 

When  a  society  has  refused  to  receive  assessments  on  the  ground 
that  the  person  tendering  same  is  not  a  member,  it  cannot  defeat  a 
claim  for  benefits  because  of  the  failure  to  tender  subsequent  pay- 
ments. 

Wligner  vs.  Supreme  Lodge  Knights  and  Ladies  of  Honor,  November, 
1901,  128  Mich.  660. 

Agency  of  Local  Lodge. 

"Where  the  laws  authorized  a  local  lodge  to  receive  assessments, 
the  neglect  of  such  local  lodge  to  forward  same  to  the  society  will 
not  defeat  the  rights  of  the  member,  notwithstanding  another  by-law 
declared  such  local  lodge  to  be  the  agent  of  the  member  and  not  of 
the  society. 

Wagner  vs.  Supreme  Lodge  Knights  and  Ladies  of  Honor,  Novembe'", 
1901,  128  Mich.  660. 

Delivery  of  Certificate  to  Local  Lodge. 

Where  a  certificate  is  issued  by  a  society  and  sent  to  a  subordinate 
lodge  for  delivery  to  a  member,  the  contract  is  complete,  though  the 
certificate  is  not  actuallj'  delivered. 

Wagner  vs.  Supreme  Lodge  Knights  and  Ladles  of  Honor,  November, 
1901,  128  Mich.  660. 

Right  of  Society  to  Prescribe  Qualifications  for  Membership. 

Where  the  statute  authorized  a  society  to  make  and  establish  rules 


THE    STATE    OF    MICHIGAN  489 

and  rciiiiliitious  for  governing  the  affairs  and  business  of  the  society 
atid  its  members,  not  inconsistent  to  the  laws  of  the  United  States 
or  of  tlic  particular  State  of  the  society's  incorporation,  and  to  decide 
as  to  the  necessary  qualifications  for  membership,  a  by-law  of  such 
a  society  prohibiting  members  from  belonging  to  any  society  not 
a|i|ir(i\('d  by  the  Roman  Catholic  Church  is  valid  and  a  violation 
tluTcdf  is  held  to  jiistify  the  mrmber's  expulsion. 

Mazurkiewicz  vs.  St.  Adelbertus  Aid  Society,  June,  1901,  127  Mich. 
145. 

Payments  Made  on  Ultra  Vires  Contracts. 

Where  a  society  issued  certificates  payable  at  the  expiration  of  a 
fixed  jieriod  in  the  nature  of  entlowiueut  insurance,  which  it  was  not 
authorized  to  do  by  the  act  under  which  it  was  organized,  and  when 
such  society  went  into  the  hand.s  of  a  receiver,  one  who  received 
money  from  it  for  distribution  among  the  holder.s  of  matured  certifi- 
cates and  who  distributed  same  accordingly,  without  knowledge  of 
the  insolvency  of  the  society,  was  held  not  liable  to  the  receiver  for 
the  money  so  distributed  on  the  theory  that  he  participated  in  the  di- 
version of  a  trust  fund. 

Calkins  vs.  Beekman,  July,  1901,  127  Mich.  249. 

^      Forfeiture — Custom  to  Receive  Late  Payments. 

Evidence  that  a  member  of  a  society  entertained  a  belief  that  the 
courts  wouU  not  sustain  a  forfeiture  of  his  certificate  for  failure  to 
pay  an  assessment  within  the  time  required  by  the  laws  of  the 
society  has  no  tendency  to  show  that  in  delaying  such  payment  he 
did  not  rely  upon  the  custom  of  the  society  in  receiving  such  pay- 
ments after  the  time  when  they  were  due. 

Wallace  vs.  Fraternal  Mystic  Circle.  July,  1901,  127  Mich.  287. 

,    Forfeitures — Fact  Cases. 

For  the  facts  in  a  case  where  it  was  claimed  on  the  part  of  the 


490 


FRATERNAL    SOCIETY    LAW 


society  that  the  member  had  forfeited  his  certificate  by  reason  of 
failure  to  make  payments,  and  where  such  forfeiture  was  not  upheld 
by  the  Court,  see 

Wallace  vs.  Fraternal  Mystic  Circle,  July,  1901,  127  Mich.  287. 

Beneficiary— Trustee  May  Be  Designated. 

A  ti-ustee  may  be  designated  as  beneficiary  to  act  for  persons  who 
otherwise  would  be  competent  to  take  if  named  directly. 

Grand  Lodge  A.  0.  U.  W.  vs.  Fisk,  April,  1901,  126  Micli.  356. 

r 

Resort  to  Civil  Courts. 

"Where  the  beneficiary  of  a  member  is  denied  the  remedy  by  appeal 
provided  for  by  the  society's  laws,  such  beneficiary  may  maintain 
i.  suit  at  law  notwithstanding  the  provisions  of  the  by-laws  of  the 
Society  to  the  contrary. 

Rose  vs.  Supreme  Court  Order  of  Patricians,  May,  1901,  126  Mich.  577. 

Restrictions  on  Member's  Conduct. 

Where  the  members  of  a  sick  benefit  society  were  organized  among 
the  members  of  a  particular  church,  and  were  required  by  the  laws 
of  the  Society  not  to  belong  to  any  other  sick  benefit  society,  and 
were  also  required  to  care  for  their  own  sick  members,  it  was  held 
not  to  be  unreasonable  nor  against  public  policy  to  so  restrict  mem- 
bership, since  in  the  absence  of  such  restriction,  a  member  might 
join  so  many  societies  of  a  similar  nature  as  to  be  unable  to  perform 
the  duties  he  owed  this  society. 

Bretzlaff  vs.  Evangelical  Lutheran  Sick  Benefit  Society,  October,  1900, 
125  Mich.  39. 

Beneficiary^Appointment  of  Trustee. 

A  member  of  the  A.  0.  U.  W.  carried  a  eortificnte  which  after  the 
death  of  the  beneficiaries  named  therein,  who  were  his  wife  and 


THE    STATE    OF    MICHIOAN  491 

daughter,  desired  to  nuike  C,  his  son-in-law,  his  beneficiary.  Tliis 
was  prohibited  hy  the  laws  of  the  society.  The  member  thereupon 
made  his  niece  his  beneficiary  with  a  written  ;mi'cciiieiit  signed  by 
her  that  upon  receipt  of  the  fund  she  W(uiid  pas  it  over  to  ("..  the 
son-in-law.  The  society  issued  its  check  to  tlic  niece  witii  foil  knowl- 
edge of  the  trust  upon  which  she  had  agreed  to  receive  it.  Upon 
receipt  of  the  cheek,  the  uieee  refused  to  transfer  it  to  C.  or  to  pay 
him  the  money.  Held,  that  she  was  bound  to  carry  out  the  trust  and 
that  the  society  was  the  only  i)arty  in  a  position  to  contest  the  lesnl- 
ity  of  the  transaction. 

Cowin  vs.  Hurst,  July,  1900,  124  Mich.  545. 

Payments — Receiver  May  Enforce  Collection  of  Assessments. 

A  member  of  a  society  is  obligated  to  make  all  payments  required 
under  his  certificate  and  a  receiver  of  an  insolvent  socii'ty  has  the 
right  to  enforce  collection  of  an  assessment  levied  by  him  under  the 
authority  of  law  to  collect  assessments  which  are  made  for  the  pur- 
pose of  meeting  the  liabilities  accruing  before  his  appointment. 

Calkins  vs.  Angell,  Feb.,  1900,  123  Mich.  77. 

Conflict  in  Laws  of  Society. 

"Where  there  is  a  conflict  between  the  articles  of  association  and 
the  by-laws  of  a  society,  the  articles  of  association  will  govern. 

Sheldon  vs.   National   Masonic  Accident  Assn.,   December,   1899,  122 
Mich.  403. 

Proofs  of  Death,  Delays  Due  to  Society. 

A  society  cannot  take  advantage  of  the  delay  in  furnishing  proofs 
of  loss  occasioned  by  its  own  neglect  in  supplying  blanks  after  re- 
quest for  same. 

Sheldon  vs.   National  Masonic  Accident  Assn.,  December,   1899,  122 
Mich.  403. 


492  FRATERNAL    SOCIETY    LAW 

Resort  to  Civil  Courts. 

A  finding  by  the  tribunals  of  a  society  that  a  member  was  not  en- 
titled to  sick  benefits  cannot  be  rendered  conclusive  so  as  to  preclude 
resort  to  the  courts  by  a  mere  reference  to  the  custom  of  the  society 
where  there  is  nothing  in  the  constitution  or  laws  which  so  provide. 

Wuerthner   vs.    Workingmen's    Benevolent    Society,    July.    1899,   121 
Mich.  90. 

Agency  of  Local  Lodge,  Waiver  of  Laws  by. 

Where  local  lodges  are  required  to  collect  assessments,  the  laws 
of  the  society  giving  them  full  power  in  respect  thereto,  including 
the  right  to  reinstate  members  without  notice  to  the  society,  an 
action  for  death  benefits  cannot  be  defeated  where  it  appears  that 
the  lodge  had  induced  its  members  to  believe,  through  a  long  con- 
tinued practice  of  receiving  assessments  after  due  without  declaring 
a  forfeiture,  that  such  payments  would  be  received  after  the  same 
were  due. 

Wallace  vs.  Fraternal  Mystic  Circle,  September,  1899,  121  Mich.  263. 

Constitutional  Law,  Title  to  Statute. 

For  a  discussion  of  the  title  to  a  fraternal  beneficiary  statute 
which  was  claimed  to  embrace  more  than  one  subject,  see  the  fol- 
lowing : 

McMorran  vs.  Great  Hive  Ladies  of  the  Maccabees,  June,  1898,  117 
Mich.  398. 

u      Forfeitures,  Waivers  of. 

One  whose  certificate  has  been  cancelled  for  non-payment  of  an 
assessment  of  which  he  received  no  valid  notice,  where  notice  is 
required,  does  not  waive  the  defects  in  the  notice  by  subsequently 
offering  tn  pay  llic  assessments  wlieu  at  the  sinne  tinic  he  insists  that 
be  was  not  in  default. 


THE     tiTATi:    Of    MICUIOAN  493 

Dowling    vs.    Knights    Templars    and    Masons'    Life    Indemnity    Co., 
March,  189S,  116  Mich.  471. 

Resort  to  Civil  Courts. 

The  laws  of  the  society,  referred  to  in  the  certificate  and  made  a 
part  tliereof,  provide  for  arbitration  of  disjnited  claims,  and  that  the 
award  shall  be  final;  but  that  no  award  shall  be  valid  unless  signed 
by  all  the  arbitrators,  in  which  case  each  member  shall  have  a  right 
to  a  new  arbitration,  and  providing  that  no  suit  in  law  or  in  equity 
sliall  be  commenced  or  maintained  by  any  member  against  the 
society  until  all  remedies  provided  for  in  the  society  have  been 
exhausted,  will  not  be  declared  inoperative  on  the  ground  that  they 
are  unreasonable  and  oppressive. 

Russell  vs.  North  American  Benefit  Association,  May,  1898,  116  Mich. 
699. 

Society  Not  a  Partnership  in  Any  Sense. 

A  benevolent  and  social  organization  having  in  view^  the  pro- 
tection, benefit  and  welfare  of  its  members'  in  their  employments, 
is  in  no  sense  a  partnership.  For  a  discussion  of  this  doctrine  and 
for  elaborate  notes  and  authorities,  see 

Brown  vs.   Stoerkel,  Supreme  Court  of  Mich.,  February,   1889,   3  L. 
R.  A.  430. 


4-94  FRATERNAL    SOCIETY   LAW 


THE 

STATE  OF  MINNESOTA. 


CHAPTER  24. 

(The  Section  numbers  employed  correspond  to  those  in  the  1907 
Edition  of  the  Insurance  Laws  of  Minnesota  as  issued  by  the  In- 
surance Department.) 

Beneficial  and  Fraternal  Associations. 

Section  1U8.  Any  bcueficiarj-  or  fraternal  association,  as  defined 
in  this  chapter,  may  make  provisions  for  the  payment  of  benefits 
in  case  of  sickness  or  temporary  or  permanent  physical  disability, 
as  a  result  of  disease,  accident,  or  age  exceeding  seventy  years,  and 
may  also  provide  for  the  payment  of  funeral  expenses  of  a  member 
not  exceeding  .$75 :  in  any  case  all  of  said  benefits  to  be  paid  subject 
to  compliance  by  its  members  with  its  constitution  and  by-laws, 
out  of  funds  derived  from  assessments  and  dues  collected  from  its 
members.  Payments  of  death  benefits  shall  be  made  only  to  the 
families,  heirs,  blood  relatives,  adopted  children,  fiancee  of  the  mem- 
ber, or  persons  dependent  upon  him,  or  whenever  his  certificate  of 
membership  may  so  provide,  the  executor  or  administrator  of  the 
estate  of  the  member  in  tmist  for  such  person  or  persons  above 
mentioned  as  may  be  designated  in  such  certificate.  Any  member 
wlu)  by  reason  of  old  age  or  other  disability  is  dependent  for  his 
support  in  whole  or  in  part  upon  another,  whether  such  other  stands 
in  the  above  relationship  to  him  or  not,  may  with  the  consent  of  and 
under  such  regulations  as  the  association  may  prescribe,  designate 
siicli  [lerson  ii])(in  whom  he  is  so  deiieudent  as  a  beneficiary  under 


THE    STATE    OF    MINNESOTA  495 

his  said  certificate,  and  in  such  case  the  deatli  lienefits  shall  be  paid 
according  to  such  designation.  Every  such  association  may  create 
and  maintain  a  reserve  fund  for  such  purpose  and  shall  be  held  to 
an  institution  of  public  charity,  and  shall  be  exempt  from  payment 
of  taxes  for  State,  county  or  municipal  purposes,  except  that  the  real 
estate  of  such  association  shall  be  taxed  as  other  real  estate  in  the 
State  of  Minnesota.    (R.  L.  '05  s.  1703,  as  amended  by  '07  c.  382.) 

"Fraternal  Beneficiary  Association"  Defined. 

Section  109.  Any  corporation,  society,  order  or  voluntai'y  asso- 
ciation, without  capital  stock,  organized  and  carried  on  solely  for 
the  mutual  benefit  of  its  members  and  their  beneficiaries,  and  not  for 
profit,  and  having  a  lodge  system  v^ith  ritualistic  form  of  work  and 
representative  form  of  government  and  which  shall  make  provision 
for  the  payment  of  death  or  disability  benefits,  or  both,  is  hereby 
declared  to  be  a  fraternal  beneficiary  association.     ('07  c.  345  s.  1.) 

"Lodge  System"  Defined. 

Section  110.  Any  association  having  a  supreme  governing  or 
legislative  body  and  subordinate  lodges  or  branches  by  Avhatever 
name  known  into  which  members  shall  be  elected,  initiated  and  ad- 
mitted in  accordance  with  its  constitution,  laws,  rules,  regulations, 
and  prescribed  ritualistic  ceremonies,  which  subordinate  lodges  or 
branches  shall  be  required  by  such  association  to  hold  regular  or 
stated  meetings  at  least  once  in  each  month,  shall  be  deemed  to  be 
operating  under  the  lodge  system.    ('07  c.  345  s.  2.) 

"Representative  Form  of  Government"  Defined. 

Section  111.  Any  association  shall  be  deemed  to  have  a  repre- 
sentative form  of  government,  when  it  shall  provide  in  its  constitu- 
tion and  laws  for  a  supreme  legislative  or  governing  body,  com- 
posed of  representatives  elected  either  by  the  members  or  by  dele- 
gates elected  by  the  members  through  a  delegate  convention  sj^stem, 
together  with  such  other  members  as  may  be  prescribed  by  its  con- 
stitution and  laws,  provided  that  the  elective  representatives  shall 


496  FRATERNAL   SOCIETY   LAW 

constitute  a  majority  in  number  and  have  not  less  than  a  majority 
of  the  votes,  nor  less  than  the  votes  required  to  amend  its  constitu- 
tion and  laws,  and  provided  further,  that  the  meetings  of  the 
supreme  or  governing  body  and  the  election  of  officers,  representa- 
tives or  delegates  shall  be  held  as  often  as  once  in  four  years.  The 
members,  officers,  representatives  or  delegates  of  a  fraternal  bene- 
ficiary society  shall  not  vote  by  proxy.     ( '07  c.  345  s.  3.) 

Scope  of  Act — Exemption  From  Insurance  Laws. 

Section  112.  Except  as  herein  provided,  such  association  shall 
be  governed  by  this  act  and  shall  be  exempt  from  all  provisions  of 
the  insurance  laws  of  this  State  not  only  in  governmental  relations 
with  the  State,  but  for  every  other  purpose,  and  no  law  hereafter 
passed  shall  apply  to  them,  unless  they  be  expressly  designated 
therein.     ('07  c.  345  s.  4.) 

Kinds  of  Benefits  Which  May  or  Shall  be  Paid. 

Section  113.  Every  association  transacting  business  under  this 
act  shall  provide  for  the  payment  of  death  or  disability  benefits,  or 
both,  and  may  provide  for  the  payment  of  benefits  in  case  of  tem- 
porary or  permanent  physical  disability,  either  as  the  result  of 
disease,  accident  or  old  age,  provided,  the  period  of  life  at  which 
the  payment  of  benefits  for  disability  on  account  of  old  age  shall 
commence  shall  not  be  under  seventy  years.    ( '07  c.  345  s.  5.) 

Who  May  be  Beneficiaries. 

Section  114.  The  payment  of  death  benefits  shall  be  confined  to 
the  wife,  husband,  family,  relatives  by  blood,  marriage  or  legal 
adoption,  affianced  husband  or  affianced  wife,  or  to  a  person  or  per- 
sons dependent  on  the  member,  subject  to  the  limitation  and  control 
of  the  association  as  to  the  designation  of  beneficiaries  within  said 
clas-ses.     ('07  c.  345  s.  6.) 

Persons  Disqualified  for  Beneficial  Membership. 

Section  115.     No  association  shall  admit  to  beneficial  membership 


THE    STATE    OF    MI.WEl^OTA  497 

any  ])(>rson  less  tliaii  sixteen  (16)  iior  more  than  sixty  (60)  years 
of  iiK'e.  nor  any  jierson  who  has  not  been  examined  by  a  legally 
(|iKilifie(l  jiraetieinK  |)hysician  and  whose  examination  has  not  been 
a[ipfiiv<-(l  liy  tlic  supervisiny'  ini'dical  autiiority  of  the  association  as 
pKovided  by  the  laws  of  the  association  ;  jirovided  that  such  examina- 
tion shall  not  be  required  of  associations  paying  only  accident  or  sick 
benefits,  or  funeral  benefits  not  exceeding  .+300.     ('07  c.  345  s.  7.) 

Certificates,  What  to  Contain — Evidence — Amendments  to  Charter, 
Etc.,  Effect. 

Section  116.  Every  certificate  issued  by  any  association  shall 
specify  the  maximum  amount  of  benefit  provided  by  the  contract 
and  shall  provide  that  the  certificate,  the  constitution  and  laws  of  the 
association  and  the  application  for  membership  and  medical  exam- 
ination, signed  by  the  applicant,  shall  constitute  the  contract  between 
the  association  and  the  member  and  copies  of  the  same  certified  by 
the  secretary  of  the  association  or  corresponding  officer  shall  be  re- 
ceived in  evidence  of  the  terms  and  conditions  of  the  contract;  and 
any  changes,  additions  or  amendments  to  said  charter  or  articles 
of  a.s.sociation,  constitution  or  laws  duly  made  or  enacted  subsequent 
to  the  issuance  of  the  benefit  certificate  shall  bind  the  member  and 
his  beneficiaries  and  shall  govern  and  control  the  contract  in  all 
respects  the  same  as  though  such  changes,  additions  or  amendments 
had  been  made  prior  to  and  were  in  force  at  the  time  of  the  applica- 
tion for  membership.  Provided,  that  any  association  hereafter  or- 
ganized or  admitted  to  do  business  in  this  State  shall  in  its  certificate 
specify  a  fixed  mininuim  amount  of  benefit.     ('07  c.  345  s.  8.) 

Revenue  Fund — Benefits  and  Expenses,  How  Paid — Extra  Assess- 
ments. 

Section  117.  Any  association  may  create,  maintain,  invest,  dis- 
burse and  apply  a  reserve,  emergency,  surplus  or  other  fund  in  ac- 
cordance with  its  constitution  and  laws  for  the  purposes  specified  in 
section  5  (113  of  this  code),  of  this  act.  Any  such  association  so 
creating,  maintaining,  investing,  disbursing,  or  applying  any  such 
reserve,  emergency,  or  surplus  fund,  shall  not  be  held  to  be  organized 
32 


498  FRATERNAL    SOCIETY   LAW 

or  carried  on  for  profit  witliiu  tlie  intent  of  tlie  provisions  of  section 
1  (109  of  this  code)  of  this  act.  Such  funds  shall  be  held,  invested 
and  disbursed  for  the  use  and  benefits  of  the  association,  and  no 
member  or  beneficiary  shall  have  or  acquire  any  individual  rights 
therein,  or  be  entitled  to  an  apportionment  or  the  surrender  of  any 
part  thereof.  The  funds  from  which  benefits  shall  be  paid  and  the 
funds  from  which  the  expenses  of  the  association  shall  be  defrayed, 
shall  be  derived  from  periodical  or  other  payments  by  the  members 
of  the  association  and  accretions  of  said  funds ;  and  every  such  asso- 
ciation shall  provide  in  its  constitution  or  laws  that  if  such  regular 
payments  are  insufficient  to  pay  all  matured  death  and  disability 
claims  in  full  and  to  provide  for  the  creation  and  maintenance  of  the 
funds  i-equired  by  its  constitution  and  laws,  extra  assessments,  or 
other  payments,  may  be  levied  upon  the  members  to  meet  such  de- 
ficiency.    ( '07  c.  345  s.  9.) 

Real  Estate  Holdings — Investments. 

Section  118.  Any  association  may  invest  its  funds  in  aiul  hold 
real  estate  for  lodge  and  office  purposes,  and  any  real  estate  acquired 
by  foreclosure  or  received  in  satisfaction  of  loans,  and  may  sell  and 
convey  the  same.  Any  such  association  may  also  invest  its  funds 
in  government,  State,  provincial,  county  or  municipal  bonds,  or 
bonds  of  any  township,  park  or  school  district  having  taxing  powers, 
provided  that  such  bunds  shall  be  a  direct  obligation  on  all  the 
taxable  property  within  such  municipality  or  district  and  the  net  in- 
debtedness of  such  municipality  or  district  shall  not  exceed  five  (5) 
per  centum  of  the  value  of  all  taxable  pi'operty  therein,  according 
to  the  last  valuation  for  taxation  preceding  the  issuance  of  said 
bonds ;  or  in  first  mortgages  or  first  mortgage  bonds  upon  improved 
real  estate  for  not  exceeding  fifty  (50)  per  centum  of  the  actual  cash 
value  thereof  at  the  time  of  making  the  loan ;  provided,  however, 
that  every  foreign  association  shall  be  empowered  to  invest  its  fnnds 
in  such  securities  as  may  be  permitted  by  the  laws  of  the  State, 
province  oi-  country  in  which  it  is  organized.     ('07  c.  345  s.  10.) 


THE    STATE    OF    MINNESOTA  499 

Expenses. 

Section  110.  Every  association  sliall  make  provision  in  its  con- 
stitution and  laws  for  jiaynicnt  1)\'  incnilicrs  of  such  an  association, 
whieli  provi.siou  sliall  state  the  purpose  of  the  same  and  a  proportion 
thereof  which  may  be  used  for  expenses,  and  no  part  of  the  money 
collected  for  mortuary  or  disability  purposes  and  no  part  of  the 
reserve,  emergency  or  surplus  funds  of  the  net  accretions  of  either 
or  any  of  said  funds  shall  Ije  used  for  cxjicnses.    ( '07  e.  345  s.  11.) 

Benefits  Exempted  From  Process — Funds  and  Property,  Except 
Real  Estate,  Exempted  From  Taxation. 

Section  120.  The  money  or  otlier  benefits,  charity,  relief  or  aid, 
to  be  paid,  provided  or  rendered  by  any  association  authorized  to  do 
business  under  this  act,  shall  neither  before  nor  after  being  paid, 
be  liable  to  attachment,  garnishment,  or  other  process,  and  shall  not 
be  seized,  taken,  appropriated  or  applied  by  any  legal  or  equitable 
process  or  operation  of  law  to  pay  any  debt  or  liability  of  a  certifi- 
cate holder  or  of  any  beneficiary  named  in  a  certificate,  or  of  any 
person  who  may  have  any  right  thereunder;  such  associations  are 
hereby  declared  to  be  charitable  institutions,  and  the  property  held 
and  used  for  lodge  purposes,  aud  the  funds  of  such  associations  shall 
be  exempt  from  taxation  under  the  general  tax  or  revenue  laws  of 
this  State.  Except  that  the  real  estate  of  such  association  shall  be 
taxable.     ('07  e.  34.3  s.  12.) 

Methods  of  Forming  Association — Powers  and  Duties  of  Commis- 
sioner Herein — Preliminary  Certificate — Certificate  of  Association 
— Discontinuance  of  Business,  Eff"ect. 

Section  121.  Seven  (u-  more  persons,  citizens  of  the  United  States, 
and  a  majority  of  whom  are  citizens  of  this  State,  who  desire  to 
form  a  fraternal  beneficiary  association,  as  defined  by  this  act, 
may  make  and  sign — giving  their  addresses — and  acknowledge  be- 
fore some  officer  competent  to  take  acknowlcdgnu'nt  of  deeds,  arti- 
cles of  association  in  which  shall  be  stated: 

First — The   proposed   corporate   name   of   the    association,    which 


500  FRATERNAL    SOCIETY    LAW 

shall  not  so  closely  resemble  the  name  of  any  association  or  insurance 
company  already  transacting  business  in  this  State  as  to  mislead 
the  public  or  lead  to  confusion. 

Second — The  purpose  for  which  it  is  formed — which  shall  not 
include  more  liberal  powers  than  are  granted  by  thife  act,  provided 
that  any  lawful  social,  intellectual,  educational,  moral  or  religious 
advantages  may  be  set  forth  among  the  purposes  of  the  association — 
and  the  mode  in  which  its  corporate  powers  are  to  be  exercised. 

Third — The  names,  residences  and  official  titles  of  all  the  officers, 
trustees,  directors,  or  other  persons  who  are  to  have  and  exercise 
the  general  control  and  management  of  the  aifairs  and  funds  of  the 
association  for  the  first  year  or  until  the  ensuing  election,  at  which 
all  such  officers  shall  be  elected  by  the  supreme  legislative  or  govern- 
ing body. 

Such  articles  of  association  and  duly  certified  copies  of  the  consti- 
tution and  laws,  rules  and  regulations,  and  copies  of  all  proposed 
foi'ms  of  benefit,  certificates,  applications  therefore  and  literature 
to  be  issued  by  such  association,  and  ;i  bond  in  the  sum  of  $5,000 
with  sureties  approved  by  the  insurance  commissioner,  conditioned 
upon  the  return  of  the  advanced  payments,  as  provided  in  this 
section,  to  applicants,  if  the  organization  is  not  completed  within  one 
year,  or  after  such  further  period,  not  exceeding  one  year,  as  may  be 
authorized  by  the  insurance  commissioner,  shall  be  filed  with  the  in- 
surance commissioner,  who  may  require  such  further  information  as 
he  deems  necessary,  and  if  the  purposes  of  the  association  conform  to 
the  requirements  of  this  act  and  all  provisions  of  law  have  been 
complied  with,  the  insurance  commissioner  shall  so  certify  and  retain 
and  record  the  articles  of  association  in  a  book  kept  for  the  purpose 
and  furnish  the  incorporators  a  preliminai'y  certificate  authorizing 
said  association  to  solicit  members  as  hereiiuifter  provided. 

Upon  receipt  of  said  certificate  from  the  insurance  commissioner 
said  association  may  solicit  members  for  the  purpose  of  completing 
its  organization  and  shall  collect  from  each  applicant  the  amount  of 
not  less  than  one  death  benefit  assessment  or  payment,  in  accordance 
with  its  tables  of  rates,  as  provided  by  its  constitution  and  laws,  and 
shall  issue  to  each  such  apjilicant  a  receipt  for  the  amount  so  col- 
liM'icd.     Hilt   no  such  Mssoeiatiim  shall  incur  an\'  linbilitv  otliiT  than 


THE    ^TATh:    OF    I^l-NNEHOTA  501 

for  such  jiiiv.-iiircd  |),i\'iiiciit.s  nor  issue  ;iiiy  benefit,  certificjile,  nor 
p<iy  or  allow,  or  olfer  a  promise  to  pay  or  allow  to  any  person  any 
death  or  disability  benefit  until  actual  bona  fide  applications  for 
death  benefit  certificates  have  been  secured  upon  at  least  five  hun- 
(li'ed  lives  for  at  least  $1,000  each  and  all  such  applicants  for  death 
benefits  shall  have  been  regularly  examined  by  legally  qualified  xjrae- 
ticiiiu'  i)hysicians  and  certificates  of  such  examinations  have  been 
iliily  filed  and  ap])roved  by  the  chief  medical  examiner  of  such  asso- 
ciation, nor  until  there  shall  be  established  ten  subordinate  lodges 
or  branches  into  which  said  five  hundred  applicants  have  been 
initiated,  nor  until  there  has  been  submitted  to  the  insurance  com- 
missioner, under  oath  of  the  president  and  secretary  or  correspond- 
ing officers  of  such  association,  a  list  of  such  applicants,  giving  their 
names,  addresses,  date  examined,  date  approved,  date  initiated,  name 
and  number  of  the  subordinate  branch  of  which  each  applicant  is 
a  membei-.  amount  of  benefits  to  be  granted,  ra1?e  of  regular  pay- 
ments or  assessments,  which  shall  not  l)e  lower  for  death  benefits 
than  those  required  by  the  national  fraternal  congress  table  of  mor- 
tality with  interest  at  4  per  cent  per  annum ;  nor  until  it  sliall  be 
shown  to  the  insurance  commissioner  by  the  sworn  statement  of  the 
treasurer  or  corresponding  officer  of  such  association  that  at  least 
five  hundred  applicants  have  each  paid  in  cash  at  least  one  reg- 
ular monthly  payment  or  assessment  as  herein  provided  per  $1,000 
of  indemnity  to  be  affected,  which  payments  in  the  aggregate  shall 
amount  to  at  least  $2,500,  all  of  which  shall  be  credited  to  the 
mortuary  or  disability  fund  on  account  of  such  applicants  and  no 
part  of  which  may  be  used  for  expenses. 

Said  advanced  payments  shall  during  the  period  of  organization 
be  held  in  trust  for  and,  if  the  organization  is  not  completed  within 
one  .vear  as  hereinafter  provided,  returned  to  said  applicants. 

The  insurance  commissioner  may  make  such  examination  and 
require  such  further  information  as  he  deems  advisable,  and  upon 
presentation  of  satisfactorj-  evidence  that  the  association  has  com- 
plied with  all  the  provisions  of  the  law  he  shall  issue  to  such 
association  a  certificate  to  that  effect.  Such  certificate  shall  be 
prima  facie  evidence  of  the  existence  of  such  association  at  the 
date  of  such  certificate.     The  insurance  commissioner  shall   cause 


502  FRATERNAL    SOCIETY   LAW 

a  record  of  such  certificate  to  be  made  and  a  certified  copy  of 
such  record  may  be  given  in  evidence  with  like  effect  as  the  original 
certificate. 

No  preliminarj^  certificate  granted  under  the  provisions  of  this 
section  shall  be  valid  after  one  year  from  its  date,  or  after  such  fur- 
ther period,  not  exceeding  one  year  as  may  be  authoi-ized  by  the 
insurance  commissioner  upon  cause  shown,  unless  the  500  appli- 
cants herein  required  have  been  secured  and  the  organization  has 
been  completed  as  herein  provided,  and  the  articles  of  association 
and  all  proceedings  thereunder  shall  become  ni^ll  and  void  in  one 
year  from  the  date  of  said  preliminary  certificate,  or  at  the  expira- 
tion of  said  extended  period,  unless  such  association  shall  have 
completed  its  organization  and  commenced  business  as  herein  pro- 
vided. When  any  domestic  a.ssociation  shall  have  discontinued  busi- 
ness for  the  period  of  one  year,  its  charter  shall  become  null  and 
void.     ('07  c.  345  s.  13.) 

Existing  Associations  May  Come  Under  This  Act. 

Section  122.  Any  domestic  association  now  engaged  in  trans- 
acting- business  in  this  State,  may  exercise,  after  the  passage  of 
this  act,  all  of  the  rights  conferred  thereby,  and  in  addition  thereto 
may  exercise  all  of  the  rights,  powers  and  pi-ivileges  now  exercised 
or  possessed  by  it  under  its  charter  or  articles  of  association  not 
inconsistent  with  this  act  or  it  may  be  re-incorporated  hereunder. 
But  no  such  association  alreadj'  organized,  shall  be  required  to  re- 
incorporate hereunder,  nor  shall  it  be  required  to  adopt  the  rates 
precribed  herein  for  new  associations,  in  order  to  avail  itself  of 
the  privileges  of  this  act,  and  any  such  association  may  amend 
its  articles  of  association  from  time  to  time  in  the  manner  provided 
therein,  or  in  its  constitution  or  laws,  and  all  such  amendments 
shall  be  filed  with  the  insurance  commissioner  and  shall  become 
operative  upon  such  filing  unless  a  later  time  be  provided  in  such 
amendments,  or  in  its  articles  of  association,  constitution  or  laws. 
('07  c.  345  s.  14.) 


THE    STATE    OF    MINNESOTA  503 

Membership — How  Transferred  to  Another  Association. 

Section  123.  No  domestic  association  shall  transfer  its  member- 
ship or  funds  to  any  association  not  authorized  by  tlie  insurance 
commissioner  to  transact  business  in  this  State;  nor  shall  any  such 
association  transfer  it  membership  or  funds  to  any  licensed  asso- 
ciation, unless  the  said  contract  to  transfer  has  been  approved  by 
a  two-thirds  vote  of  the  member.s  of  the  supreme  bod,y  of  the  asso- 
ciation whose  membership  is  proposed  to  be  transferred ;  and  by 
a  two-thirds  vote  of  the  trustees  or  board  having  charge  of  the 
association  proposing  to  take  such  membership.     ('07  c.  34.5  s.  1-5.) 

Foreign  Associations   Continued — Licenses   to   be  Renewed  Annu- 
ally. 

Section  124.  Foreign  associations  which  are  now  authorized  to 
transact  business  in  this  State  may  continue  such  business  until 
the  first  day  of  March  next,  succeeding  the  passage  of  this  act, 
and  the.  authority  of  such  associations  ma.y  thereafter  be  renewed 
annually,  but  in  all  cases  to  terminate  on  the  first  day  of  the 
succeeding  March.  For  -each  such  license  or  renewal,  the  asso- 
ciation shall  pay  the  insurance  commissioner  .$10.  A  duly  cer- 
tified copy  of  such  license  shall  be  prima  facie  evidence  that  the 
licensee  is  a  fraternal  beneficiary  association  within  the  meaning 
of  this  act.     ('07  c.  345  s.  16.) 

Foreign  Associations — How  Admitted  to  do  Business  in  This  State. 

Section  125.  No  foreign  association  which  is  not  now  authorized 
to  transact  business  in  this  State  shall  transact  any  business  herein 
without  a  license  from  the  insurance  commissioner.  Before  receiv- 
ing such  license  it  shall  file  with  the  insurance  commissioner  a  duly 
certified  copy  of  its  charter  or  articles  of  association;  a  copy  of 
its  constitution  and  laws,  certified  by  its  secretary  or  corresponding 
officer;  a  power  of  attorney  to  the  insurance  commissioner  as  here- 
after provided ;  a  statement  under  oath  of  its  president  and  secre- 
tary or  corresponding  officers  in  the  form  required  by  the  insur- 
ance commissioner  duly  verified  by  an  examination  made  by  the 


504  FRATERNAL    SOCIETY    LAW 

supervising  insurance  official  of  its  home  State  of  the  business  for 
the  preceding  year;  a  copy  of  its  contract,  which  must  show  that 
benefits  are  provided  for  by  assessments  upon  or  other  payments 
by  persons  holding  similar  contracts  and  shall  furnish  the  insur- 
ance commissioner  with  such  other  information  as  he  may  deem 
necessary  to  a  proper  exhibit  of  its  business  and  plan  of  working 
and  if  he  finds  that  it  is  transacting  business  in  accordance  with 
the  provisions  of  this  act;  that,  its  assets  are  invested  in  accord- 
ance with  the  laws  of  the  State  where  it  is  organized;  and  that 
it  has  the  membership  and  qualifications  organized  under  this  act, 
he  may  license  such  association  to  do  business  in  this  State  until 
the  first  day  of  the  succeeding  March  and  such  license  may  be 
renewed  annually,  but  in  all  cases  to  terminate  on  the  first  day  of 
the  succeeding  ilarch.     ('07  c.  345  s.  17.) 

Licenses — Refusal  or  Revocation — Appeal — Hearing — Procedure — 
Existing  Contracts. 

Section  126.  When  the  insurance  commissioner  refuses  to  license 
any  association,  or  revokes  its  authority  to  do  business  in  this  State, 
he  shall  reduce  his  ruling,  order  or  decision  to  writing  and  file  the 
same  in  his  office,  and  shall  furnish  a  copy  thereof,  together  with  a 
statement  of  his  reasons,  to  the  officers  of  the  association,  upon 
request.  Any  society  affected  by  any  such  ruling,  order  or  decision 
shall  have  the  right  to  aj^peal  to  the  district  court  of  Ramsey  county 
in  this  State  by  filing  with  said  commissioner  its  notice  of  such 
appeal  in  writing,  and  in  such  case,  said  commissioner  shall  forth- 
with and  within  ten  days  thereafter,  deliver  to  such  association 
a  full  and  certified  transcript  of  all  proceedings  had  before  him 
in  said  matter,  including  all  applications,  together  with  all  orders, 
rulings  and  decisions  had  thereon  and  on  such  transcript  being 
filed  in  said  court,  such  court  shall  be  fully  possessed  of  said  action, 
and  ;i  full  ti-ial  im  the  merits  de  novo,  shall  be  had  thereon  and 
upon  such  hearing  the  findings  of  fact  on  which  such  order  is 
based  shall  be  prima  facie  evidence  of  the  matters  therein  settled; 
provided  further,  that  said  appeal  shall  be  filed  in  such  court  within 
forty  days  after  the  rendition  of  the  ruling,  order  or  decision  ap- 


THE    STATE    OF    MINNESOTA  505 

pealed  from;  and  provided  furthei',  that  nothing  herein  or  in  this 
act  contained  shall  be  taken  or  construed  as  preventing  any  such 
association  from  continuing  in  good  faith  all  contracts  made  in 
this  State  during  the  time  such  association  was  legally  authorized 
to  transact  business  therein.     ('07  c.  345  s.  18.) 

Foreign  Associations  to  Appoint  Commissioner  Attorney  to  Accept 
Service — Service  and  Its  Effect — Fee — Duties  of  Commissioner. 

Section  127.  Every  foreign  association  now  transacting  business 
in  this  State  shall  within  thirty  days  after  the  passage  of  this  act 
and  every  such  association  hereafter  applying  for  admission,  shall, 
before  being  licensed,  appoint  in  writing  the  insurance  commissioner 
and  his  successors  in  office  to  be  its  true  and  lawful  attorney, 
upon  whom  all  legal  process  in  any  action  or  proceeding  against  it 
shall  be  served  and  in  such  writing  shall  agree  that  any  lawful 
process  against  it,  which  is  served  upon  such  attorney  shall  be 
of  the  same  legal  force  and  validity  as  if  served  upon  the  asso- 
ciation, and  that  the  authority  shall  continue  in  force  so  long  as 
any  liability  remains  outstanding  in  this  State. 

Copies  of  such  appointment,  certified  by  said  insurance  commis- 
sioner, shall  be  deemed  sufficient  evidence  thereof  and  shall  be 
admitted  in  evidence  with  the  same  force  and  effect  as  the  original 
thereof  might  be  admitted.  Service  may  only  be  made  upon  sucli 
attorney,  must  be  made  in  duplicate  and  shall  be  deemed  sufficient 
service  upon  such  association ;  provided,  however,  that  no  such 
service  shall  be  valid  or  binding  against  any  such  association  when 
it  is  required  thereunder  to  file  its  answer,  pleading  or  defense  in 
less  than  thirty  days  after  the  date  of  such  service.  When  legal 
process  against  any  such  association  is  served  upon  said  insurance 
commissioner,  he  shall  forthwith  forward  by  registered  mail  one  of 
the  duplicate  copies,  prepaid  and  directed  to  its  secretary  or  corres- 
ponding officer.  The  plaintiff  in  such  process  so  served  shall  pay 
to  the  insurance  commissioner  for  the  use  of  the  State  at  the 
time  of  such  service  a  fee  of  $2,  which  shall  be  recovered  by  him 
as  part  of  the  taxable  costs,  if  he  prevails  in  the  suit.  ( '07  c.  345 
s.  19.) 


506  FRATERNAL   SOCIETY   LAW 

Meetings — Where  Held — Principal  Office. 

Section  128.  Any  domestic  association  may  provide  that  the  meet- 
ings of  its  legislative  or  governing  body  may  be  held  in  any  State, 
district,  province,  or  territory  wherein  such  association  has  sub- 
ordinate branches,  and  all  business  transacted  at  such  meetings 
shall  be  as  valid  in  all  respects  as  if  such  meetings  were  held  in 
this  State.  But  its  principal  office  shall  be  located  in  this  State. 
('07  c.  345  s.  20.) 

Constitution  and  Laws  May  Prevent  Subordinate  Bodies  From  Waiv- 
ing Provisions  Thereof. 

Section  129.  The  constitution  and  laws  of  the  association  may 
provide  that  no  subordinate  liody,  nor  any  of  the  officers  or  mem- 
bers of  such  subordinate  body,  shall  have  the  power  or  authority 
to  waive  any  of  the  provisions  of  the  laws  and  constitution  of  the 
association,  and  the  same  shall  be  binding  on  the  association  and 
each  and  every  member  thereof.     ('07  c.  345  s.  21.) 

Copies  of  Amendments  to  Constitution,  Etc.,  to  be  Filed — Evidence. 

Section  130.  Every  association  transacting  business  under  this 
act  shall  file  with  the  insurance  commissioner  a  duh^  certified  copy 
of  all  amendments  of  or  additions  to  its  constitution  and  laws 
within  ninety  days  after  the  enactment  of  the  same.  Printed  copies 
of  the  constitution  and  laws  and  of  additions  or  amendments  thereto, 
certified  by  the  secretary-  or  corresponding  officer  of  the  association 
shall  be  prima  facie  evidence  of  the  legal  adoption  thereof.  ( '07 
c.  345  s.  22.) 

Annual  Statement. 

Section  ^'■i^.  Every  association  transacting  business  in  this  State, 
shall  annually  on  or  before  the  fifteenth  day  of  February  file  v/ith 
the  insuraiu-e  commissioner  in  such  form  as  he  may  require,  a 
statement  under  oath  of  its  president  and  secretary,  or  correspond- 
ing officers  of  its  condition  and  standing  on  the  thirty-first  day  of 


THE    HTATE    OF    MINNK,'<OTA  507 

Decciiilx'i-  next  preceding  and  of  its  transactions  lur  the  \c;ir  ending 
on  that  date,  and  shall,  also,  furnish  such  other  information  as 
the  insurance  commissioner  may  deem  necessary  to  a  proper  exhibit 
of  its  business  and  plan  of  working.  The  insurance  commissioner 
m;iy  at  other  times  require  any  further  statement  he  may  deem 
necessary  to  be  made  relating  to  sucli  associations.  ('07  c.  345  s. 
23.) 

Domestic  Associations — Examinations — Procedure  to  Wind  Up — 
Duties  of  Commissioner  and  Attorney  General — Order  to  Show 
Cause,  Etc. 

Section  132.  The  insurance  commissioner,  or  any  person  he  may 
appoint,  shall  have  the  power  of  visitation  and  examination  into 
the  affairs  of  any  domestic  association.  He  may  employ  assistants 
for  the  jiurposes  of  such  examination  and  he,  or  any  person  he  may 
appoint,  shall  have  free  access  to  any  books,  papers  and  documents 
that  relate  to  the  business  of  the  association  and  may  summon  and 
qualify  as  witnesses  under  oath  and  examine  its  officers,  agents  and 
employes  or  other  persons  in  relation  to  the  affairs,  transactions 
and  condition  of  the  association. 

Whenever  after  examination  the  insurance  commissioner  is  sat- 
isfied that  any  domestic  association  has  failed  to  comply  with  any 
provisions  of  this  law  or  is  exceeding  its  powers,  or  is  not  carry- 
ing out  its  contracts  in  good  faith ;  or  is  transacting  business  fraud- 
ulently or  is  in  siieh  condition  as  to  render  further  proceedings 
hazardoiis  to  the  pul)lic  or  its  certificate  holders;  or  whenever  any 
domestic  association,  after  being  in  existence  one  year  or  more  and 
one  year  from  the  passage  of  this  act  shall  have  a  membership  of 
less  than  300,  or  votes  to  discontinue  business,  the  insurance  com- 
missioner may  present  the  facts  relating  thereto  to  the  attorney 
general,  who  shall,  if  he  deem  the  circumstances  warrant,  commence 
an  action  in  quo  warranto  in  a  court  of  competent  jurisdiction  and 
such  court  shall  thereupon  notify  the  officers  of  such  association  of 
a  hearing,  and,  unless  it  shall  then  appear  that  some  special  and 
good  reason  exists  why  such  association  should  not  be  closed,  said 
association  shall  be  enjoined  from  carrying  on  any  further  business, 


508  FRATERNAL    SOCIETY    LAW 

and  some  person  shall  be  appointed  receiver  of  such  association 
and  shall  proceed  at  once  to  take  possession  of  the  books,  papers, 
moneys,  and  other  assets  of  the  association  and  shall  forthwith, 
under  the  direction  of  the  court,  proceed  to  close  the  affairs  of  the 
association  and  to  distribute  its  funds  to  those  entitled  thereto.  No 
such  proceedings  shall  be  commenced  by  the  attorney  general 
against  any  such  association  until  after  notice  has  been  duly  served 
on  the  chief  executive  officers  of  the  association  and  a  reasonable 
opportunity  given  to  it  on  a  date  to  be  named  in  said  notice  to 
show  cause  why  such  proceedings  should  not  be  commenced.  ('07 
c.  345  s.  24.) 

Certain  Proceedings  to  be  Instituted  by  Attorney  General  Only. 

Section  133.  No  action  or  proceedings  to  discontinue  or  enjoin, 
in  whole  or  in  part,  the  business  or  methods  of  any  such  domestic 
association,  or  to  appoint  a  receiver  therefor,  or  to  dissolve  the 
same,  or  in  any  manner  affecting  its  corporate  rights,  except  for 
failure  to  pay  final  .judgment,  or  to  oust  any  foreign  association  or 
enjoin  it  from  transacting  business  in  this  State,  shall  be  enter- 
tained by  any  court,  except  on  the  suit  of  the  attorney  general 
of  this  State.     ( '07  c.  345  s.  25.) 

Foreign  Associations — Examinations — Revocation   of  License — Ap- 
peal— Procedure. 

Section  134.  The  insurance  commissioner,  or  any  person  whom 
he  may  appoint,  may  examine  any  foreign  association  transacting 
or  applying  for  admission  to  transact  business  in  this  State.  The 
insurance  commissioner  may  employ  assi-stants  for  the  purj^ose  of 
such  examination  and  lie,  or  any  person  he  may  appoint,  shall 
have  free  access  to  all  the  books,  papers  and  documents  that  relate 
to  the  business  of  the  association  and  may  summon  and  qualify 
as  witnesses  under  oath  and  examine  its  officers,  agents,  emploj'es 
and  other  persons  in  relation  to  the  affairs,  transactions  and  con- 
dition of  the  association.  He  may  in  his  discretion  accept  in  lieu 
of  such  examination  the  examination  of  the  insurance  department 


THE    UTA'JE    OF    MiyyEHOTA  5O9 

of  the  State,  territory,  district,  province  or  country  where  such  asso- 
ciation is  organized. 

If  any  such  association  or  its  officers  refuse  to  submit  to  such 
examination  or  to  comply  with  tlie  provisions  of  this  section  rela- 
ting thereto,  or  if  upon  such  examination  the  insurance  commissioner 
on  investigation  is  satisfied  that  any  foreign  association  transacting 
business  under  this  act  has  exceeded  its  powers,  or  has  failed  to 
comply  with  the  provisions  of  the  law,  or  is  conducting  business 
fraudulently,  or  is  not  carrying  out  its  contracts  in  good  faith,  or 
is  in  such  condition  as  to  render  further  proceedings  hazardous 
to  the  |»ublic  or  its  certificate  holders,  he  may  by  a  written  order 
or  decision,  filed  in  his  office,  revoke  the  license  of  such  association 
to  do  business  in  this  State,  subject  to  an  appeal  by  such  asso- 
ciation as  provided  by  and  in  accordance  with  the  provisions  of 
section  18  (126  of  this  code)  of  this  act,  and  upon  any  such  aj)peal 
all  the  provisions  of  said  section  18  (126  of  this  code)  shall  apply 
thereto.  No  'such  license  shall  be  revoked  by  the  insurance  com- 
missioner until  after  notice  has  been  duly  served  on  the  chief 
executive  officers  of  the  association  and  a  reasonable  opportunity 
given  to  it  on  a  date  to  be  named  in  said  notice  to  show  cause 
why  such  license  should  not  be  revoked.     ('07  e.  345  s.  26.) 

Expenses  of  Examinations. 

Section  135.  The  necessary  expenses  of  any  examination  made 
by  the  insurance  commissioner,  pursuant  to  the  provisions  of  this 
act,  of  any  association  herein  authorized,  shall  be  paid  by  such 
association  ;  Inxt  no  per  diem  shall  be  paid  to  or  on  account  of  any 
regular  salaried  member  of  the  insurance  department,  nor  a  per 
diem  of  more  than  $10  to  any  other  person,     ('07  c,  345  s.  27.) 

Certain  Bodies  Included  and  Others  Excluded  From  the  Provisions 
of  this  Act. 

Section  136.  Nothing  contained  in  this  act  shall  be  construed 
to  affect  or  apply  to  grand  or  subordinate  lodges  of  Masons,  Odd 
Fellows,   Elks   or   Knights   of  Pythias — exclusive   of  the   insurance 


510  FRATERNAL    SOCIETY    LAW 

braucli  of  the  supreme  lodge  Knights  of  Pythias — or  to  simihir 
orders  which  do  not  issue  insurance  certificates,  nor  to  local  lodges 
of  an  association  now  doing  business  in  this  State,  that  provide 
death  benefits  not  exceeding  $300  to  any  one  person,  or  disability 
benefits  not  exceeding  $300  in  any  one  year  to  any  one  person,  or 
both ;  nor  to  any  contracts  of  reinsurance  of  or  between  such  local 
lodges  of  such  associations  now  doing  business  on  such  plan  in 
this  State,  nor  to  domestic  associations  which  limit  their  member- 
ship to  the  employees  of  a  particular  city  or  town  designated 
firm,  business  house  or  corporation ;  nor  to  domestic  lodges,  orders 
or  associations  of  a  purely  religious,  charitable  and  benevolent  de- 
scription, which  do  not  operate  with  a  view  to  profit  and  which 
do  not  provide  for  a  death  benefit  of  more  than  $100,  or  for  dis- 
ability benefits  of  more  than  $150  to  any  one  person  in  any  one 
year,  provided  always,  that  any  such  domestic  order  or  association 
which  has  more  than  500  members,  and  provides  for  death  or  dis- 
ability benefits  and  any  such  domestic  lodge,  order  or  association 
which  issues  to  any  person  a  certificate  providing  for  the  payment 
of  benefits,  shall  not  be  exempt  by  the  provisions  of  this  section, 
but  shall  comply  with  all  the  requirements  of  this  act.  The  insur- 
ance commissioner  may  require  from  any  association  such  infor- 
mation as  will  enable  him  to  determine  whether  such  association 
is  exempt  from  the  provisions  of  this  act.  No  association  which 
is  exempt  by  the  provisions  of  this  section  from  the  requirements 
of  this  act,  shall  give  or  allow  or  promise  to  give  or  allow  to  any 
person,  any  compensation  for  procuring  new  members.  ('07  c.  345 
s.  28.) 

Violations  of  Act — Penalties. 

Section  137.  Any  person,  otfieer,  member  or  examining  physieiiiu. 
who  .shall  knowingly  or  wilfullymake  any  false  or  fraudulent  state- 
ment or  representation  in  or  with  reference  to  any  application 
for  membership  or  for  the  purpose  of  obtaining  money  from  or 
benefit  in  any  association  transacting  business  under  this  act,  shall 
be  guilty  of  a  misdemeanor  and  upon  conviction  thereof,  shall  be 
punished  by  a  fine  of  not  more  than  .$100.  or  imprisonment  in  the 


THE    tiTATE    OF    AJlSM'mOTA  511 

county  jail  for  not  more  than  ninety  days,  in  the  discretion  of  the 
court,  and  any  person  who  shall  wilfnlly  make  a  false  statement 
of  Miiy  material  fact  or  thiiiy  in  a  sworn  statement  as  to  the  death 
or  disability  of  a  certificate  holder  in  any  sneli  association,  for  tiie 
purpose  of  procuring  payment  of  a  benefit  named  in  the  certificate 
of  such  holder,  and  any  person  who  shall  wilfidly  make  any  false 
statement  in  any  verified  report  or  declaration  under  oath  required 
or  authorized  by  this  act,  shall  be  guilty  of  perjury,  and  shall  be 
proceeded  against  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  perjury. 

An\-  person  who  shall  solicit  membershij)  for,  or  in  any  manner 
assist  in  procuring  membership  in,  any  association  not  licensed  to 
do  l)usiness  in  this  State;  or  who  shall  solicit  membership  for, 
or  in  any  manner  assist  in  procuring  membership  in,  any  such 
association  not  authorized  as  herein  provided,  to  do  business  as 
herein  defined  in  this  State,  shall  be  guiltj-  of  a  misdemeanor,  and 
upon  conviction  thereof,  shall  be  punished  by  a  fine  of  not  more 
than  $100. 

Any  association,  or  any  oiificer,  agent  or  employee  thereof,  neg- 
lecting or  refusing  to  comply  with,  or  violating  any  of  the  pro- 
visions of  this  act,  the  penalty  for  which  neglect,  refusal  or  vio- 
lation is  not  specified  in  this  section,  shall  be  fined  not  exceeding 
$100  upon  conviction  thereof.     ('07  c.  345  s.  29.) 


Definitions — Deputy  Insurance  Commissioner  to  Act — When. 

Section  138.  The  word  "association"  as  used  in  this  act  shall 
be  taken  and  construed  as  meaning  a  fraternal  beneficiary  cor- 
poration, society,  order  or  voluntary  association  as  defined  in  this 
act.  The  words  "domestic  association"  shall  be  taken  and  con- 
strued as  meaning  an  association  organized  or  incorporated  under 
the  laws  of  this  State.  The  words  "foreign  association"  shall  be 
taken  and  construed  as  meaning  an  association  organized  or  in- 
corporated under  the  laws  of  another  territory,  district.  State,  prov- 
ince or  country.  The  word  "State,"  as  used  in  this  act,  shall  be 
taken  and  construed  as  meaning  "State,"  "territory,"  "district," 
"countrj^"  or  "province."     All  provisions  of  each  section  of  this 


512  FRATERNAL    SOCIETY    LAW 

act  except  as  otherwise  provided,   shall  be  taken  and  construed 
as  applying  to  both  domestic  and  foreign  associations. 

In  the  event  of  a  vacancy  in  the  office  of  the  insurance  commis- 
sioner or  iu  the  absence  or  disability  of  that  officer  the  deputy 
insurance  commissioner  shall  perfoi-m  all  the  duties  required  of 
the  insurance  commissioner  by  this  act.     ( '07  c.  345  s.  30.) 

Valuations  of  Benefit  Certificates. 

Section  139.  Nothing  contained  in  this  act  shall  be  construed 
to  require  any  society  to  make  or  cause  to  be  made  any  valuation 
of  its  benefit  certificates  for  any  pui-pose  whatsoever,  nor  shall 
the  insurance  depai'tment  have  the  right  to  require  or  demand 
that  such  valuation  be  made  or  embraced  iu  the  report  of  any 
fraternal  beueficiar.y  society  to  the  insurauce  department;  nor  shall 
any  valuation  of  the  certificates  of  any  association,  if  made  by  the 
insurance  department,  be  published  unless  upon  request  of  such 
association.     ( '07  e.  345  s.  31.) 

Insolvency. 

Section  140.  In  case  any  such  company  is  adjudged  insolvent, 
the  balauoe  of  its  reserve  fund,  if  any,  after  payment  of  claims  and 
other  indebtedness,  shall  be  paid  to  the  commissioner,  and  by  him 
paid  into  the  State  treasury.     (R.  S.  '05  s.  1704.) 

The  following  two  Sections  of  Chapter  58,  Revised  Laws,  1905, 
of  Minnesota  are  pertinent  to  the  subject  matter  of  this  chapter. 

Terms  Defined. 

Section  2839.  The  term  "private  corporation."  as  used  in  this 
chapter,  shall  include  every  company,  association,  or  body  endowed 
by  law  with  any  corporate  power  or  function  whatsoever,  except 
such  as  are  formed  solely  for  public  and  governmental  purposes, 
which  shall  be  deemed  public  corporations.  And,  when  not  other- 
wise indicated  by  the  context,  the  word  "corporation"  shall  mean 
a  private  corporation.  The  term  "certificate  of  incorporation." 
whenever  used  iti  this  chapter  in  reference  to  corporations  formed 


THE    HTATE    OF    MINNESOTA  513 

pricir  to  the  taking  effect  of  the  Revised  Laws,  shall  be  construed 
as  meaning  articles  of  incorporation. 

Domestic  and  Foreign  Corporations  Defined. 

►Section  2840.  The  term  ''domestic  corporation"  sliall  mean  every 
corporation  organized  under  the  laws  of  this  State,  and  the  term 
"foreign  corporation"  shall  mean  every  other  corporation. 

Chapter  318  Revised  Laws  of  1907  of  Minnesota  relates  to  "Co- 
operative Life  and  Casualty  Companies"  and  the  last  Section  of 
said  Chapter  reads  viz. : 

Fraternal  Beneficiary  Associations  Not  Affected. 

Section  107.  The  provisions  of  this  act  shall  not  apply  to  fra- 
ternal beneficiary  associations  nor  shall  anything  herein  be  con- 
strued as  governing  or  in  anywise  regulating  such  associations.  ( '07 
c.  318  s.  12.) 

The  following  Section  of  the  General  Insurance  Laws  in  express 
terms  applies  to  Fraternal  Societies: 

Political   Contributions   Prohibited — Penalties — Evidence — Immu- 
nity. 

Section  64.  No  insurance  company  or  association,  including  fra- 
ternal beneficiary  associations,  doing  business  in  this  State,  shall 
directly  or  indirectly  pay  or  use  or  offer,  consent  or  agree  to  pay 
or  use  any  money  or  property  for  or  in  aid  of  any  political  party, 
committee  or  organization,  or  for  or  in  aid  of  any  corporation, 
joint  stock  or  other  association  organized  or  maintained  for  political 
purposes,  or  for  or  in  aid  of  any  candidate  for  political  office,  or 
for  nomination  for  such  office,  or  for  any  political  purpose  what- 
soever, or  for  reimbursement  or  indemnification  of  any  person  for 
money  or  property  so  used.  Any  ofScer,  director,  stockholder,  at- 
torney or  agent  of  any  corporation  or  association  which  violates 
any  of  the  provisions  of  this  act,  who  participates  in,  aids,  abets, 
or  advises  or  consents  to  any  such  violation,  and  any  person  who 
solicits  or  knowingly  receives  any  money  or  property  in  violation 
33 


514  FRATERNAL    SOCIETY    LAW 

of  this  act,  shall  be  guilty  of  a  gross  misdemeanor  and  any  officer 
aiding  or  abetting  in  any  contribution  made  in  violation  of  this 
act,  shall  be  liable  to  the  company  or  association  for  the  amoimt 
so  contributed. 

No  person  shall  be  excused  from  attending  and  testifying,  or 
producing  any  books,  papers  or  other  documents  before  any  court 
or  magistrate,  upon  any  investigation,  proceeding  or  trial,  for  a 
Tiolation  of  any  of  the  provisions  of  this  act,  upon  the  ground  or 
for  the  reason  that  the  testimony  or  evidence,  documentary  or 
otherwise,  required  of  him  may  tend  to  incriminate  or  degrade 
him;  but  no  person  shall  be  prosecuted  or  subjected  to  any  penalty 
or  forfeiture  for  or  on  account  of  any  transaction,  matter  or  thing, 
concerning  which  he  may  so  testify  or  produce  evidence,  docu- 
mentary or  otherwise,  and  no  testimony  so  given  or  produced  shall 
be  used  against  him  upon  any  criminal  investigation  or  proceed- 
ing.    ('07  c.  42.) 

Section  48  of  the  Insurance  Laws  Edition  1907  requires  Life 
Companies  to  file  in  the  State  Insurance  Department  annual  state- 
ments, but  the  last  paragraph  contains  an  exemption  in  favor  of 
Fraternal  Societies  in  the  following  language : 

"No  company  or  agent  thereof  shall  transact  any  new  business 
in  this  State  after  March  1  in  any  year  unless  it  shall  have  pre- 
viously transmitted  such  statement  to  the  commissioner;  but  no 
fraternal  beneficiary  association,  nor  any  social  corporation  paying 
only  "sick  benefits"  not  exceeding  two  hundred  and  fifty  dollars 
in  any  one  year,  or  "funeral  benefits,"  or  aiding  those  dependent 
on  a  member  not  more  than  three  hundred  and  fifty  dollars,  nor 
any  subordinate  lodge  or  council  which  it,  or  whose  members  are, 
assessed  for  benefits  which  are  payable  by  a  grand  body,  shall 
be  required  to  make  such  statement."  (R.  L.  '05  s.  1618  as  amended 
by  '07  c.  11  s.  1;  Sec.  2  of  Ch.  11  '07  repealed  '05  c.  248.) 

Fraternal  Societies  Cannot  Pay  Dividends  or  Endowments. 

A  fi-iiternal  society  executed  contracts  by  which  it  agreed  to  pay 
to  members  diiriiig  their  lifetime  certain  cash  lienefits,  the  Court 
said: 


THE    UTATK    Ob'    MINNESOTA  515 

"An  association  that  agrees  to  \);\y  diviilcnils  or  niatnrctl  licnefits 
to  its  livinp:  nieniliors  who  are  not  nnder  disability  is  to  that  extent 
not  doinsi-  a  tViitei'iinl  henelil  Imsiness  and  is  not  entitled  1o  the  con- 
sideration shown  by  our  laws  to  beneticiaries  and  to  i'r-aternai  asso- 
ciations. It  does  not  protect  those  who  in^ed  proteclion  oi'  benefit 
those  who  ha\'e  h)st  the  sujjport  of  father,  hnsband  or  brolliei-.  11  is 
a  speculation  or  investment,  the  profits  of  which,  if  any  there  be, 
accrue  to  the  member  himself.  If  the  plaintiff  wi.shes  to  do  that  kind 
of  business  in  this  State,  it  must  not  masquerade  as  a  fraternal  bene- 
ficiary association. ' ' 
-  The  Court  cites  in  support  of  its  conclusion,  the  following  cases: 

State  vs.  Orear.  144  Mo.  157;  4.5  S.  W.  1081; 

Calkins  vs.  Bump.  79  N.  W.  491;   120  Mich.  335; 

Association  vs.  Hunt.  127  111.  257;  20  N.  B.  55; 

Rockhold  vs.  Masonic  Society,  129  HI.  440:   21  N.  E.  794;   2  L.  R.  A. 

420; 
Order  of  International  Fraternal  Alliance  vs.   State,  77  Md.  547;   26 

Atl.  1040; 
Dishong  vs.  Iowa  Co..  92  Iowa,  lfi3;  (iO  N.  W.  505. 

The  case  at  bar  was  one  arising  from  the  denial  of  a  license  by  the 
Insurance  Commissioner  to  a  fraternal  society  organized  in   New 

York  to  do  business  wilhin  fhe  State  of  ilimipsota. 

National    Protective    Legion    vs.    O'Brien,    Insurance    Commissioner^ 
Supreme  Court  of  Minnesota,  July,  1907,  112  N.  W.  1050. 

Fraternal  Societies  Cannot  Issue  Endowment  Contracts. 

The  fraternal  beneficiary  act  of  Minnesota  is  construed  in  a  well 
considered  case  in  which  it  is  held  that  fraternal  societies  are  not 

permitted  to  sell  endowment  contracts. 

National    Protective    Legion    vs.    O'Brien,    Insurance    Commissioner, 
Supreme  Court  of  Minnesota,  July,  1907.  112  N.  W.  1050. 

Deliberate  Suicide  by  Drugs. 

One  who  intentionall v  fakes  his  own  life  hv  admiin'stering  to  him- 


516  FRATERNAL    SOCIETY    LAW 

self  a  poisonous  drug  being  of  sufficient  mental  capacity  to  compre- 
hend the  nature  and  consequences  of  the  act,  commits  deliberate 
suicide.  The  provision  in  the  contract  excepted  death  through 
"deliberate  suicide." 

Zearfoss  vs.  Switchmen's  Union  of  N.  A.,  Supreme  Court  of  Minne- 
sota, July,   1907,   112   N.  W.   1044. 

Statements  of  Members  as  to  Age  Competent  to  Prove  True  Age. 

Declarations  and  admissions  of  the  insured,  since  deceased,  respect- 
ing the  date  of  his  birth,  are  admissible  against  the  beneficiary  in  an 
action  to  recover  upon  the  benefit  certificate,  where  the  defense  is 
false  representation  in  the  application  for  membership,  and  which 
application  is  made  the  basis  of  the  issuance  of  the  certificate. 

Taylor  vs.  Grand  Lodge  A.  0.  U.  W.,  May  10th,  1907,  101  Minn.  72; 
111  N.  W.  919. 

Statement  as  to  Age — Previous  Applications  to  Other  Societies  Ad- 
missible. 

Where  the  laws  of  a  society  make  the  application  the  basis  for 
the  insurance,  a  prior  application  for  insurance  in  another  company 
is  admissible  in  evidence  against  the  beneficiary  in  an  action  to 
recover  where  the  defense  is  misrepresentation  as  to  the  age  of  the 
applicant  at  tlie  time  of  making  the  apjilication. 

Taylor  vs.  Grand  Lodge  A.  O.  U.  W.,  May  10th,  1907,  101  Minn.  72; 
111  N.  W.  919. 

Conditions  Precedent,  Applications  and  Examinations. 

Courts  will  take  judicial  notice  of  the  fact  that  life  insurance  com- 
panies require  as  a  condition  precedent  to  the  issuance  of  a  benefit 
certificate  a  properly  executed  application  and  medicMl  examination 
of  the  Mpjiliciint.  which  is  ;i  iinironii  iind  generally  known  cnstoiii. 

Taylor  vs.  Grand  Lodge  A.  0.  U.  W..  May  10th,  1907.  101  Minn.  72; 
111  N.  W.  919. 


THE    STATE    OF    MINNESOTA  517 

After-enacted  Laws — Resort  to  Civil  Courts. 

Whero  the  member  in  his  application  agrees  to  be  boiind  l)y  the 
laws  of  the  society,  a  by-law  prohil)itin<i  resort  to  the  courts  before 
exhausting  the  provided  remedies  williin  the  society  itself,  if  rea- 
sonable, are  valid  and  binding  nj)oii  the  iriembers     . 

Lindahl  vs.  Supreme  Court  I.  0.  F.,  .Ian.  25th.  1907,  100  Minn.  87; 
110  N.  W.   358. 

After-enacted  Laws — Unreasonable  Requirements  as  to  Resort  to 
Civil  Courts. 

Where  the  by-laws  of  a  society  required  the  members  to  exhaust 
the  remedies  [>rovided  within  the  society,  before  resorting  to  the 
courts  to  enforce  their  claims,  and  where  the  compliance  with  these 
by-laws  would  postpone  the  ultimate  disposition  of  the  member's 
claim,  which  accrued  in  ]\Iarch,  1905,  to  the  meeting  of  the  supreme 
order,  in  1908,  it  was  held  that  the  by-laws  were  unreasonable,  and 
need  not  have  been  complied  with  in  order  to  sustain  an  action  in 
the  civil  courts. 

Lindahl  vs.  Supreme  Court  I.  O.  F.,  Jan.  25th,  1907,  100  Minn.  87; 
110  N.  W.  358. 

Suicide — Presumptions. 

The  presumption  of  hnv  is  against  suicide,  and  the  burden  is  upon 
the  defendant  to  establish  it. 

Lindahl  vs.  Supreme  Court  I.  0.  F.,  Jan.  25th,  1907,  100  Minn.  87; 
110  N.  W.  358. 

Suicide — Circumstantial  Evidence. 

Where  the  evidence  relied  upon  by  the  defendant  is  circumstantial, 
the  facts  presented  must  be  of  such  a  character  as  to  exclude  any  rea- 
sonable hypothesis  that  the  death  was  natural  or  accidental. 

Lindahl  vs.  Supreme  Court  1.  O.  F„  Jan.  25th,  1907.  100  Minn.  87; 
110  N.  W.  358. 


52g  FRATERNAL    SOCIETY    LAW 

After-enacted  Laws— Suicide— Unreasonable  Provisions. 

On  October  3rd,  1901,  the  defendant  society  issued  a  benefit  certifi- 
cate to  a  member,  who  in  his  application  agreed  to  be  bound  by  the 
laws  of  the  order  "now  in  force  or  hereafter  enacted."  A  by-law  in 
force  at  the  time  of  the  application  provided  that  benefits  should  not 
be  paid  upon  certificates  of  members  committing  suicide,  unless  the 
member  was  under  medical  treatment  for  insanity;  but.  in  lieu 
thereof,  the  amounts  paid  by  the  deceased  member  should  be  re- 
turned to  his  beneficiary.  In  July,  1903,  the  society  adopted  a  new 
by-law.  providing  that  in  the  event  that  the  member  committed  sui- 
cide, that  his  beneficiary  should  receive  5%  of  the  face  of  the  cer- 
tificate for  each  year  he  had  continuously  been  a  member  of  the  so- 
ciety. The  member  committed  suicide  on  May  21st,  1904,  while 
under  medical  treatment  for  insanity.  The  court  held  that  the 
change  in  the  bj^-laws  was  unreasonable,  and  therefore,  void. 

Olson  et  al.  vs.  Court  of  Honor,  Feb.  1st,  1907,  100  Minn.  117;   110 
N.  W.  374. 

Physicians  Testifying — Waiver  of  Exemptions. 

A  statute  providing  that  a  physician,  without  the  consent  of  his 
patient  cannot  be  examined  in  a  civil  action  as  to  any  information 
acquired  in  attending  the  patient,  was  held  to  be  for  the  benefit  of 
the  patient,  which  benefit  may  be  waived  by  a  member  in  his  appli- 
cation for  nu-mbership. 

Olson  et  al.  vs.  Court  of  Honor,  Feb.  1st,  1907,  100  Minn.  117;   110 
N.  W.  374. 

Resort  to  Civil  Courts. 

Provisions  in  liic  laws  of  a  benefit  society  requiring  members  to 
exhaust  their  remedy  within  the  society  before  appealing  to  the 
courts,  will  be  strictl.v  construed  against  the  defendant  atul  liberally 
in  favor  of  claimants. 

Carey  vs.  Switchmen's  Union  of  N.  A.,  May  4th,  190i;.  9S  Minn.  28; 
107  N.  W.  129. 


THE    STATE    OF   MINNESOTA  519 

Resort  to  Civil  Courts — Unreasonable  Provisions. 

The  defendant  member  was  injured  December  29th,  1902.  He 
duly  presented  his  claim  for  sick  benefits  to  the  proper  officers  of  the 
'  society,  and  which  was  disallowed.  He  failed  to  comply  with  the 
laws  of  the  society  by  formally  appealing  to  its  next  convention, 
which  met  on  May  3rd,  1903,  but  the  pvideiiee  showed  that  the  of- 
ficers of  the  society  reported  the  claim  to  the  convention,  which 
referred  it  to  the  committee  on  claims  and  appeals,  which  reported 
back,  recommending  that  action  on  the  claim  be  postponed,  and  the 
convention  referred  the  claim  back  to  the  Grand  Lodge  for  its 
action,  but  which  would  not  meet  for  two  years,  and  that  the  plain- 
tiff understood  that  his  claim  was  being  considered  by  the  conven- 
tion. The  member  brought  suit  October  5th,  1904.  Held,  that  the 
defense  of  non-compliance  with  the  by-laws,  in  that  the  plaintiff  did 
not  appeal  to  the  convention,  and  thereby  exhaust  his  remedies 
within  the  society,  was  not  a  good  defense. 

Carey  vs.  Switchmen's  Union  of  N.  A.,  May  4tli,  1906,  98  Minn.  28; 
107  N.  W.  129. 

New  Trial — New  Evidence  Must  Be  Such  as  to  Probably  Change 
Result. 

Before  sustaining  a  motion  for  a  new  trial,  on  the  ground  of  newly 
discovered  evidence,  it  is  not  enough  to  consider  whether  the  new 
evidence  is  material,  it  must  also  be  important,  and  of  such  a  char- 
acter that  taken  in  connection  with  the  evidence  already  before  the 
Court,  will  materially  effect  the  result  upon  another  trial. 

Bunker  vs.  United  Order  of  Foresters,  97  Minn.  361;   107  N.  W.  392, 
Feb.  23,  1906. 

Suicide  While  Insane. 

The  by-laws  of  the  defendant  society  forfeited  all  benefits  if  the 
"member  shall  commit  suicide  or  self-destruction."  The  declaration 
admitted  suicide  and  averred  insanity  and  mental  irresponsibilitj'' ; 
that  the  member  had  not  the  capacity  to  exercise  reason,  or  to  realize 


520  FRATERNAL    SOCIETY    LAW 

the  effect  and  conseqiu'nce  of  his  act;  that  he  was  impelled  to  commit 
suicide  bj'  an  irresponsible  insane  impulse.  Held,  that  if  the  evi- 
dence sustained  the  allegations  as  to  mental  condition,  and  which 
was  a  question  for  the  juiy  to  determine,  suicide  was  not  a  defense. 

Bunker  vs.  United  Order  of  Foresters,  Feb.  23,  1906,  97  Minn.  361; 
107  N.  W.  392. 

Warranties  in  the  Application. 

Where  the  court  instructed  the  jury  that  the  statements  made  by 
the  claimant  in  his  application  are  warranties,  it  is  competent  for 
the  jury,  in  making  tip  its  verdict  to  take  into  consideration  admis- 
sions of  the  oiScers  of  the  defendant  society  as  to  the  cause  of  the 
death. 

Ranta  vs.  Supreme  Tent  Knights  of  the  Maccabees,  March  30th,  1906, 
97  Minn.  454;   107  N.  W.  156. 

Errors  on  Appeal. 

The  defendant  society  can  raise  only  such  errors  as  were  excepted 
to  in  the  trial  court  autl  covered  by  its  assignment  of  errors  vtpon 
appeal. 

Ranta  vs.  Supreme  Tent  Knights  of  the  Maccabees,  March  30th,  1906 
97  Minn.  454;   107  N.  W.  156. 

Warranties — Construction  of. 

A  contract  warranting  the  truth  of  the  applicant's  statements  is 
binding  upon  the  parties,  and  a  failure  of  the  truth  of  warranties 
avoids  the  beuefit  certificate ;  but  the  warranty  must  be  a  warranty 
of  fact,  like  the  age  of  the  applicant,  and  cannot  apply  to  expert 
opinion  of  matters  based  upon  belief  and  good  judgment,  such  as 
the  condition  of  his  mother's  health,  which  at  best  can  only  be  an 
honest  judgment,  if  the  evidence  shows  such  statemeuts  were  made 
in  good  faith,  it  will  defeat  a  defense  founded  upon  breach  of  war- 
ranties. 


THE    STATE    OF   MINNESOTA  521 

Ranta  vs.  Supreme  Tent  Knights  of  the  Maccabees,  March  30th,  1906, 
97  Minn.  454;   107  N.  W.  156. 

Warranty  as  to  Age. 

The  laws  of  a  society  rcsti'ii-ted  mi'mlii  isliip  to  persons  under  45 
yeai's  of  age  at  the  time  of  admission.  In  his  application  the  member 
certified  that  he  was  44,  and  thMt  if  it  should  thereafter  appear  he 
had  made  false  statements  in  any  particular,  it  should  render  his 
benefit  certificate  null  and  void.  The  evidence  showed  that  the  mem- 
bei'  paid  all  his  dues  and  assessments  regularly  from  his  admission 
to  the  date  of  his  death,  but  that  at  the  time  of  making  his  applica- 
tion he  was  45  years  of  age.  Held,  that  the  plaintifi!  could  not  re- 
cover as  the  misstatement  of  the  age  was  a  material  misrepresenta- 
tion and  increased  the  risk. 

Taylor  vs.  Grand  Lodge  A.  O.  U.  W.,  December  15th,  1905,  96  Minn. 
441;   105  N.  W.  40S. 

Warranty — Void  Contract  Ab-initio. 

Where  the  laws  of  a  society  restricted  membership  to  persons 
under  45  years  of  age,  a  benefit  certificate  issued  to  an  applicant  who 
is  45  years  of  age,  and  who  fraudulently  represents  in  his  application 
that  he  is  but  44,  and  who  regularly  pays  his  dues  and  assessments  to 
the  time  of  his  death,  and  where  the  society  has  no  knowledge  of  his 
fraud  until  proofs  of  death  are  received  by  it.  it  is  held  that  the 
applicant  never  became  a  member  of  the  defendant  society,  and  that 
the  certificate  was  null  and  void  ab  initio,  and  that  the  beneficiary 
cannot  recover. 

Taylor  vs.  Grand  Lodge  A.  O.  U.  W.,  December  15th,  1905,  96  Minn. 
441;  105  N.  W.  40S. 

Void  Contract — Payments  Made  Forfeited. 

Where  the  laws  of  a  society  restricts  membership  to  persons  under 
45  years  of  age,  a  benefit  certificate  is  obtained  fraudulently  repre- 
senting the  member  (applicant)  within  the  restriction,  and  which 


522 


FRATERNAL    SOCIETY    LAW 


fraud  is  uot  discovered  by  the  society  until  proofs  of  death  are  re- 
ceived, the  society  is  under  no  legal  obligation  to  return  the  dues 
and  assessments  which  had  been  paid  by  the  deceased  member  in 
order  to  sustain  its  defense  that  the  contract  was  null  and  void. 

Taylor  vs.  Grand  Lodge  A.  O.  U.  W.,  December  15th,  1905,  96  Minn. 
441;  105  N.  W.  408. 

No  Waiver  of  Forfeiture  by  Negotiations. 

The  defendant  society  is  not  estopped  from  claiming  that  a  benefit 
certificate  is  null  and  void  by  reason  of  its  having  requested  the 
beneficiary  to  select  an  attorney  at  law  to  represent  her  in  negotia- 
tions for  settlement  of  her  claim. 

Taylor  vs.  Grand  Lodge  A.  0.  U.  W.,  December  15th,  1905,  96  Minn. 
441;  105  N.  W.  408. 

Change  of  Occupation — Forfeiture. 

A  provision  contained  in  the  certificate  provided  that  if  a  member 
should  enter  upon  or  follow  any  employment  or  occ\i])ation  named 
in  a  certain  section  of  the  by-laws  then  in  force  or  as  same  might 
thereafter  be  amended,  that  the  certificate  should  become  ips^o  facto 
void.  At  the  time  of  the  issuance  of  the  certificate  the  member  re- 
ceiving same  was  a  paper-hanger,  and  that  was  his  occupation  up  to 
within  about  five  months  before  his  death.  Subsequently  and  up  to 
the  time  of  his  death  he  was  a  railroad  freight  brakeman  and  he  was 
killed  while  following  that  occupation.  The  society  did  not  know, 
until  after  his  death,  that  he  had  engaged  in  the  occupation  of  brake- 
man.  The  Court  held  that  the  member's  death  having  resulted  from 
one  of  the  excepted  causes  for  which  it  was  stipulated  that  the  society 
should  not  bo  liable,  the  beneficiary  could  not  recover. 

Abell  vs.  Modern  "Woodmen,  December,  1905,  96  Minn.  494;  105  N.  W. 
65. 

Change  of  Beneficiary. 

For  the  facts  in  the  case  where  during  a  niciiilici-'s  enfeebled  con- 


THE    STATE    OF    MINNESOTA  523 

dition  by  reason  of  his  sickiipss  and  under  the  influence  of  a  lirother 
he  chans'<^d  his  certificate,  and  the  efi'ect  of  sueli  cluinti-e,  see  the  fol- 
lowing: 

Knauer  vs.  Grand  Lodge  A.  O.  U.  W.,  June,  1905,  95  Minu.  518;   103 
N.  W.  1132. 

Warranties — False  Answers  Defeat  Contract. 

Parties  to  an  insurance  contract  ma\'  by  apt  words  make  a  fact 
material  whieli  would  otherwise  be  inunaterial  and  may  make  im- 
material a  fact  which  would  otherwise  be  material.  Where  the 
answers  to  questions  in  the  application  and  in  statements  of 
medical  history  are  warranties  there  can  be  no  recovery  on  the  con- 
tract if  these  answers  are  false. 

Rupert   vs.    Supreme    Court   United    Order   of    Foresters,    February, 
1905,  94  Minn.  293;   102  N.  W.  715. 

Who  Are  "Orphans." 

As  to  who  are  orphans,  the  Court  said  in  view  of  the  particular 
contract  under  consideration : 

"It  is  apparent  that  the  word  'orphans'  was  used  therein  in  the 
sense  of  children,  and  not  \n  the  strict  legal  sense  of  orphans.  A 
child  might  cease  to  be  an  orphan  within  the  strict  meaning  of  the 
law  on  arriving  at  his  majority  or  by  becoming  married,  but  he 
would  never  cease  to  be  the  child  of  his  mother  to  whatever  age  he 
might  live." 

Fischer  vs.  Malchow,  December,  1904,  93  Minn.  396;    101  N.  W.  602. 

Suicide — Sane  or  Insane. 

On  the  question  of  suicide  the  Supreme  Conrt  of  Minnesota  an- 
nounces the  law  as  follows : 

1.  Where  the  contract  is  silent  upon  the  subject,  the  insurer  is 
liable  in  the  event  of  suicide  of  the  insured. 

2.  Where  the  contract  provides  against  liability  in  general  terms, 


524:  FRATERNAL    .SOCIETY    LAW 

in  the  event  the  member  .suicides  the  insurer  is  not  liable  in  the  event 
of  intentional  self-destruction  wliile  sane,  but  is  liable  if  the  insured 
was  insane. 

3.  "Where  the  contract  provides  against  liability  in  the  case  of 
suicide  by  either  a  sane  or  an  insane  person,  such  a  provision  is 
binding  upon  the  parties  to  the  contract. 

Robson  vs.  United  Order  of  Foresters,  July,  1904,  93  Minn    24;   100 
N,  W.  381. 

Contract — What  Composes  Same. 

The  contract  in  a  fraternal  society  is  said  to  be  deducible  from 
the  application,  the  certificate,  the  by-laws  and  the  answers  of  the 
applicant  to  all  questions  contained  in  the  medical  examination  in- 
volving applicant's  physical  condition. 

Robson  vs.  United  Order  of  Foresters,  July,  1904,  93  Minn.  24;   100 
N,  W.  381. 

Warranties — Waiver — Agent's  Knowledge  Not  Imputed. 

A  society  prohibited  the  admission  of  bar-tenders  and  others  en- 
gaged in  the  business  of  selling  intoxicating  liquors  and  made  such 
persons  ineligible  to  membership.  An  application  was  taken  from  a 
person  who  was  following  one  of  the  occupations  prohibited,  and  the 
application  did  not  show  correctly  the  occupation  of  the  ap|)l leant. 
It  was  claimed  that  the  agent  who  filled  out  the  application  failed  to 
record  therein  the  whole  truth  respecting  said  occupation,  and  in- 
serted therein,  in  answer  to  the  proper  question,  the  statement  tliat 
the  api)licaut  was  a  painter  by  occupation.  It  was  held  that  if  the 
applicant  knew  of  the  untruthful  answers,  the  contract  would  be 
void  notwithstanding  the  fact  that  the  agent  may  have  known  the 
true  facts  in  the  case:  ami  that  the  test  in  determining  whether 
questions  contained  in  an  application  are  material  is  did  the  knowl- 
edge or  ignorance  of  the  facts  sought  to  be  elicited  thereby  materi- 
ally influence  the  action  of  the  insurer, 

Mattson  vs.   Modern   Samaritans,  February,   1904,   91  Minn.   434;    98 
N.  W,  330, 


THE    STATE    OF    MINNESOTA  525 

Beneficiaries — "Living  Issue"  Construed. 

A  certificate  in  tlie  A.  O.  U.  W.  was  issued  to  a  member  and  made 
payable  at  his  death  to  liis  widow.  There  was  a  ])rovisioii  in  the  laws 
of  the  society  to  the  effect  that  if  the  member  left  no  widow,  the  cer- 
tificate should  be  j)a\'abb'  1o  his  children,  etc.,  to  his  bi-othei's  or 
sisters,  "or  to  tlieir  living  issue  according  to  the  right  of  represen- 
tation." The  Court  said  in  construing  the  quoted  provision  above 
that  it  w;is  inteinhnl  to  refer  t<i  descendents  of  deceased  brothers  or 
sisters,  and  that  the  jjhrase  "their  living  issue"  was  used  synonV- 
nionsly  with  "lineal  descendents,"  and  that  so  construed  the  by-laws 
will  read  that  the  contract  should  be  paid  to  the  brothers  and  sisters 
of  the  member;  or  if  there  be  none  living  then  to  their  living  de- 
scendents according  to  the  right  of  representation. 

Hemenway  vs.  Draper,  January,  1904,  91  Minn,  236;    97  N.  W,  874. 

Prohibited  Occupations — Saloon  Keepers. 

A  provision  in  the  laws  of  a  societ.y  was  to  this  effect  "No  person 
who  engages  in  the  sale  of  intoxicating  drinks  can  be  admitted  or 
retained  as  a  member."  It  is  held  that  under  the  provisions  of  all 
the  laws  of  the  society  a  member  who  engaged  in  the  sale  of  intox- 
icating liquors  did  not  ipso  facto  terminate  his  membership  under 
said  laws. 

Steinert  vs.   United  Brotlierliood  of  Carpenters,   Decembei',  1903,  91 
Minn.  189;  97  N.  W.  668. 

Service  of  Summons.  ' 

Service  of  summons  upon  a  society  was  held  good  when  served 
upon  an  officer  residing  in  the  State,  neither  the  president  nor  any 
other  general  officer  being  a  resident  of  the  State. 

Taylor  vs.  Order  of  Railway  Conductors,  May,  1903,  89  Minn.  222;   94 

N.  W.  684. 

Amended  Laws  as  to  Occupations — Unreasonable. 

A  member  agreed  in  his  a]iiilication  to  be  boiuid  by  the  laws  of  the 


526  FRATERNAL    SOCIETY    LAW 

society  then  in  force  and  those  that  might  thereafter  be  enacted. 
Subsequent  to  his  admission  a  law  was  enacted  against  members  en- 
gaging in  the  occupation  of  freight  bralveman,  and  provided  further 
that  if  a  member  so  engaged  in  that  occupation,  he  sliould  forfeit 
his  certificate.  No  actual  notice  of  the  passage  of  this  law  was  given 
to  the  member,  but  subsequent  thereto  he  became  a  freight  brakeman 
and  was  killed  while  in  discharge  of  his  duty.  The  Court  held,  fol- 
lowing Thibert  vs.  Supreme  Lodge,  78  Minn.  448,  that  the  amended 
by-law  was  unreasonable  and  void  as  to  the  member. 

Tebo  vs.  Supreme  Council  Royal  Arcanum,  February,  1903,  89  Minn. 
3;   93  N.  W.  513. 

Waivers  by  Subordinate  Lodge. 

With  respect  to  the  waiver  of  laws  by  a  subordinate  body,  the 
Court  said : 

"It  cannot  be  claimed  that  the  habit  of  a  subordinate  council  to 
allow  delinquencies  to  occur,  should  continue  Avithout  change  to  pre- 
vent an  enforcement  of  the  by-laws  for  all  time  when  due  notice  to 
the  member  in  question  that  such  negligent  custom  should  cease 
had  been  given.  The  relation  of  the  subordinate  council  and  its  col- 
lector to  the  Supreme  Council  was  such  that  it  became  the  duty  of 
the  collecting  body  to  enforce  defendant's  regulations  although  it 
had  neglected  its  duty  in  the  past  in  a  way  that  might  have  estab- 
lished a  negligent  system,  and  misled  members.  It  could  not  have 
had  this  effect  after  proper  information  conveyed  to  the  insured  that 
the  custom  would  not  continue." 

Bost  vs.  Supreme  Council  Royal  Arcanum.  November,  1902.  87  Minn. 
417;  92  N.  W.  337. 

Waivers — Laws  Not  Waived  by  Custom. 

The  laws  of  a  society  required  that  monthl.v  payments  should  be 
made  by  a  certain  date  and  that  if  not  so  made  the  nuMuber  sluiuld 
stand  suspended  from  all  rights  and  in'ivilegcs  in  llic  sooiet.x'.  A 
habit  and  custom  had  grown  up  on  the  part  of  the  collecting  officer 
in  his  dealings  with  the  members  liy  which  he  acce]ited  iiayments 


THE    UTATE    OF    MINNESOTA  527 

after  the  time  when  they  were  due,  but  this  custom  was  not  known 
to  nor  authorized  nor  sanctioned  by  the  society  and  was  in  direct 
violation  of  the  by-hiws.  The  Court  held  that  the  custom  being  so 
unknown  was  ineffectual  as  a  waiver  of  the  by-laws  requiring-  jiroinpt 
payment  and  that  as  the  member  stood  suspended  at  the  time  of 
his  death,  his  beneficiary  could  not  recover. 

Graves  vs.  Modern  Woodmen  of  America,  February,  1902,  85  Minn. 
396;   89  N,  W,  6. 

Suicide — Burden  of  Proof. 

The  burden  of  proving  that  the  member  suicided  is  upon  the 
society.  For  the  facts  in  a  case  where  the  question  of  suicide  was 
in  issue,  see  the  following : 

Sartell    vs.   Royal   Neighbors   of   America,   January,   1902,    85    Minn. 
369;  88  N.  W.  985. 

Beneflciaries — Change  of. 

The  laws  of  a  society  in  respect  to  the  change  of  beneficiaries  pro- 
vided as  follows : 

"Any  member  desiring  to  make  a  new  direction  as  to  the  piiyment 
of  his  beneficiary  certificate  may  do  so  by  authorizing  such  change 
in  writing  on  the  back  thereof  in  the  form  prescribed,  attested  by 
the  recorder,  seal  of  lodge  attached,  and  delivery  of  his  certificate 
and  payment  of  fifty  cents  to  the  recorder,  whereupon  the  change 
shall  at  once  take  effect.  The  recorder  shall  thereupon  make  a  record 
thereof  and  report  same  to  the  Grand  Recorder,  forwarding  the 
fifty  cents  and  the  certificate.  The  Grand  Recorder  shall  thereupon 
issue  a  new  certificate  as  directed,  bearing  the  same  number  and 
conditions  as  the  old." 

Shortly  before  the  member's  death  he  signed  a  document  changing 
the  beneficiary  which  was  attested  by  the  recorder,  and  sealed  with 
the  lodge  seal.  The  instrument  was  on  a  form  furnished  by  the 
recorder  but  was  not  the  one  usually  employed  in  making  changes 
of  beneficiaries.  The  insti'ument  was  delivered  td  the  recorder  and 
the  fee  paid.     It  was  held  that  the  change  was  substantially  in  com- 


528  FRATERNAL    mCIETY    LAW 

pliance  with  the  laws,  and  that  it  was  a  valid  designation  of  the  new 
beneficiary. 

Schoenau  vs.   Grand  Lodge  A.   O.   U.   W.,   January,   1902,   85   Minn. 
349;  88  N.  W.  999. 

Beneficiary — No  Interest  in  Contract  Before  Maturity. 

The  certificate  of  membership  together  with  the  constitution  and 
by-laws  of  the  society  constitute  the  contract  between  the  member 
and  the  society.  This  is  a  contract  in  which  the  beneficiary  has  no 
part  until  after  the  maturity  of  the  certificate,  and  the  provisions 
of  the  laws  respecting  the  changing  of  beneficiaries  are  held  to  be 
made  for  the  protection  of  the  society  and  to  enable  the  member  to 
express  his  will  and  intention  and  that  such  provision  may  be  waived 
or  varied  by  the  society  in  order  to  accomplish  that  result. 

Schoenau  vs.  Grand  Lodge  A.  O.  U.  W.,  January,  1902,  85  Minn.  349; 
88  N.  W.  999. 

Beneficiary — Vested  Interests. 

The  beneficiary  named  in  a  certificate  issued  by  a  fraternal  society 
has  no  vested  interest  therein  but  a  mere  expectancy  liable  to  be 
terminated  at  any  time  by  the  will  of  the  member. 

Schoenau  vs.  Grand  Lodge  A.  0.  U.  W.,  January,  1902,  85  Minn.  349; 
88  N.  W.  999. 

Forfeiture— Reinstatement. 

The  laws  of  the  society  provided  that  membership  certificates 
should  become  void  on  the  member's  failure  to  pay  assessments  when 
due  without  regard  to  notices  of  delinquency  and  that  such  member 
.should  stand  suspended  until  reinstated  by  payment  of  all  delinquent 
amounts  and  the  furnishing  of  a  health  certificate.  A  member  carry- 
ing a  contract  under  these  laws  failed  to  make  the  payments  re- 
quired, hoAvever,  he  subsequently  made  the  iiaymeuts,  but  did  not 
furnish  a  health  cortifi(';it<'.     Tl  w;is  held  Ih.i1  1li(>  receipt  of  the  jimv- 


THE    STATE    OF    MINNESOTA  529 

mollis  thus  niadp  in  dpfinilt  upon  iMiinlil  ion  liy  the  sofiety  that  such 
payiiicnts  would  he  held  subject  to  the  reinstatement  of  the  member, 
while  waitin;^'  for  the  health  eerlilieate.  did  not  operate  to  restore 
the  member  to  uood  slandint;. 

Bowlin  vs.  Woodmen  of  the  World,   Feb.   1901.  82  Jlinn.   411;    81  N. 
W.  160. 

Right  to  Establish  Classes. 

As  to  the  right  of  an  as.sessment  society  to  establish  classes,  see 
discussion  contained  in  the  t'ollowiiiii'  case: 

Ebert  vs.  Mutual  Reserve  Fund  Life  Association,  August,  1900;    81 
Minn.  116. 

Amendments  by  Boards  of  Directors. 

A  society  was  organized  in  New  York  for  the  purpose  of  conduct- 
ing a  life  insurance  business  upon  the  co-operative  or  assessment 
plan.  The  ciuestion  arose  under  the  policy  issued  in  the  society  as 
to  the  right  of  the  board  of  directors  to  change  the  rates  of  con- 
tribution of  members  and  plans  of  business  of  the  society.  The 
Court  said  : 

"It  is  evident  that  the  contract  contemplated  an  unsettled  and 
varient  death  fund,  from  which  to  pay  death  claims,  and  that  the 
amount  of  the  assessments  would  vary  according  to  the  number  of 
deaths,  the  growth  of  the  association  in  membership  and  earning 
capacity  of  the  reserve  fund.  It  is  also  clear  that  the  law  of  self- 
preservation  applied,  and  if  at  any  time  in  order  to  meet- maturing 
claims  it  should  become  necessary  to  levy  a  larger  amount  than  that 
stipulated  as  the  maximum  rate  of  the  table,  the  power  so  to  do  was 
inherent  in  the  association  and  the  directors  would  have  authority 
to  pass  suitable  rules  and  regulations  for  that  purpose." 

The  Court  declared  that  the  society  at  bar  was  not  a  fraternal 
beneficiary  society. 

Ebert  vs.  Mutual  Reserve  Fund  Life  Assn..  August.  1900,  81  Minn. 
116. 
34 


530  FRATERNAL   SOCIETY   LAW 

Waiver— Custom  Does  Not  Waive  Laws. 

The  by-laws  of  a  society  required  payments  to  be  made  on  or  be- 
fore the  28th  day  of  the  month  for  which  they  were  due.  It  ap- 
peared from  the  evidence  that  the  custom  or  habit  of  the  collecting 
officer  of  the  subordinate  lodge  had  been  to  allow  the  members  to 
pay  assessments  after  the  28th  of  the  month.  There  was  no  evidence 
that  the  society  had  any  knowledge  of  this  custom.  The  collecting 
officer  had  no  duty  other  than  to  receive  payment  and  to  make  report 
of  the  fact  of  payment  and  to  turn  the  money  over  to  the  society. 
The  Court  held  that  inasmuch  as  the  society  had  strictly  complied 
with  all  of  its  laws,  so  far  as  the  evidence  of  the  ease  showed,  and 
that  the  only  dereliction  consisted  in  the  default  of  the  nu'mber  and 
of  the  collecting  officer,  knowledge  of  which  default  was  not  brought 
home  to  the  society,  it  could  not  be  claimed  that  the  society  had 
waived  its  laws.    The  Court  said: 

"A  compliance  with  the  terms  of  a  contract  cannot  be  termed  or 
converted  into  a  waiver." 

Elder  vs.  Grand  Lodge  A.  O.  U.  W.,  May,  1900,  79. Minn.  468. 

Waiver  of  Laws — Assignment  of  Benefits. 

The  by-laws  of  a  society  provided  against  the  assignment  of  more 
than  half  of  the  amount  of  the  benefit  certificate.  In  a  case  arising 
where  the  whole  of  the  certificate  had  been  assigned,  the  Court  held 
upon  the  facts  proven  that  the  society  had  waived  the  ju-ovisioii  of 
its  by-laws. 

Swedish    Christian   Mission    Society   vs.    Lawrence.    February.    1900, 
79  Minn.  124. 

Beneficiary — Eligibility  of  Stranger. 

An  unmarried  man  of  the  name  of  ]\Iaguire  was  a  lucinhcr  of  a 
society,  holding  a  certificate  payal)le  to  ■'his  cousin,  11.  11.  Ui-ulici-." 
Payment  of  the  certificate  was  refused  liy  the  society,  it  .ille-iiiL:-  as 
reason  llierel'oi-  that  Cruber  was  not  a  cousin  of  the  meiiiher  aiul  was 
not  eliiiilile  to  lie  iiMiiiod  as  tlu'  lieiu'ficiary.  that  he  was  iieitlu-r  re- 


FRATERNAL    SOCIETY    LAW  o31 

lated  to  the  member  nor  a  member  of  his  family  nor  dependent  upon 
him.  It  was  conceded  that  the  contention  of  the  society  in  reference 
to  the  relationship  of  (li-nber  to  tlie  member  was  correct.  The  by- 
laws in  force  and  which  were  construed  l)y  the  Court  jirovided  that 
benefits  should  be  paid. 

"To  the  person  designated  in  the  certificate  when  designated  by 
name  and  a  person  related  to  the  deceased  or  a  member  of  his  fam- 
ily or  dependent  upon  him.'-' 

The  Court  held  that  the  by-law  did  not  prohibit  Maguire  from 
designating  a  person  not  related  to  him  as  a  beneficiary  and  that 
unless  Gruber  was  entitled  to  the  fund  it  would  forfeit  to  the  society; 
jind,  further,  that  the  society  had  assented  to  the  designation  of 
Gruber  by  the  issuance  of  the  certificate  in  question,  and  that,  there- 
fore, Gruber  was  entitled  to  the  fund. 

Gruber  vs.  Grand  Lodge  A.  0.  U.  W..  February,  1900,  79  Minn.  59. 

After-enacted  Laws — Must  be  Reasonable. 

A  nu'niljcr  in  his  application  agreed  to  be  bound  "with  the  laws, 
rules  and  regulations  now  governing  this  order  or  that  may  be  here- 
after enacted  for  its  government."  At  the  time  when  this  applica- 
tion was  made  and  certificate  issued  thereon  to  the  member,  it  was 
the  duty,  under  the  laws,  of  the  Supreme  Reporter  to  determine  on 
the  20th  day  of  each  month  the  luuuher  of  assessments  which  would 
be  needed  to  provide  for  aud  pay  death  claims  duly  proven  or  regis- 
tered for  the  coming  month  and  to  levy  the  assessments  so  deter- 
mined, of  which  levy  he  was  to  give  immediate  official  notice  to  each 
subordinate  lodge.  This  levy  was  in  anticipation  of  deaths  and  evi- 
dentl.v  the  intention  was  thus  to  hasten  ]iayment  of  claims.  Under 
the  laws  in  force  at  the  time  of  the  i.ssuance  of  the  certificate  in  ques- 
tion, the  Court  found  that  the  member  w-as  entitled  to  notice  of  as- 
sessments. Subsequently  the  laws  were  amended  by  which  it  Avas 
the  duty  of  the  member  to  make  f<tip\ibiti'd  payments  without  the 
necessit.v  of  personal  notice.  With  respect  to  the  legality  of  the 
amended  laws  and  their  applicability  to  the  contract  in  question,  the 
Court  said : 


532  FRATERNAL    SOCIETY   LAW 

"The  rights  of  members  in  these  associations  must  of  course  de- 
pend upon  the  articles  or  by-laws  to  which  all  members  assent  when 
becoming  such,  and  generally  speaking,  the  same  body  which  is  au- 
thorized to  make  by-laws  can  change,  amend  or  repeal  those  already 
made.  To  this  Thibert  agreed  when  he  joined.  But  the  changes, 
amendments  aud  repeals  are  subject  to  the  restrictions  and  limita- 
tions of  the  by-laws  themselves  as  well  as  those  of  the  charter  or 
articles  of  association  and  are  also  subject  to  the  imi)lied  condition 
of  being  reasonable." 

The  Court  held  that  the  amended  law  as  to  the  member  in  question 
was  unreasonable. 

Thibert  vs.   Supreme  Lodge  Knights  of  Honor,  December,   1899,  78 
Minn.  448. 

Forfeitures — Estoppel  by  Course  of  Dealing. 

With  regard  to  the  methods  of  eondneting  the  business  of  the  so- 
cietj-  and  declaring  forfeitures  of  members  for  non-payment  of  their 
assessments,  the  Court,  after  ascertaining  the  facts  in  a  given  case 
upon  which  it  held  against  the  theory  of  fin-feiture  made  the  fol- 
lowing statement : 

■'But  the  defendant  could  not  by  its  acts  or  course  of  conduct 
or  by  showing  rei-cints  whicli.  to  say  the  least  for  them,  were  in- 
sufficient to  put  an  ordinary  man  upon  his  guard,  or  by  a  system  of 
book-keeping  of  which  complainant  had  no  knowledge,  mislead  him 
in  regard  to  the  necessity  of  prompt  payment  of  his  monthly  dues  or 
create  the  belief  on  liis  part  that  a  strict  compliance  with  the  letter  of 
his  contract  was  unnecessary,  aud  then  take  advantage  of  its  own 
misconduct." 

Richwine  vs.  La  Crosse  Mutual  Aid  Assn.,  .June,  1899,  76  Minn.  117. 

Forfeitures — Advance  Assessments . 

A  member  of  the  National  Union  made  all  payments  required  of 
him  under  his  memlxTshij)  until  April,  ISOfi.  Two  assessments  were 
levied   I'oi-  tli;i1    monlli.   Init   tln'  nn'mluT  did    nol    p;iy  iMlhcr  one  nor 


THE    HTATE    OF   MINNESOTA  533 

l-rs|)iiii(l  1(1  ;i  jKilicc  si'lil  liiiii  Id  llir  cliCcct  lliat  he  liiul  lifcii  siis|iciiiIim! 
;iii(l  .stating  the  terms  ii|)Oii  wliidi  In-  iniglit  he  reiiistatetl.  Tlie  iiieiii- 
her  died  in  the  November  followino  and  suit  was  brought  for  the 
amount  of  the  certifieatc.  In  passing  upon  the  propriety  of  issuing 
notiec  of  assessments  and  levying  assessments  to  i)ay  aeeruing  or 
I'litiife  claims,  the  Court  said: 

■'An  association  of  tliis  character  could  not  establish  a  bcnelit  fund 
noi-  could  it  pay  out  within  a  certain  number  of  days  after  ])roof, 
nor  could  it  even  transact  business  pniperly  if  after  death  claims 
have  been  established  provision  for  payment  thereafter  must  be  made 
upon  members.  From  all  of  the  provisions  of  the  laws  under  which 
the  association  acts  it  is  clear  that  the  secretary  is  to  make  all  issess- 
ments,  and  that  in  a  reasonable  manner  lie  may  anticipate  and  pro- 
vide for  the  payment  of  claims  for  deaths  which  have  occurred,  and 
the  presumption  is  that  the  condition  of  the  treasury  demanded  that 
two  assessments  be  made  on  April  10th." 

Bridges  vs.  National  Union,  August,  1898,  73  Minn.  486. 

Age — Waiver  of  Laws — Misrepresentation. 

The  articles  of  incorjioration  of  a  society  ju'ovided  that  persons 
over  65  years  of  age  should  not  be  admitted  to  membership.  The  by- 
laws adopted  by  the  society  provided  that  persons  over  55  years  of 
age  should  not  be  admitted  to  membership.  An  applicant  for  mem- 
bership represented  that  he  was  5:i  \ears  of  age  on  the  date  of  his 
application,  when  in  fact  he  was  57  years  of  age.  He  was  admitted, 
and  made  all  payments  required  of  him.  Under  the  particular  facts 
in  the  ease  the  Court  held  that  the  society  had  waived  the  misrepre- 
sentation because  of  it  having  received  knowledge  of  the  misstate- 
ment of  the  age  of  the  member  and  that  the  society  had  power  to 
waive  its  by-law. 

Wiberg  vs.  Minnesota  Scandinavian  Assn.,  July.  1898,  73  Minn.  297. 


534  FRATERNAL    SOCIETY    LAW 


THE 

STATE   OF  MISSISSIPPI. 

CHAPTER  25. 

There  is  uo  separate  Fraternal  Code  iu  the  laws  of  Mississippi, 
but  certain  sections  in  the  general  insurance  code  apply  to  Fraternal 
rfoeieties  in  express  terms  while  others  seem  to  have  indirect  appli- 
cation. All  sections  of  the  insurance  code  as  revised  in  1906  which 
affect  Fraternal  Societies  in  any  respect  are  herein  incorporated, 
with  section  numbers  corresponding  to  those  in  the  Revised  Statutes. 

Department  of  Insurance  Created. 

Section  2550.  There  is  hereby  established  in  this  State  a  separate 
and  distinct  department  of  insurance,  which  shall  be  charged  with 
the  execution  of  all  laws  now  in  force  or  which  may  be  enacted 
hereafter,  relative  to  all  insurance,  including  indemnity  or  guarantee 
and  other  companies,  corj)orations,  associations  or  orders  placed 
under  this  department. 

Insurance  Commissioner. 

Section  2451.  The  chief  officer  of  said  department  shall  be  de- 
nominated the  commissioner  of  insurance,  who  shall  be  elected  at  the 
general  election,  as  other  State  officers,  and  who  shall  possess  the 
same  qualifications  as  required  for  the  secretary  of  State.  No  per- 
son shall  be  commissioner  of  insurance  who  is  in  any  way  con- 
nected with  the  management  or  control  of  any  company,  corporation, 
association  or  order  affected  by  this  chapter,  and  his  term  of  office 


THE    STATE    OF   MISSISSIPPI  535 

sliiill  immediately  cease  if  at  any  time  he  shall  become  so  interested; 
otherwise  the  term  of  office  shall  be  four  years,  as  that  of  other  State 
officials.  Before  entering  upon  the  discharge  of  his  duties  the  com- 
missioner shall  take  the  oath  of  office  required  of  State  officers,  and 
give  a  bond  in  favor  6f  the  State  in  the  penalty  of  ten  thousand  dol- 
lars, with  some  guarantee  company  or  companies  authorized  to  do 
business  in  this  State,  to  be  approved  by  the  governor,  conditioned 
for  the  faithful  performance  of  the  duties  of  said  office  during  his 
term,  which  bund  and  oath  of  office  shall  be  filed  with  the  secretary 
of  State. 

Concerns  Subject  to  Department — Access  to  Books,  Etc. 

Section  2559.  All  indemnit\-  or  guarantee  companies,  all  com- 
panies, corporations,  partnerships,  associations,  individuals  and  fra- 
ternal orders,  whether  domestic  or  foreign,  transacting  or  to  be  ad- 
mitted to  transact,  the  business  of  insurance  in  this  State,  are  insur- 
ance companies  within  the  meaning  of  this  chapter,  and  shall  be 
subject  to  the  inspection  and  supervision  of  the  commissioner. 
Wlienever  he  shall  deem  it  proper  he  shall  personally,  or  by  deputy, 
or  agent,  make  a  careful  examination  of  them.  He  shall  have  author- 
ity to  administer  oaths,  to  subpoena  and  examine  under  oath  the 
assured,  and  the  directors,  officers,  agents  or  trustees  of  such  com- 
panies, and  to  compel  the  production  for  his  examination  of  all 
books  and  papers  pertaining  to  their  business  or  that  of  their 
agents. 

Reports  on  File — Permanent  Record. 

Section  2560.  The  commissioner  shall  keep  in  his  office  for  public 
inspection  all  reports  received  by  him;  a  record  of  all  his  proceed- 
ings, including  a  concise  statement  of  the  resiilt  of  official  examina- 
tions, an  exhibit  of  the  financial  conditions  and  business  methods  of 
all  companies  under  his  supervision,  as  disclosed  by  their  statements, 
or  by  official  examination ;  and  such  other  information  with  regard 
to  them  as  he  may  deem  it  proper  to  preserve. 


536  FRATERNAL    SOCIETY    LAW 

Failure  to  Comply,  Etc. — Notice  to  Attorney-General. 

Section  2561.  Whenever  it  shall  appear  to  the  commissioner  from 
anj-  report  submitted  or  examination  made  under  the  provisions  ot 
this  chapter  or  otherwise,  that  any  of  said  companies  or  orders  has 
failed  to  comply  with  the  law,  or  if  it,  its  officers  or  agents,  refuse  to 
submit  to  examination  or  to  perform  any  legal  obligations  in  relation 
thereto,  or  that  its  condition  is  such  as  to  render  its  further  proceed- 
ing hazardous  to  the  public  or  its  stockholders  or  policy-holders,  it 
shall  be  the  duty  of  the  attorney-general  or  the  district  attorney 
under  his  direction,  on  notice  by  the  commissioner,  to  institute  such 
proceedings  as  are  authorized  by  law  and  to  prosecute  the  same  to 
final  judgment,  and  the  commissioner  shall  also  revoke  or  suspend 
all  certificates  of  authorit}^  granted  to  such  concern  or  its  agents  to 
do  business  in  this  State,  as  hereinafter  provided. 

Terms  Defined. 

Section  2562.  When  consistent  with  the  context  and  not  obviously 
used  in  a  difl'erent  sense,  the  term  "company"  or  "insurance  com- 
pany," as  used  herein,  includes  all  corporations,  associations,  part- 
nerships or  individuals  engaged  as  principals  in  the  business  of  in- 
surance or  guaranteeing  the  obligations  of  others;  the  word  "domes- 
tic" designates  those  companies  incorporated  or  formed  in  this 
State  and  with  home  offices  therein;  and  the  word  "foreign"  when 
used  without  limitation,  includes  all  those  formed  by  authority  of 
any  other  State  or  government,  and  whose  home  office  is  not  located 
in  this  State. 

What  is  Insurance — Situs  of  Contract. 

Section  2563.  A  contract  of  insurance  is  an  agreement  by  which 
one  party  for  a  consideration  promises  to  pay  money  or  its  equiva- 
lent or  to  do  some  act  of  value  to  the  assured,  upon  the  destruction, 
loss  oi-  injury  of  something  in  wliicli  the  assured  or  other  i)arty  has 
an  interest,  as  an  indenuiity  therefor;  and  it  shall  be  vuilawful  for 
»any  company  to  make  any  contract  of  insurance  upon,  or  concerning 
any  property  or  interest  or  lives  in  this  State,  or  with  any  resident 


THE    STATE    OF    MISSISSIPPI  537 

thereof;  or  for  any  person  as  insurance  agent  or  insurance  broker 
to  make,  negotiate,  solicit,  or  in  any  manner  aid  in  the  transaction 
of  sucli  insurance  unless  and  except  as  authorized  under  the  provi- 
sions of  this  chapter.  All  contracts  of  insurance  on  property,  lives 
or  interests  in  this  State  shall  be  deemed  to  be  made  therein. 

Examination  Before  Granting  Authority. 

Section  2564.  Before  granting  a  certificate  of  authority  to  any 
insurance  comjiany  the  commissioner  shall  be  satisfied  by  examina- 
tion that  it  is  qualified  under  the  laws  of  the  State  to  transact  busi- 
ness therein,  and  as  to  its  financial  ability  and  condition.  As  often 
as  once  in  two  years  he  shall  personally,  or  b,y  deputy  or  agent,  care- 
fully examine  the  affairs  of  each  domestic  company.    (See  Sec.  1248.) 

Examination  on  Request. 

Section  2565.  He  shall  also  make  an  examination  of  any  such 
company  whenever  he  deems  it  pimdeut  to  do  so,  or  upon  the  request 
of  five  or  more  of  the  stockholders,  policy-holders,  creditors,  or  per- 
sons pecuniarily  interested  therein,  who  shall  make  affidavit  of  their 
belief,  with  specifications  of  their  reasons  therefor,  that  such  com- 
pany is  in  an  unsound  condition. 

Examination  of  Foreign  Concerns — Access  to  Books,  Etc. 

Section  2566.  Whenever  he  deems  it  prudent  for  the  protection 
of  policy-holders  in  this  State,  he  shall  in  like  manner  visit  and 
examine,  or  cause  to  be  visited  and  examined,  by  some  competent 
person  or  persons  he  may  appoint  for  that  purpose,  any  foreign  in- 
surance company  applying  for  admission  or  already  admitted  to  do 
business  by  agencies  in  this  State,  and  such  companies  shall  pay  the 
proper  charges  incurred  in  such  examination,  including  the  expense 
of  the  commissioner  or  his  deputy  and  the  expenses  and  compensa- 
tion of  his  assistants  employed  therein.  For  the  purpose  aforesaid 
the  commissioner  or  his  deputy  or  person  making  examination  shall 
have  free  access  to  all  the  books  and  papers  of  the  insurance  com- 
pany that  relate  to  its  business,  and  to  the  books  and  papers  kept 


538  FRATERNAL    SOCIETY    LAW 

by  any  of  its  agents,  aud  may  summon  and  qualify  as  witnesses 
under  oath  and  examine  the  directors,  officers,  agents  and  trustees 
of  any  such  company  and  any  other  persons  in  relation  to  its  affairs, 
transactions  and  conditions. 

When  Authority  Suspended  or  Revoked. 

Section  2567.  If  he  is  of  opinion  upon  examination  or  other  evi- 
dence that  a  foreign  insurance  company  is  in  an  unsound  condition, 
or  if  a  life  insurance  eompanj-,  that  its  actual  funds,  exclusive  of 
its  caiiital,  are  less  than  its  liabilities,  or  if  a  foreign  insurance  com- 
pany that  it  has  failed  to  comply  with  the  law,  or  if  it,  its  officers, 
or  agents,  refuse  to  submit  to  examination  or  to  perform  any  legal 
obligation  in  relation  thereto,  he  shall  revoke  or  suspend  all  certifi- 
cates of  authority  granted  to  it.  or  its  agents,  and  shall  cause  notifi- 
cation thereof  to  l)e  published  in  one  or  more  newspapers  pulilished 
in  this  State,  and  no  new  business  shall  thereafter  be  done  by  it,  or 
its  agents  in  this  State  while  such  default  or  disability  continues, 
nor  until  its  authority  to  do  business  is  restored  by  the  commissioner. 
If,  upon  examination,  he  is  of  opinion  that  any  domestic  insurance 
company  is  insolvent,  or  has  exceeded  its  powers,  or  has  failed  to 
comply  with  any  provision  of  law  applicable  to  it,  or  that  its  con- 
dition is  such  as  to  render  its  further  proceeding  hazardous  to  the 
public  or  its  policy-holders,  he  shall  suspend  its  license,  and  if  he 
deem  it  necessary  he  shall  apply  to  a  judge  of  the  chancery  court 
to  issue  an  injunction  restraining  it  in  whole  or  in  part  from  further 
proceeding  with  its  business.  Such  judge  may,  in  his  discretion, 
issue  the  injunction  forthwith  or  upon  notice  and  hearing  thereon, 
and  after  a  full  hearing  of  the  matter  may  dissolve  or  modify  such 
injimction,  or  make  it  permanent,  and  may  make  all  orders  and 
decrees  needful  in  the  premises,  and  may  appoint  agents  or  receiv- 
ers to  take  possession  of  the  property  or  effects  of  the  company, 
and  to  settle  its  affairs,  subject  to  such  rules  and  orders  as  the  court 
may,  from  time  to  time,  i)reseribe,  according  to  the  course  of  pro- 
ceedings in  equity. 


THE    STATE    OF    MlHSIHSIl'l'l  539 

Legal  Process — Notification — Liability  of  Commissioner  for  Failure 
to  Notify. 

Section  25G9.  When  ley;il  iirocess  is  servetl  upon  the  commissioner 
as  attorney  for  a  foreign  cjiuiiiany  or  order  under  the  provisions  of 
Section  126U6,  he  shall  forthwith  notify  the  ccnnpany  or  order  of  such 
service  by  letter  prepaid  and  directed  to  its  secretary,  or,  in  the  case 
of  a  foreign  country,  to  its  resident  manager,  if  any,  in  the  United 
States,  and  shall,  -within  two  days  after  such  service,  forward  in  the 
same  manner  a  copj'  of  the  process  served  on  him  to  said  secretary 
or  manager,  or  to  such  person  as  may  have  l)een  previously  desig- 
nated by  the  company  or  order  by  written  notice  filed  in  I  he  office  of 
the  commissioner;  but  the  failure  of  the  commissioner  to  notify  the 
company  or  order  shall  not  affect  the  validity  of  such  service,  but 
shall  sulj.ject  him  to  liability  on  his  bond  for  such  damages  as  the 
comi)any  or  order  shall  suffer  thereby.  As  a  condition  of  a  valid  and 
effectual  service  and  of  the  duty  of  the  commissioner  in  the  premises, 
the  plaintiff  in  such  process  shall  pay  to  the  commissioner  at  the 
time  of  service  thereof  the  sum  of  two  dollars,  which  the  said 
plaintiff  shall  recover  as  taxable  costs  if  he  prevails  in  his  suit.  The 
commissioner  shall  keep  a  record  of  all  such  proceedings,  which 
shall  show  the  day  and  hour  of  service. 

Business  to  be  Conducted  in  Corporate  Name. 

Section  2570.  Evei"y  insurance  company,  foreign  or  domestic, 
shall  conduct  its  business  in  this  State  in  its  own  proper  and  cor- 
porate name,  and  the  policies  and  contracts  of  insurance  issued  by 
it  shall  be  headed  or  entitled  only  by  its  proper  or  corporate  name. 
When  any  such  company  publishes  its  assets,  it  shall  in  the  same 
connection  and  with  equal  conspicuousness  publish  its  liabilities 
computed  on  the  basis  allowed  for  its  annual  statements,  and  any 
publication  purporting  to  show  its  capital,  shall  exhibit  only  the 
amount  of  such  capital  as  has  actually  been  paid  in  cash. 

Laws  Applicable. 

Section  2571.    The  general  provisions  of  law  relative  to  the  powers, 


540  FRATERNAL    SOCIETY    LAW 

duties  and  liabilities  of  corporations  shall  apply  to  all  incorporated 
domestic  insurance  companies,  so  far  as  such  provisions  are  perti- 
nent and  not  in  conflict  with  other  provisions  of  law  relative  to  such 
companies,  or  with  their  charters.  All  insurance  companies  in  this 
State  shall  be  governed  by  this  chapter,  anything  in  their  special 
charters  to  the  contrary  notwith-standing. 

Continuation  After  Charter  Expires. 

Section  2572.  Domestic  insurance  companies  incorporated  by 
special  acts,  whose  charters  are  sub.ject  to  limitation  of  time,  shall, 
after  such  limitation  expire.s,  continue  to  be  bodies  corporate,  sub- 
ject to  all  general  laws  applicable  to  such  companies.  No  domestic 
in.surance  company  hereafter  organized  shall  issue  policies  until, 
upon  examination  of  the  commissioner,  his  deput}^  or  examiner,  it 
is  found  to  have  complied  with  the  laws  of  the  State,  nor  until  it 
has  obtained  from  the  commissioner  a  certificate  setting  forth  that 
fact  and  authorizing  it  to  issue  policies. 

By-Laws — Terms  of  Directors. 

Section  2573.  Any  such  corapanj-  may  adopt  by-laws  for  the  con- 
duet  of  its  business  not  repugnant  to  law  or  to  its  charter,  and 
therein  provide  for  the  division  of  its  board  of  directors  into  two, 
three  or  four  classes  and  the  election  thereof  at  its  annual  meetings 
in  such  manner  as  that  the  members  of  one  class  only  shall  retire 
and  their  successors  be  chosen  each  year.  Vacancies  in  any  such 
class  may  be  filled  by  election  by  the  board  for  the  unexpired  term. 

Real  Estate  Acquired  and  Held. 

Section  2574.  Any  such  company  may  acquire  and  linld  real  estate 
for  the  convenient  accommodation  of  its  business  at  a  cost  not 
exceeding  twenty-five  per  centum  of  its  cash  assets  and  not  other- 
wise, but  may  hold  real  estate  under  the  conditions  of  any  mortgage 
owned  by  it.  or  by  purchase  on  execution  upon  judgment  for  debts 
due  it  in  the  course  of  its  legitimate  business;  provided,  that  this 
shall  not  apply  to  any  company  which  has  already  made  investments 
in  real  estate  in  excess  of  the  provisions  of  this  section. 


THE    STATE    OF   MISSISSIPPI  541 

No  Stipulation  as  to  Jurisdiction. 

Section  2575.  No  company  shall  make  any  condition  or  stipula- 
tion in  its  insurance  contract  concerning  the  court  or  jurisdiction 
wherein  any  suit  thereon  may  be  brought,  nor  shall  they  limit  the 
time  within  which  such  suit  may  be  commenced  to  less  than  one 
year  after  the  loss  or  injury,  and  any  such  condition  or  stipulation 
shall  be  void. 

Life  Insurance  Companies  Defined. 

Section  '2d'.)S.  All  corporations,  associations,  partnerships  or  indi- 
viduals doing  busiuess  in  this  State  under  any  chartei',  contract, 
agreement  or  statute,  of  this  or  any  other  State,  involving  the  pay- 
ment of  money  or  other  things  of  value  to  families  or  representatives 
of  policy  and  certificate  holders  or  members,  conditioned  upon  the 
continuance  or  cessation  of  human  life,  or  involving  an  insurance, 
guaranty,  contract  or  pledge  for  the  payment  of  endowments  for 
annuities,  or  who  shall  employ  agents  to  solicit  such  business,  shall 
be  deemed  to  be  life  insurance  companies  and  shall  in  all  respects 
be  subject  to  the  laws  herein  made  and  provided  for  the  government 
of  life  insurance  companies,  and  shall  not  make  any  such  insurance, 
guaranty,  contract  or  pledge  in  this  State  with  any  citizen  or  resi- 
dent thereof  which  does  not  distinctly  state  the  amount  of  benefits 
payable,  the  manner  of  payment  and  the  consideration  therefor. 

Reinsurance  Regulated. 

Section  2601.  No  domestic  life  insurance  company  shall  reinsure 
its  risks  except  l)y  permission  of  the  insurance  commissioner,  but 
may  reinsure  not  exceeding  one-half  of  any  individual  risk.  No  life 
insurance  company  or  fraternal  order,  organized  vuider  the  laws  of 
or  doing  business  in  this  State,  shall  enter  into  any  contract  of  insur- 
ance upon  lives  within  this  State  without  having  previously  made  or 
caused  to  be  made  a  prescribed  medical  examination  of  the  insured 
by  a  medical  practitioner,  authorized  to  practice  medicine  by  the 
laws  of  Mississippi ;  provided,  that  this  shall  not  apply  to  policies 
not  exceeding  one  hundred  dollars  on  anv  one  life.     Anv  insurance 


542  FRATERNAL    SOCIETY   LAW 

company  or  fraternal  order  violating  this  provision,  or  any  officer, 
agent,  or  other  pei'son  soliciting,  or  effecting,  or  attempting  to  effect 
a  contract  of  insurance  contrary  thereto,  shall  be  deemed  guilty  of 
a  misdemeanor,  and  shall  be  punished  by  a  tine  not  exceeding  one 
hundred  dollars  for  each  offense. 

Amount  Exempt  to  Beneficiaries. 

Section  2602.  The  proceeds  of  a  life  insurance  policy  to  an  amount 
not  exceeding  ten  thousand  dullars  upon  any  one  life  shall  enure 
to  the  party  or  parties  named  as  the  beneficiaries  thereof  free  from 
all  liability  for  the  debts  of  the  person  whose  life  was  insured,  even 
though  such  person  paid  the  premiums  thereon. 

Amount  Exempt  to  Executor  or  Administrator. 

Section  2603.  The  proceeds  of  a  life  insurance  policy  not  exceed- 
ing five  thousand  dollars,  payable  to  the  executor  or  administrator 
of  the  insured  enure  to  the  heirs  or  legatees  freed  from  all  liability 
for  the  debts  of  the  decedent:  but  if  the  life  of  tlie  deceased  be  in- 
sured for  the  benefit  of  his  heirs  or  legatees  at  the  time  of  his  death 
otherwise-,  and  they  shall  collect  the  same,  the  sum  collected  shall  be 
deducted  from  the  five  thousand  dollars  and  the  excess  of  the  latter 
only  shall  be  exempt. 

Penalty  for  False  Statement  as  to  Publication. 

Section  2604.  Any  solicitor,  agent,  examining  ph.ysician  or  other 
person  who  shall  knowingly  or  wilfully  make  any  false  or  fraudu- 
lent statement  or  representation  in  or  with  reference  to  any  publi- 
cation for  insurance,  or  who  shall  make  any  such  statement  for  the 
purpose  of  obtaining  fee,  commission,  money  or  benefit  in  any  cor- 
poration transacting  business  under  this  chapter,  shall  be  guilty  of 
a  misdemeanor,  and  upon  conviction,  shall  be  punished  by  a  fine  of 
not  less  than  one  hundred  dollars,  nor  more  than  five  hundred  dol- 
lars, or  imprisonment  in  the  county  jail  for  not  less  than  thirty  days. 

Foreign  Companies  Admitted — Laws  Applicable  to. 

Sedion  2605.     Foreign  iiisniMncc  compimies   ii))on  coiii]ilyiiii:'  with 


THE    STATE    OF    MLSSISSIl'I'I  ^,43 

tlu'  cDiRlitioiis  lioroiii  sv\,  forlli  iipiiliciiblc  to  such  ciiiiiiuiiiii's,  iiiiiv 
be  jidiiiillcd  to  traiisiict  ill  tins  Sl;ilc  by  constituted  agents  resident 
tlicfciii,  any  class  of  insurance  authorized  by  the  laws  now  or  here- 
after in  force  relative  to  the  tlulies.  oblii:at  ions,  prohiiiit  ions  ami  the 
penalties  of  insurance  companies,  and  subject  to  all  laws  applicable 
to  the  transaction  of  such  business  by  foiviyii  uisui-ance  companies 
and  their  agents;  provided,  that  no  ]n'ovisi(ni  of  law  which  by  its 
terms  applies  specifically  to  domestic  life  insurance  companies  shall 
thereby  become  applicable  to  foreit;ii   life  insurance  companies. 

Deposit  of  Charter — Statement,  Etc. — Fee  for  Filing. 

Section  26U(J.  No  foreign  insurance,  indemnit\'  or  guarantx'  com- 
pany shall  be  admitted  and  authorized  to  do  business  in  this  State 
imtil: 

First.  It  shall  deposit  with  the  commissioner  of  insurance  a  cei'- 
tified  copy  of  its  charter  or  deed  of  settlement,  and  a  statement  of 
its  financial  condition  and  business,  in  such  form  and  detail  as  he 
may  require,  signed  and  sworn  to  by  its  president  and  seci"etary,  or 
other  proper  officer,  and  shall  jiay  for  the  filing  of  such  statement 
the  sum  of  twentj^  dollars. 

Second.  It  shall  satisfy  the  said  commissioner  that  it  is  full.y 
and  legally  organized  under  the  laws  of  its  State  or  government  to 
do  the  business  it  proposes  to  transact ;  that  it  has,  if  a  stock  com- 
pany, a  fully  paid  up  and  unimpaired  capital,  exclusive  of  stock- 
holders' obligations  of  any  description,  of  an  amount  not  less  than 
one  hundred  thousand  dollars;  and  if  a  mutual  life  insurance  com- 
pany that  its  net  cash  assets  equal  to  the  capital  required  of  like 
companies  on  the  stock  plan ;  or  that  it  possesses  net  cash  assets  of 
not  less  than  one  hundred  thousand  dollars,  or  net  cash  assets  of 
not  less  than  fifty  thousand  dollars,  with  also  invested  assets  of  not 
less  than  one  hundred  thousand  dollars,  and  in  each  case  witli  ad- 
ditional contingent  assets  of  not  less  than  three  hundred  thousand 
dollars,  and  that  such  capital  or  net  assets  are  well  invested  and  im- 
mediately available  for  the  payment  of  losses  in  this  State,  and  that 
it  insures  on  any  single  hazard  a  sum  no  larger  than  one-tenth  of  its 
net  assets. 


544  FRATERNAL    SOCIETY    LAW 

Third.  It  shall,  by  a  duly  executed  instrument  filed  in  his  office, 
constitute  and  appoint  the  commissioner  of  insurance,  and  his  suc- 
cessor, its  true  and  lawful  attorney,  upon  whom  all  process  in  any 
action  or  legal  proceeding  against  it  may  be  served,  and  therein  shall 
agree  that  any  process  against  it  which  may  be  served  upon  its  said 
attorney  shall  be  of  the  same  force  and  validity  as  if  served  on  the 
company,  and  the  authority  thereof  shall  continue  in  force  irrevo- 
cable so  long  as  any  liability  of  the  company  remains  outstanding  iu 
this  State.  The  service  of  such  process  shall  be  made  by  leaving  a 
copy  of  the  same  in  the  hands  or  office  of  the  said  commissioner. 
Copies  of  such  instrument  certified  by  the  said  commissioner  shall 
be  deemed  sufficient  evidence  thereof,  and  service  upon  such  attorney 
shall  be  deemed  sufficient  service  upon  the  princi])al. 

Fourth.  It  shall  appoint  as  its  agent  or  agents  in  this  State  some 
resident  or  residents  thereof  other  than  the  said  commissioner,  such 
appointment  to  be  made  in  writing,  signed  by  the  president  and 
secretary  or  manager  or  general  agent,  and  filed  in  the  office  of  the 
commissioner,  authorizing  the  agent  to  acknowledge  service  of 
process  for  and  on  behalf  of  the  company,  and  consenting  that  serv- 
ice of  process  on  the  agent  shall  be  as  valid  as  if  served  upon  the 
company,  according  to  the  laws  of  this  State,  and  waiving  all  claim 
of  error  by  reason  of  such  service. 

Fifth.  It  shall  obtain  from  the  said  commissioner  a  certificate 
that  it  has  complied  with  the  laws  of  the  State  and  is  authorized  to 
make  contracts  of  insurance. 

License  Revoked,  When. 

Section  2612.  The  authorit.y  of  a  domestic  or  foreign  insurance 
company  may  be  revoked  if  it  shall  violate  t)r  neglect  to  comply 
with  any  provision  of  law  obligatory  on  it.  and  whenever  iu  the 
opinion  of  the  commissioner  its  condition  is  unsound,  or  its  assets 
above  its  liabilities  exclusive  of  capital  and  inclusive  of  unearned 
premiums,  estimated  as  provided  in  Section  261.S,  are  less  llian  the 
amount  of  its  original  capital  or  required  iiniitipnircil  I'uiids. 

License  for  Twelve  Months — Fees  Prorated. 

Section  21)24.     The  licenses  required  shall  continue  for  the  next 


THE    STATE    OF    MISSISSIPPI  545 

ensuing  twelve  nioutlis  jirtcr  .MjiitIi  ]s1  oi'  (^acli  ycnr  (but  the  cora- 
niissiouer  may  receive  i'rom  applicauts  after  Marcli  1st  so  much  of 
said  license  fees  as  may  be  due  prorata  for  the  I'emaindcr  of  the 
year)  unless  revoked,  as  provided  in  this  chapter. 

License  Fees — Life,  Fire,  Accident,  Marine,  Surety,  Etc. 

Section  2629.  The  said  ('(iiiiuiissiiuicr  sliall  collect  and  pay  into 
the  State  treasury  the  following  licenses  and  taxes  which  shall  be 
in  lieu  of  all  other  licenses  and  taxes,  State,  county  or  municipal: 
For  each  license  issued  to  a  life  insurance  company  or  association, 
two  hundred  and  fifty  dollars;  for  each  license  issued  to  a  fire  insur- 
ance company  or  association,  or  to  any  company  or  association  of 
companies  operating  a  separate  or  distinct  plant  of  agencies  in  the 
State,  two  hundred  dollars;  for  each  license  issued  to  an  accident 
insurance  compan.y  or  association,  two  hundred  dollars;  for  each 
license  issued  to  a  marine  insurance  company  or  association,  two 
hundred  dollars;  for  each  license  issued  to  a  surety  insurance  com- 
pany or  association,  one  hundred  dollars;  for  each  license  issued  to  a 
plate  glass  insurance  company  or  association,  one  hundred  dollars; 
for  each  license  issued  to  all  other  insurance  companies  or  associa- 
tions, one  hundred  dollars.  All  life  insurance  companies  shall  pay 
a  tax  of  two  per  centum  upon  the  gross  amount  of  their  initial  or 
first  year  premium  receipts  in  this  State,  and  one-tenth  of  one  per 
cent  upon  renewal  premiums  on  business  thereafter  written,  and  all 
other  than  life  insurance  companies  shall  p^y  a  tax  of  two  per 
centum  on  gross,  less  return,  premiums ;  provided,  that  domestic 
insurance  companies  that  pay  an  ad  valorem  tax  to  this  State  shall 
not  be  subject  to  the  tax  herein  imposed  upon  premiums. 

Fees  for  Commissioner. 

Section  26.30.  The  commissioner  shall  also  collect  the  following 
fees,  to  be  retained  by  him  as  perquisites  of  the  office,  until  the  first 
day  of  January,  1907:  For  certificate  of  authority  to  each  general 
or  district  agent  or  manager,  three  dollars  (including  seal) ;  for 
certificate  of  authority  to  each  local  or  canvassing  agent  (including 
seal),  two  dollars:  for  filint;'  and  examining  statement  preliminary 
35 


546t'  FRATERNAL   SOCIETY   LAW 

to  admission,  twenty  dollars;  for  filing  and  auditing  annual  state- 
ment, ten  dollars;  for  copy  of  annual  statement  and  certificate 
thereto,  five  dollars ;  for  filing  any  other  paper  required  by  law,  one 
dollar;  for  each  certificate  of  examination,  condition  or  qualification 
of  company  or  association,  two  dollars ;  for  each  seal  when  required, 
one  dollar;  for  service  of  process  on  him  as  attorney,  two  dollars; 
for  each  examination  of  domestic  companies,  twenty-five  dollars  and 
actual  expenses  incurred;  for  each  examination  of  foreign  com- 
panies, twenty-five  dollars  per  diem  and  actual  expenses  incurred; 
such  examination  shall  be  made  onlj-  when  upon  request  of  the  com- 
missioner of  this  State  upon  the  iusuranee  commissioner  of  the  State 
of  the  domicile  of  a  foreign  company  shall  refuse  or  fail  to  furnish 
the  information  called  for;  but  after  January  1,  1907,  all  fees  pro- 
vided for  in  this  chapter  shall  be  paid  by  the  insurance  commissioner 
into  the  State  treasury. 

Fraternal  Orders — Fees. 

Section  2631.  For  filing  charter,  etc.,  of  fraternal  orders  doing  an 
insurance  business,  preliminary  to  admission,  twenty-five  dollars; 
for  filing  and  auditing  annual  statement,  ten  dollars.  All  other  fees 
and  charges  due  and  payable  by  any  company,  association,  order  or 
individual  in  his  department. 

Publication  Fees. 

Section  2632.  For  publication  of  annual  statement  (to  be  paid  to 
publishers),  uiue  dollars.  The  commissioner  shall  receive  for  copy 
of  any  record  or  paper  in  his  office,  ten  cents  per  hundred  words,  and 
one  dollar  for  certifying  same,  or  any  fact  or  data  from  the  records 
of  his  office. 

Orders  Exempt. 

Section  2637.  Nothing  in  this  chapter  shall  be  construed  to  extend 
to  benevolent  associations  that  levy  an  as.sessment  upon  their  mem- 
bers to  create  a  fund  only  to  pay  to  the  family  of  a  deceased  member 
and  make  no  profit  therefrom,   and   that  have  been  incorporated 


THE    STATE    OF    MISSISSIPPI  547 

under  the  laws  of  this  Stnte,  and  do  not  solicit  business  through 
agents,  except  such  parts  of  this  chapter  as  apply  to  "fraternal 
orders. ' ' 

Fraternal  Orders  Defined. 

Section  2638.  Every  incorporated  association,  order  or  society 
doing  business  in  this  State  on  the  lodge  system,  with  ritualistic 
form  of  work  and  i-(>preseutative  form  of  government,  for  the  pur- 
pose (if  mnicini;'  provision  for  Ihe  pa>-in('nl  of  ln'ni'fits  in  ease  of 
death,  sickness,  temporary  or  permanent  physic.iL  disability,  either 
as  a  result  of  disease,  accident  or  old  age,  formed  and  organized  for 
the  sole  benefit  of  its  membei's  and  beneficiaries,  and  not  for  profit, 
be  and  the  same  is  hereby  declared  to  be  a  "fraternal  order,"  and 
such  order,  society  or  association  paying  death  benefits  may  also 
create,  maintain,  apply  or  disburse  among  its  membership  a  reserve 
or  emergenc.y  fund,  as  may  li<'  provided  in  its  constitution  or  by- 
laws: provided,  however,  that  no  profit  or  gain  shall  be  added  to  the 
payment  made  by  a  member;  and  that  any  incorporated  order,  asso- 
ciation or  society,  not  doing  business  on  the  lodge  system,  with 
rituiilistie  form  of  work,  which  is  so  conducted  as  to  make  it  n  fra- 
ternal beneficiary  order,  society  or  association  within  the  true  mean- 
ing of  this  chapter,  aiul  shall  show  it  to  the  satisfaction  of  the  com- 
missioner, shall  be  permitted  to  do  Inisiness  in  this  State  upon  com- 
pliance with  the  laws  applicable  to  "fraternal  orders." 

Funds  Derived  from  Assessments,  Etc. 

Section  2639.  The  fund  from  which  the  pa.vment  of  benefits,  as 
provided  for  in  the  preceding  section,  shall  be  made,  and  the  fund 
from  which  the  expenses  of  said  association  shall  be  defrayed,  shall 
be  derived  from  assessments  or  due  collected  from  its  members. 
Such  societies  or  associations  shall  be  governed  by  the  provisions  of 
this  chapter  governing  "fraternal  orders." 

Report  to  Commissioner — Publication. 

Section  2640.     Such  societies  or  associations  doing  Imsiness  in  this 


548  FRATERXAL    SOCIETY    LAW 

State  shall,  on  or  before  the  tirst  day  of  March  of  each  year,  make 
and  file  with  the  commissioner  of  insurance  and  banking  a  report 
of  its  affairs  and  operations  during  the  year  ending  on  the  31st  day 
of  December  immediately  preceding,  together  with  a  copy  of  its  con- 
stitution and  laws  then  in  force.  Such  report  shall  be  on  blanks  pro- 
vided by  the  commissioner,  and  shall  be  verified  under  oath  by  the 
duly  authorized  officer  or  officers  of  such  societ.v  or  association,  and 
shall  contain  such  information  as  the  commissioner  may.  in  his  judg- 
ment, deem  necessary  for  the  welfare  of  the  people  of  this  State,  and 
shall  be  published,  or  the  substance  thereof,  in  the  annual  report  of 
the  commissioner  under  a  separate  head  and  entitled  "Fraternal 
Orders ; ' '  and  for  the  filing  of  said  report  said  society  or  associatiou 
sluill  pay  a  fee  of  ten  dollars  and  costs  of  publication. 

Where  Meetings  Held. 

Section  2641.  Any  such  societies  incorporated  and  organized 
under  the  laAvs  of  this  State  may  provide  for  the  meeting  of  its 
supreme  legislative  or  governing  body  in  any  other  State,  province 
or  territory  wherein  said  society  shall  have  subordinate  lodges,  and 
all  business  that  has  been  heretofore  or  may  hereafter  be  transacted 
at  such  meetings  shall  be  as  valid  in  all  respects  as  if  such  meeting 
were  held  within  the  State;  provided,  however,  that  the  principal 
business  office  of  such  society  shall  always  be  kept  Avithin  this  State 
and  never  removed  therefrom. 

Domestic  and  Foreign  Orders,  How  Admitted. 

Section  2642.  Any  such  fraternal  order  as  is  defined  py  this  act. 
chartered  and  organized  in  this  State,  or  organized  and  doing  busi- 
ness under  the  laws  of  another  State,  district,  province  or  territory, 
may  be  admitted  to  transact  business  in  this  State  u]ion  the  same 
conditions  as  are  prescribed  in  Section  2606.  sub-section  one.  two. 
three,  five;  provided,  that  the  fees  therefor  shall  Ix'  twenty-five 
dollars,  and  such  order  shall  not  be  required  to  have  the  capital 
specified  in  said  section. 


THE    STATE    OF    MtflSISSIPPI  549 

Penalty  for  Failure  to  File  Statement  and  Making  False  Returns. 

S('ctii)ii  26-1(3.  Any  coinpiiiiy  thai  ni'ulccts  I1)  iiKikc  and  (ili-  its 
aiiiiiial  .statement  witliin  the  linii'  pi-dxiili'd  in  tliis  diaiitci-.  shall  pay 
to  th(>  State  of  Mississippi  one  liundred  dollai's  I'or  each  (la \- 's  neg- 
lect, and  npon  notiee  b\-  the  eomniissioner  to  that  effeet,  its  authority 
to  do  new  business  shall  cease  while  such  default  continues.  For 
wilfully  making  a  false  annual  or  other  statement,  it  is  required  by 
law  to  make,  any  insurance  company,  association  or  order,  aiul  the 
person  making  oath  to,  or  subscribing  the  same,  shall  severally  be 
guilty  of  a  misdemeanor,  and.  upon  conviction,  bo  punished  by  a  fine 
of  not  less  than  five  hundred  nor  more  than  one  thousand  dollars. 
Any  person  making  oath  to  such  false  statement  shall  be  guilty  of  the 
crime  of  perjury. 

Life  Companies — Application  of  Insured  to  be  Filed  With  Policy  of 
Insurance. 

Section  2675.  All  life  insurance  companies  doing  business  in  the 
State  of  Mississippi  shall  deliver  to  the  insured  with  the  policy,  cer- 
tificate or  contract  of  insurance  in  any  form  a  copy  of  the  insured's 
application,  and  in  default  thereof  said  life  insurance  company  shall 
not  be  permitted  in  any  court  of  this  State  to  deny  that  any  of  the 
statements  in  said  application  are  true. 

Misstatement  of  Age  Not  to  Invalidate  Policy. 

Section  2676.  That  any  misstatement  of  age,  in  any  policy,  cer- 
tificate or  contract  of  life  insurance  in  any  form,  shall  not  invalidate 
said  policy,  certificate  or  contract  of  life  insurance,  but  in  such  a  case 
when  a  loss  occurs  the  beneficiaries  shall  recover  on  said  policy,  cer- 
tificate or  contract  of  insurance  such  an  amount  of  insurance  as  the 
premiums  paid  would  have  purchased  for  the  insured  at  his  actual 
age,  reckoning  according  to  the  rate  tables  of  said  insurance  com- 
pany. 


550  FRATERNAL    SOCIETY    LAW 

Liberal  Construction  in  Favor  of  Contract. 

The  laws  of  a  society  are  to  be  liberally  constnu'd  in  favor  of  the 
insured,  so  as  to  prevent  a  forfeiture. 

Morgan  vs.  Independent  Order  Sons  and  Daughters  of  Jacob,  October, 
1907,  Supreme  Court  of  Mississippi,  44  So.  791. 

Cannot  Contract  Against  Estoppel. 

Fraternal  societies  are  subject  to  the  same  rules  (if  law  that  govern 
other  life  insurance  companies,  except  so  far  as  such  rules  may  be 
lawfully  modified  by  the  objects  and  purposes  of  the  organization, 
and  no  company  or  society  can  exempt  itself  in  advance  by  contract 
or  law  from  an  estoppel  to  assert  a  forfeiture  of  a  policy  when  there 
has  been  a  breach  of  conditions  on  the  part  of  the  member,  and 
the  society's  conduct  has  been  such  as  to  induce  the  belief  that  the 
forfeiture  was  waived. 

Morgan  vs.  Independent  Order  Sons  and  Daughters  of  Jacob.  October 
1907,  Supreme  Court  of  Mississippi,  44  So.  791. 

Conditions  Precedent — Medical  Examiner's  Approval. 

An  application  for  membership  was  made,  but  the  supreme  medi- 
cal examiner  did  not  pass  upon  the  application  until  after  the  mem- 
ber's death,  and  then  it  was  disapproved.  The  laws  of  the  society 
provided  that  the  approval  of  the  medical  examiner  should  be  a 
condition  precedent  to  liability.  Held  that  no  contract  had  been 
made. 

Brotherhood  of  Locomotive  Firemen  vs.  Hand,  June.  1907.  Supreme 
Court  of  Mississippi,  44  So.  161. 

Resort  to  Civil  Courts. 

Where  the  laws  of  a  society  provide  for  appeals  within  the  society 
for  the  purpose  of  correcting  all  erroneous  or  complained  of  de- 
cisions, a  member  is  bound  to  exhaust  his  remedies  so  jirovided  be- 
fore applying  In  the  courts  for  relief. 


THE    STATE    OF    MISSISSIPPI  551 

Ward  vs.   David  and  Jonathan   Lodge,  March,  1907,   Supreme  Court 
of  Mississippi,  43  So.  302. 

After-Enacted  Laws  Binding. 

An  after-enacted  by-law  i)rovided  for  a  compulsory  insurance  de- 
partment, the  payment  of  $1.00  per  month  by  all  members,  and  pro- 
viding that  meml)ers  who  did  not  pay  this  sum  should  not  be  per- 
mitted to  meet  with  the  lodge.  This  by-law  was  held  to  apply  to 
members  in  the  society  as  well  as  those  that  might  come  in  sub- 
sequently. 

Ward  vs.   David  and  Jonathan  Lodge,  March,  1907,  Supreme  Court 
of  Mississippi,  43  So.  302. 

Coerced  Marriage — ' '  Widow. ' ' 

A  society  agreed,  by  its  contract,  to  pay  to  the  member's  "widow 
or  other  heirs,"  and  it  was  held  that  where  a  member  had  been 
coerced  into  a  marriage,  and  never  thereafter  visited  or  cohabited 
with  his  pretended  wife,  that  she  was  not  the  widow  within  the  terms 
of  the  contract. 

Grand   Lodge   vs.    Smith,   Oct..   1906,   Supreme  Court   of  Mississippi, 
42  So.   89. 

Beneficiary — Disposition  by  Will. 

A  certificate  issued  was  payable  to  a  member's  "widow  or  other 
heirs,"  a  section  of  the  laws  of  the  society  provided  that  benefits 
should  go  to  the  "widow,  heirs  or  other  legal  representatives."  The 
member  attempted  by  a  will  to  dispose  of  the  benefit.  It  was  held 
that  he  could  not  do  so,  but  that  the  widow  was  entitled  to  the  fund. 

Tutt  vs.  Jackson,  Nov..  1905,  87  Miss.  207;  39  So.  420. 

State  Statutes  Control  Certain  Societies. 

The  statutes  of  a  State  imposing  restrictions  upon  insurance  com- 
panies, requiring  them  to  obtain  permits  from  the  insurance  depart- 


552  FRATERNAL    SOCIETY    LAW 

ment  before  being  permitted  to  do  business  in  the  State,  was  held 
to  apjily  to  a  society  which  issued  contracts  in  consideration  of 
weekly  dues,  whereby  it  agreed  to  pay  its  members  a  stipulated  sum 
during  illness  and  certain  other  sums  to  a  designated  beneficiary  to 
be  expended  in  burying  the  member,  such  a  society  was  held  to  be 
an  insurance  company. 

Fikes  vs.  The  State,  Nov.,  1905,  S7  Miss.  251;  39  So,  7S3. 

Contract — Minds  of  Parties  Must  Meet. 

Propositions  and  counter  propositions  do  not  make  a  contract ;  be- 
fore either  party  is  bound,  the  proposition  of  one  of  them  must  be 
accepted  by  the  other  exactly  as  proposed.  There  must  be  a  meeting 
of  the  minds  on  the  same  thing,  and  this  rule  applies  in  the  making 
of  insurance  contracts  as  much  as  in  any  other  contract. 

New  York  Life  Insurance  Co.  vs.  Mcintosh,  April,  1905,  86  Miss.  236. 

After-enacted  Laws — Members  Receive  Benefits  of. 

Where  a  member  has  agreed  to  be  bound  by  the  constitution,  and 
such  by-laws  as  are  in  force  or  may  hereafter  be  enacted,  he  is 
held  to  be  entitled  to  all  the  advantages  and  changes  in  its  laws,  as 
well  as  being  bound  to  submit  to  the  burdens  thereby  imposed. 

Sovereign  Camp  Woodmen  ot  the  World  vs.  Woodruff.  March,  1902, 
80  Miss.  546. 

Laws  Are  Considered  Written  Into  Contract. 

All  laws  of  a  society  in  force  at  the  date  of  the  member's  certifi- 
cate, are  to  be  considered  as  Avritten  into  the  certificate,  and  all 
amendments  thereafter  made  which  govern  and  control  the  member's 
rights,  or  fix  the  societj^'s  liability  on  the  contract  issued. 

Sovereign  Camp  Woodmen  of  the  World  vs.  Woodruff,  March,  1902, 
80  Miss.  546. 


THE    STATE    OF    MISSISSIPPI  553 

After-enacted  Laws — Members  Receive  Benefits  of  and  Are  Bound 
By. 

A  member  in  his  application  agreed  in  accordance  with  the  re- 
quirements of  the  laws  that  if  he  had  not  been  vaccinated,  he  would 
waive  all  claims  under  his  certificate  in  favor  of  his  beneficiary 
shim  Id  he  (lie  from  smallpox.  Subsequently  the  laws  of  the  society 
were  so  changed  as  to  require  members  who  had  not  been  vaccin- 
ated to  agree  that  until  they  were  successfully  vaccinated,  they 
would  waive  all  claims  under  their  certificates  in  favor  of  their  bene- 
ficiaries in  case  they  died  from  smallpox.  The  member  in  question 
was  successfully  vaccinated,  but  subsequently  died  of  smallpox,  and 
it  was  held  thei-e  was  no  defense  to  the  claim  of  the  beneficiary  that 
could  be  asserted  under  the  laws  in  force  prior  to  the  amendment 
and  that  the  member  and  his  beneficiary  were  entitled  to  the  benefits 
conferred  by  the  amendment. 

Sovereign  Camp  Woodmen  of  the  World  vs.  Woodruff,  March,  1902, 
80  Miss.  546, 

Lodge  Property  Subject  to  Taxation — "Charity." 

A  subordinate  lodge  of  the  Independent  Order  of  Odd  Fellows, 
owned  certain  property  and  claimed  that  the  property  was  exempt 
from  taxation  under  the  Code  which  in  language  exempts  all  prop- 
erty, real  or  personal,  belonging  to  any  charitable  society,  used  ex- 
clusively for  the  purposes  of  such  society  and  not  for  profit.  Part  of 
the  property  was  rented  but  it  was  claimed  that  the  income  was 
used  for  charity  by  the  lodge.  A  large  part  of  the  funds  of  the 
lodge  were  used  for  sick  and  burial  benefits  to  members  of  the 
society,  and  the  Court  said  to  this  extent  the  funds  were  not  used 
for  charity  and  that  the  property  was  sub.iect  to  taxation. 

Ridgley  Lodge  vs.  Redus,  Oct.,  1900,  78  Miss.  352. 

Limitations  of  Law  Presumed  to  be  Known. 

Strangers  as  well   as  members  of  a  society  are   charged  with  a 


4  FRATERNAL    SOCIETY    LAW 

knowledge  of  a  provision  in  a  public  law  to  the  effect  that  benefits 
can  only  be  paid  to  particular  classes  of  persons. 

■  Rose  vs.  Wilkins,  Oct.,  1900,  78  Miss.  401. 

Right  of  Stranger  to  Recover  in  Equity  for  Money  Paid  Under  Cer- 
tificate. 

A  stranger  who  makes  payments  on  a  certificate  for  a  member  to 
keep  the  same  in  force,  may  after  the  death  of  the  member  recover 
the  amount  so  paid  with  legal  interest,  from  the  funds  due  on  the 
certificate  by  a  proceeding  in  equity  against  the  beneficiary  and  the 

society. 

Rose   vs.  Wilkins,   Oct.,   1900,   78  Miss.   401. 

Beneficiaries  Limited  to  Class  Named  in  Laws. 

The  charter  of  a  society  authorized  it  to  make  contracts  to  pay 
benefits  to  members  of  the  family  of  or  to  some  person  dependent 
upon  the  member.  It  was  held  that  a  stranger  could  not  obtain  any 
interest  in  a  certificate  issued  by  such  society,  though  it  might  be 
assigned  to  him  by  the  member. 

Rose  vs.  Wilkins,  Oct.,  1900,  78  Miss.  401. 

' '  Waiver ' ' — Definition  of. 

A  waiver  is  the  intentional  relinquishment  of  a  known  right,  and 
it  implies  an  election  to  forego  some  advantage  upon  which  the 
party  at  his  option  might  have  insisted. 

Supreme  Lodge  Knights  of  Pythias  vs.  Quinn,  Oct.,  1900,  78  Miss.  525. 

Precedent  Conditions  to  Reinstatement  of  Forfeited  Member. 

A  member  did  not  pay  for  April,  May  and  June.  Payments  under 
the  laws  Avere  required  to  be  made  not  later  than  the  10th  of  each 
month,  failing  which  the  member's  certificate  was  forfeited.  On  the 
20th  of  June  the  member  being  then  sick,  and  shortly  thereafter 


THE    STATE    OF    MI8SIBSIPPI  555 

dying,  forwarded  his  payment  for  the  throe  months,  asking  for 
re-instatement.  The  society  accepted  the  iiKuicy  ;iiid  wroti'  him, 
saying  that  he  had  been  reinstated  if  he  was  in  good  liealth.  He 
was  not  in  good  health.  Upon  suit  lieing  brought  upon  the  refusal 
of  the  society  to  pay  the  amount  of  the  certificate,  the  Court  said 
"in  the  letter  accompanying  the  remittance  of  his  dues,  there  is  not 
a  syllable  relating  to  his  health.  Under  this  state  of  the  case  there 
could  be  no  reinstatement  of  Quinn  to  membership  in  the  societ.y 
by  the  mere  payment  of  his  past  dues,  without  knowledge  of  his 
physical  condition,  and  the  claim  of  his  beneficiary  to  his  rein- 
statement is  groundless." 

Supreme  Lodge  Knights  of  Pythias  vs.  Quinn,  Oct.,  1900.  78  Miss.  525. 

Power  to  Legislate  Cannot  be  Delegated. 

The  power  to  legislate  given  by  a  societj*  to  the  supreme  lodge, 
the  supreme  governing  body,  cannot  be  delegated  to  a  board  of 
directors  which  is  a  mere  administrative  agency. 

Supreme  Lodge  Knights  of  Pythias  vs.  Stein,  March,  1897.  75  Miss. 
107. 

Laws  of  Society  of  More  Force  Than  Mere  Certificate. 

The  rights  of  members  are  not  fixed  so  much  by  the  terms  of  the 
certificate  as  b.y  the  laws  of  the  society. 

Supreme  Lodge  Knights  of  Pythias  vs.  Stein,  March.  1897,  75  Miss. 
107. 

Benefit  Fund  Not  Subject  to  Creditors  Claims. 

In  a  contest  between  a  bank  and  a  beneficiary  under  a  certificate 
issued  in  the  Knights  of  P.ythias,  as  to  which  was  entitled  to  the 
fund  that  had  been  paid  into  court  liy  the  society,  the  Court  said, 
"it  is  obvious  that  if  the  member  holding  the  endowment  certificate 
coidd  validly  transfer  it  to  his  creditor,  as  a  security  for  his  debt, 
the  policies  of  such  societies  like  this  or  regular  insurance  com- 


556  FRATERNAL    SOCIETY    LAW 

panies,  would  become  to  some  extent  the  subject  of  trade  and  specu- 
lation in  contravention  of  the  express  policy  of  the  law  creating 
them,  and  in  total  subversion  of  the  avowed  objects  of  these  asso- 
ciations." 

Carson  vs.  Vicksburg  Bank.  March,  1897.  75  Miss.  167. 

Beneficiaries — Laws  for  Changing. 

The  laws  of  a  society  prescribing  rules  for  the  changing  of  bene- 
ficiaries was  held  to  be  for  the  benefit  and  protection  of  the  society, 
that  the  mode  of  changing  the  beneficiaries  prescribed  bj'  the  rules, 
as  between  rival  claimants,  is  not  exclusive ;  but  that  the  society 
may  waive  some  of  them,  but  such  waiver  is  not  to  be  regarded  as 
conferring  rights  on  rival  claimants,  as  they  cannot  be  heard  to 
object  to  the  society's  action  in  waiving  its  laws  in  this  respect. 

Hall  vs.  Allen,   March,  1897,   75  Miss.  175. 

Charter  Higher  Than  Constitution,  Latter  a  Mere  By-law  and  May 
Be  Changed  By  Resolution, 

A  constitution  adopted  by  a  society  has  no  restrictive  force  over 
its  charter,  and  is  in  effect  a  mere  by-law  tliat  may  be  repealed  or 
modified  in  a  resolution  subsequently  adopted  bj*  the  corporation, 
notwithstanding  such  resolution  was  not  the  prescribed  mode  for 
enacting  or  repealing  the  hiws,  or  amending  the  constitution  of  the 
society. 

Domes  vs.  Supreme  Lodge  Knights  of  Pythias,  Dec.  1897,  75  Miss. 
466. 

After-enacted  Laws — Binding  Though  Not  Adopted  in  Regular  Mode. 

The  board  of  directors  of  a  society  passed  a  siiicide  law  and 
rcjiorted  their  action  to  the  supreme  lodge,  which  by  resolution 
adopted  the  report  of  the  board  of  directors.  It  was  held  that  this 
action  on  the  part  of  the  supreme  lodge  put  into  force  the  suicide 
by-law,  and  that  it  became  a  part  of  all  the  outstanding,  contracts 


THE    STATE    OF    MISSISSIPPI  ii57 

made  between  the  society  and  the  members,  and  that  members  were 
bound  by  said  sviicide  by-law  just  as  though  it  had  been  enacted  by 
the  supreme  h)dge  in  the  first  instance. 

Domes  vs.  Supreme  Lodge  Knights  of  Pythias.  Dec.  1S97.  75  Miss. 
466. 

After-enacted  Suicide  By-law  Valid. 

On  the  question  of  after-enaetod  laws,  the  Court  said.  "The 
insured  contracted  in  his  application  and  certificate  to  be  bound  by 
all  laws  then  in  force  and  thereafter  to  be  enacted  l)y  the  supreme 
lodge,  and  nearly  two  years  elapsed  after  the  law  went  into  force 
before  the  insured's  death.  *  *  *  *  "We  know  of  no  reason  why  it 
is  not  valid  in  such  cases,  if  changes  made  are  not  in  violation  of  the 
contract  but  are  in  harmony  with  it." 

Domes  vs.  Supreme  Lodge  Knights  of  Pythias,  Dec,  1897,  75  Miss. 
466. 


558  FRATERNAL   SOCIETY   LAW 


THE 

■      STATE  OF  MISSOURI. 

CHAPTER  26. 

(The  Section  numbers  employed  correspond  to  those  in  the  R.  S. 
of  Missouri.) 

Who  May  Be  Incorporated. 

Section  1394.  Any  number  of  persons,  not  less  than  three,  who 
shall  have  associated  themselves  by  articles  of  agreement,  in  writ- 
ing, as  a  societ}',  company,  association  or  organization  formed  for 
benevolent,  religious,  scientific,  fraternal-beneficial,  or  educational 
purposes,  may  be  consolidated  and  united  into  a  corporation.  Such 
articles  of  agreement  may  be  organic  regulations,  or  a  constitution, 
or  other  form  of  association,  and  any  corporate  name,  not  alread.v 
assumed  by  another  corpoi-ation,  may  be  chosen  as  the  title  of 
the  corporation :  Provided,  always,  that  the  purpose  and  scope 
of  the  association  be  clearly  and  fully  set  forth.  (R.  S.  1889, 
Sec.  2821— t.) 

How  Incorporated. 

Section  1395.  The  persons  holding  the  offices  respectively  of 
president,  secretary  and  treasurer  of  the  association,  or  other  chief 
officers,  by  whatever  name  they  may  be  known,  shall  submit  to 
the  circuit  court  having  jurisdiction  in  the  city  or  county  where 
such    association    is  located,   the    articles   of  agreement,   with   the 


I 


THE    HTATE    OF    MISSOURI  569 

petitiou  praymg   ior   a  pro   I'orma   decree   thereou.      il   the   court 
shall  be  of  the  opinion  that  such  articles  of  agreement  and  the 
purposes  of  the  association  come  properly  within  the  pui-view  of 
this  article,  and  are  not  inconsistent  with  the  constitution  or  laws 
of  tlie  United  States,  or  of  this  State,  the  court  shall  enter  of  record 
an  order  to  that  effect,  a  certified  copy  of  which  order  shall,  by  the 
clerk,  be  indoi-sed  upon  or  attached  to  said  articles.     But  no  such 
order  shall  be  made  until  such  petition  shall  have  remained  on  file 
in  the  clerk's  office  of  said  court  for  at  least  three  days  after  said 
petition  shall  have  been  presented  to  the  court;  and  whenever  the 
judge  to  whom  such  petitiou  shall  have  been  presented  shall  en- 
tertain any  doubt  as  to  the  lawfulness  or  public  usefuluess  of  the 
proposed  corporation,  it  shall  be  his  duty  to  appoint  some  compe- 
tent attorney,  as  a  friend  of  the  court,  whose  duty  it  shall  be  to 
examine  said   i)etitii)ii   and  show   cause,   if  any  there  be,   on   some 
day  to  be  fixed  by  the  court,  why  the  prayer  of  said  petition  should 
not  be  granted,  and  said  attorney  shall  not  be  confined  in  his  ex- 
amination to  said  petition  and  articles  of  association,  but  may  in- 
troduce such  testimony  as  may  be  available  and  proper  in  order 
to  fully  disclose  the  true  purposes  of  the  association ;  and  upon 
the  hearing  thereof,  tlie  court  shall  make  such  further  order  "grant- 
ing or  dismissing  said  petition  as  to  it  may  seem  best,  and  upon 
the  granting  of  such  petition,  the  petitioners  shall  cause  the  articles 
of  agreement,  with  the  certificate  aforesaid,  to  be  recorded  in  the 
office  of  the  recorder  of  deeds  of  the  county  in  which  the  association 
is  located,   and  then  filed  in  the  office  of  the  secretary  of  state. 
The  secretary  of  state  shall  issue  to  the  petitioners  a  certified  copy 
of  such  articles  of  agreement,  with  the  several  certificates  thereon 
as  filed  in  his  office,  which  certified  copy  shall  be  the  charter  of 
incorporation;  and  thereupon  the  petitioners,  their  associates  and 
successors,  shall  be  created  and  be  a  body  corporate  and  politic, 
by   the    corporate    name    designated    in    such    charter,    and     such 
charter,  together  with  this  article,  shall  be  received  in  all  courts 
and  places  as  legal  evidence  of  the  incorporation  of  such  association. 
(R.  S.  1889,  See.  2822.) 


560  FRATERNAL    SOCIETY    LAW 

May  Have  Benefit  of  Foregoing  Section — How. 

Section  1396.  Any  such  society,  order  or  association  heretofore 
or  hereafter  incorporated  under  the  provisions  of  the  laws  of  this 
State,  may  avail  itself  of  the  benefits  of  the  foregoing  section  (1408) 
by  amending  its  constitution  or  articles  of  association  or  reincorpor- 
ating thereunder,  or  by  an  amended  constitution  or  amended  articles 
of  association  in  the  manner  prescribed  by  this  act.  (R.  S.  1889,  Sec. 
2824,  amended  Laws  1897,  p.  1.32.) 

What  Associations  May  Incorporate. 

Section  1397.  iiny  association  formed  for  benevolent  purposes, 
including  any  purely  charitable  society,  hospital,  asylum,  house  of 
refuge,  reformatory  and  eleemosynary  institution,  fraternal-bene- 
ficial associations,  or  any  association  whose  object  is  to  promote 
temperance  or  other  virtue  conducive  to  the  well  being  of  the  com- 
munity, and  generally,  any  association  formed  to  provide  for  some 
good  in  the  order  of  benevolence,  that  is  useful  to  the  public,  may 
become  a  body  corporate  and  politic  under  this  article ;  any  asso- 
ciation, congregation,  society  or  church  organization  formed  for 
religious  purposes,  and  any  association  formed  to  provide  or  main- 
tain a  cemetery ;  any  school,  college,  institute,  academy  or  other 
association  formed  for  educational  or  scientific  purposes,  including 
therein  any  association  formed  specially  to  promote  literature,  his- 
tory, science,  information  or  skill  among  the  learned  professions, 
intellectual  culture  in  any  branch  or  department,  or  the  establish- 
ing of  a  museum,  library,  art  gallery,  or  the  erection  of  a  public 
monument,  and  in  seiii-i-al,  any  association,  society,  company  or  or- 
ganization which  tends  to  the  ])ublie  advantage  in  relation  to  any 
or  several  of  the  objects  above  enumerated,  and  whatever  is  in- 
cident to  siu-h  objects,  may  be  created  a  body  corporate  and  politic 
by  complying  with  sections  1394  and  1395.     (R.  S.  1889,  See.  2825.) 

May  Amend  Charter — How. 

Section  1398.  Any  corporation  formed  under  this  artieb',  or 
any  existing  corporation  formed  for  benevolent,  religious,  scientific 


THE    H'l'ATE    OF    MhSSOUKl  561 

or  educatioual  purposes,  may  amend  its  cliarter  in  any  inattcr  gcr- 
iiiaiie  to  such  charter,  by  submitting  the  proposed  aiiniidiiient  to 
the  circuit  court,  and  in  olliei-  resjiects  proceeding  as  required  in 
section  1395,  for  the  origiiud  articles  of  agreement.  And  upon  the 
issuing  of  a  certified  copy  of  such  amendment  by  tlie  secretary  of 
state  such  amendment  sliail  become  and  be  p^ni  of  the  charter  of 
such  corporation,  with  like  effect  and  validity  as  though  originally 
incorporated  in  such  charter.  An.y  such  corporation  may,  without 
losing  its  personal  identity,  change  its  corporate  name  as  an  amend- 
ment to  its  charter.     (R.  S.  1889.  Sec.  2826— u.) 

Dues — How  Collected. 

Section  1399.  The  dues  of  members  of  corporations  created  under 
this  article,  as  determined  by  their  charters  or  by-biws.  and  any 
donations  of  subscri])tions  lo  which  they  may  voluntarily  obligate 
themselves,  may  be  collected  as  any  other  debt;  but  over  and 
above  such  dues  or  such  subscriptions  in  no  case  shall  any  member 
be  individually  liable.     (R.  S.  1889,  Sec.  2827.) 

May  Be  Formed  to  Execute  Trusts. 

Section  1400.  Corporations  may  be  formed,  under  the  provisions 
of  this  article,  to  execute  any  trust  the  purpose  whereof  is  within 
the  purview  of  this  article,  and  may  receive  and  take,  by  deed 
or  devise,  in  their  corporate  capacity,  any  property,  real  and  per- 
sonal, for  the  uses  and  purposes  of  such  trust,  and  execute  the 
trust  so  created.     (R.  S.  1889,  Sec.  2828.) 

What  Associations  Not  to  Incorporate  Under  This  Article — Com- 
pany Formed  to  Erect  Building  for  Use  of  Society — May. 

Section  1401.  No  association,  society  or  company  formed  for 
manufactixring,  agricultural  or  business  purposes  of  any  kind,  or 
for  pecuniary  profit  in  any  form,  nor  any  corporation  having  a 
capital  stock  divided  into  shares,  shall  be  incorporated  amder  this 
nrticle:  Provided,  that  any  company  formed  to  erect  a  building 
for  the  exclusive  use  of  a  society  within  the  purview  of  this  article. 


5t;'2  FRATERNAL    SOCIETY    LAW 

without  pecuniary  consideration  from  such  society  may  become  a 
body  corporate  under  this  ai'ticle,  notwithstanding  it  has  a  capital 
stock  in  shares,  and  may  receive  subscriptions  to  such  stock,  to 
be  paid  iu  real  estate,  in  money,  property  or  services  rendered  to 
such  company.     (R.  S.  1889.  Sec.  2829.) 

Shall  Keep  a  Record. 

Section  1402.  Every  corporation  formed  under  this  article  shall 
keep  a  fair  record  of  all  its  proceedings,  which  record  shall  be 
open,  at  all  reasonable  hours,  to  the  inspection  of  all  its  members. 
(R.  S.  1889,  Sec.  2830.) 

Shall  Make  By-laws,  Etc. 

Section  1403.  Every  corporation  created  under  this  article  shall 
make  by-laws  for  its  government  and  support  and  the  management 
of  its  property,  and  therein  provide,  unless  such  provision  is  al- 
ready made  in  its  charter  for  the  admission  of  new  members  and 
how  they  shall  be  admitted,  and  prescribe  their  qualifications.  Pro- 
visions may  also  be  made  in  such  by-laws  for  the  removal  of  officers 
for  cause,  and  for  the  expulsion  of  members  guilty  of  any  offense 
which  aft'ects  the  interests  or  good  government  of  the  corporation, 
or  is  indictable  by  the  laws  of  the  laud :  Provided,  always,  that 
such  by-laws  shall  be  conformable  to  the  charter  of  such  corpor- 
ation, and  shall  not  impair  or  limit  any  provisions  thereof  or  en- 
large its  scope,  and  shall  not  be  contrary  to  the  provisions  of  the 
constitution  or  laws  of  this  State.     (R.  S.  1889,  Sec.  2831.) 

This  Section  May  Be  Incorporated  in  Charter — When — Purpose  and 
Effect. 

Section  1404.  Any  association  or  society  formed  for  educational 
purposes  as  classified  in  section  1397,  and  as  hereinafter  limited, 
located  in  any  city  or  town,  may  elect  to  provide  iu  its  ai-ticles 
of  agreement,  by  incorporating  this  section  in  such  articles,  and 
in  other  respects  conforming  them  thereto,  that  such  corjioration 
shall   be.    ill   all   that  relates   to   its  property  and   all    such    it  may 


THE    STATE    OF    MiHSOUIil  6G3 

acquire,  a  quasi  trustee  for  thu  public,  aud  as  such  may  receive 
and  take  by  deed  or  devise  in  its  corporate  capacity,  any  property, 
real  aud  personal,  in  trust  for  the  uses  and  purposes  for  which 
such  corporation  was  formed,  aud  execute  any  trust  so  created: 
Px-ovided,  that  this  section  shall  apply  only,  and  it  is  hereby  ex- 
pressly limited,  to  such  association  or  society  as  may  be  formed 
for  the  purpose  of  promotiug  historical  studies  or  natural  science, 
of  establishing  a  museum,  library  or  au  art  gallery,  such  educa- 
tional aud  scientific  purposes  beiug  chiefly  for  the  advantage  of  the 
public  where  such  corporation  is  located ;  and  provided  furthermore 
that  no  corporation  in  whose  charter  is  incorporated  this  section 
shall  be  permitted  to  amend  such  charter  or  to  take  advantage 
or  avail  itself  of  any  chauge  in  the  general  law,  iu  such  way  as 
to  att'eet  this  section,  and  such  charter  shall  be  taken  as  a  perpetual 
contract  between  such  corporation  and  the  public.  It  shall  not 
be  lawful  for  such  corporation  to  create  or  eiuitract  any  debt  or 
]i('('Uiiiary  oliligatioii  in  the  nature  of  a  debt;  jind  any  attempt 
to  create  or  contract  any  such  debt  oi-  oliligation  shall  be  ipso  facto, 
void.  Nor  shall  any  such  corporation  mortgage,  or  deed  in  trust. 
any  of  its  property,  or  sell  any  such  property,  except  by  way 
of  exchange  for  property  of  equal  value,  or  for  reinvestment.  If 
any  such  corporation  dissolve,  its  property  shall  be  vested  in  the 
city  or  town  iu  which  such  corporatiou  is  located,  to  be  taken  and 
held  for  the  benefit  of  the  people  of  such  city  or  town,  to  the  same 
purpose,  uses  and  trusts  as  such  property  was  held  by  such  cor- 
I)oration.  Membership  iu  such  corporation  shall  be  open  to  the 
public,  under  such  reasonable  rules  and  regulations  as  the  corpo- 
ration may  prescribe  in  its  by-laws.  Every  such  corporation  shall 
create  and  maintain  an  endowment  fund,  to  remain  perpetually 
intact,  that  means  may  thereby  be  provided  for  the  stabilitj'  and 
support  of  the  corporation;  and  to  this  end  all  moneys  voluntarily 
contributed  as  life  membership,  aud  by  persons  not  residents  of 
the  locality  where  such  corporation  is  located,  who  desire  to  be 
registered  as  members,  and  one-fourth  of  the  current  subscriptions 
from  memberships,  shall  be  set  apart,  until  the  moneys  derived 
from  these  sources,  together  with  such  as  lawfully  come  into  such 
endowment  fund  from  other  soiu'ces,  shall  amount  in  the  aggregate 


564  FRATERNAL    SOCIETY   LAW 

to  at  least  two  hundred  thousand  dollars.  Such  endowment  fund 
may  be  invested  in  bonds  of  the  United  States,  or  of  this  State, 
or  of  the  city  or  county  in  which  the  corporation  is  located,  or 
in  loans  secured  by  mortgage  on  improved  real  estate  situated  in 
this  State,  but  shall  not  be  invested  in  securities  or  stock  of  any 
private  trading  or  manufacturing  corporation,  or  of  an.y  railroad 
company,  or  on  any  j^ersonal  security,  and  the  principal  thereof 
shall  not  be  encroached  upon  or  expended  by  such  corporation  for 
anj^  purpose.  The  museum,  gallery  and  cabinets  of  such  corpo- 
ration shall  be  open  to  the  public  of  this  State,  inider  such  reasonable 
regulations  as  may  from  time  to  time  be  prescribed  and  the  eon- 
tents  of  such  museum,  gallery  or  cabinets,  or  au.y  portion  thereof, 
shall  not  be  loaned  or  taken  out  for  exhibition  or  other  purposes, 
on  any  pretext  whatever.  Any  existing  corporation  formed  for 
pui-poses  within  the  purview  of  this  section,  and  whose  charter 
is  in  harmony  therewith,  shall  be  empowered  to  adopt  the  same  as 
an  amendment  to  such  charter,  under  the  ju'ovisions  of  section 
1398.     (R.  S.  1889,  Sec.  2832.) 

May  Acquire  Property — How — Application  of  Income. 

Section  1405.  It  shall  be  lawful  for  any  corporation  which  may 
be  organized  under  this  article,  or  any  existing  corporation  the 
purposes  w-hereof  are  included  in  those  mentioned  in  section  1397 
hereof,  to  acquire,  by  subscription,  purchase,  devise  or  gift,  shares 
of  stock  in  any  stock  company,  which  shall  hereafter  be  incorpo- 
rated under  and  jiursuant  to  the  laws  of  this  State,  for  the  sole  pur- 
pose of  erecting  or  purchasing  a  hall  or  building  for  the  use  and 
benefit  of  any  one  or  more  of  such  corporations  as  mentioned  in 
section  1397,  and  to  bold  such  stock  as  personal  property,  and  to 
enjoy  the  rights  and  privileges  appertaining  to  such  ownership: 
Provided,  that  the  stock  corporation  erecting  or  purchasing  such 
hall  or  building  for  the  purpose  aforesaid  shall  not  permit  the  same 
to  be  occupied  or  used  by  any  person  or  corporation  for  any  pur- 
pose not  included  among  those  specified  in  section  1397,  except  .so 
much  of  said  building  as  may  be  necessarily  rented  for  business 
purposes,  in  order  to  secure  a  sufficient  revenue  to  provide  for  the 


THt:    HTATE    OF    MItiiiOURl  565 

expenses  of  the  care  and  maintenance  of  said  property,  and  Uiv 
ainiual  dividends  not  to  exceed  live  i)er  cent  upon  the  capital  .sUn'k 
tlii'reof,  and  every  such  stock  corporation  as  hereinbefore  men- 
tioned, shall  in  the  articles  oP  association  thereof,  expressly  declare 
its  sole  i)urposes  to  be  such  as  above  provided  for;  and  provided 
further,  that  any  corporation,  the  i)uri)Oses  whereof  are  included  in 
section  1397  hereof,  may  acquire  and  hold  in  its  own  name  such 
real  estate  and  buildings  as  may  be  necessary  for  assembly,  library, 
laboratory  and  other  rooms  requisite  for  its  purposes,  and  may 
receive  income  from  such  other  rooms  as  may  be  requisite  to  the 
completeness  of  such  buildinii's;  but  such  income  slmll  he  .-iiipliiMl 
to  the  purpose  of  such  corporation  iis  defined  in  sedion  1:5117.  ( H. 
S.  1889,  Sec.  2833.) 

Miscellaneous  Associations — How  Formed. 

Section  1406.  Any  association  furiiied  lor  the  purpose  of  estab- 
lishing a  gymnasium,  or  club  house,  or  for  promoting  boating,  field 
sjjorts,  or  other  rational  amusements,  or  for  any  other  purpose  not 
excluded  by  section  1401,  lawful  in  itself  and  not  otherwise  specially 
provided  for,  may  also  by  complying  with  sections  1394  and  1395, 
become  a  body  corporate  and  politic,  and  under  this  article  shall 
possess  the  rights  and  privileges  and  be  subject  to  the  limitations 
and  requirements  herein  provided,  so  far  as  the  same  are  applicable 
thereto.     (R.  S.  1889,  Sec.  2834.*) 

May  Be  Proceeded  Against  by  Quo  Warranto — When. 

Section  1407.  The  circuit  court  of  the  cit.v  or  county  in  which 
any  corporation  organized  under  this  article  shall  be  located  shall, 
upon  proceedings  by  information  in  the  nature  of  a  quo  warranto, 
instituted  against  such  corporation  or  the  officers  thereof,  by  the 
attorney-general  or  circint  attorney,  at  the  relation  of  any  person 
desiring  to  prosecute  the  same,  inquire  into  any  alleged  unlawful 
acts  of  or  misuser  or  non-user  of  its  franchise  by  such  corporation, 

*Insofar  as  this  section  undertakes  to  allow  corporations  to  be  created  for 
other  tlian  benevolent,  religious,  scientific  or  educational  purposes,  it  Is 
void.     99  Mo.  552. 


566  FRATERNAL    SOCIETY   LAW 

in  like  manner  as  is  or  may  be  provided  by  law  for  proceedings  in 
case  of  the  alleged  usurpation  of  or  intrusion  into  any  public  office 
by  any  person.  If  in  any  such  proceedings,  judgment  of  forfeiture 
or  dissolution  be  rendered  against  such  corporation,  it  shall  be  law- 
ful for  the  court  to  provide  by  such  judgment  for  the  vesting  of 
the  property  of  such  corporation,  upon  such  dissolution  or  for- 
feiture, in  a  receiver  or  receivers,  to  be  appointed  by  the  court, 
and  in  his  or  their  successors  in  office.  Such  receiver  or  receivers, 
upon  giving  sufficient  security,  to  be  approved  by  the  court,  for 
the  faithful  i)erformance  of  his  or  their  duties,  shall  succeed  to 
the  title  of  such  corporation  iu  and  to  all  its  property  and  estate, 
and  shall  hold  the  same  in  trust  for  the  creditors  thereof,  and 
other  persons  who  may  be  entitled  thereto,  and  shall  receive,  collect, 
sue  for,  recover,  hold,  manage  and  dispose  of  the  same  under  and 
pui'suant  to  the  orders  of  such  court,  to  be  made  from  time  to  time 
in  that  behalf,  according  to  right  and  justice.  An.y  surplus  remain- 
ing after  paying  the  debts  of  such  corporation  shall,  except  as 
hereinafter  provided,  be  distributed  among  the  persons  who  were 
members  of  such  corporation  at  the  time  of  such  dissolution  or 
forfeiture,  or  their  legal  representatives  respectively,  in  equal 
shares,  unless  for  good  cause  shown  the  court  shnll  otherwise  order: 
Provided,  that  if  upon  the  dissolution  or  forfeiture  of  the  franchises 
of  any  corporation  formed  under  this  article,  it  shall  appear  that 
any  property  vested  in  said  corporation  was  held  by  it  upon  trust 
for  any  charitable  purpose  or  subject  to  the  provisions  of  section 
1404,  such  property  or  surplus  shall  not  be  distributed  as  above 
provided,  but  shall,  by  decree  of  such  court,  to  be  made  without 
delay,  after  the  debts  of  such  corporation,  if  any,  shall  have  been 
fully  paid  out  of  said  property,  be  vested  in  one  or  more  trustees 
for  the  charitable  iiurpose  for  which  such  corporation  held  the 
same,  or  in  the  case  of  corporations  which  have  complied  with  the 
provisions  of  section  1404,  shall  be  disposed  of  in  the  manner  in 
said  section  provided  for  upon  the  dissolution  of  any  such  corpor- 
ation. And  it  shall  be  the  diaty  of  the  attorney-general,  or  circuit 
or  prosecuting  attorney  of  the  proper  circuit  or  county,  whenever 
any  creditable  persoii  shall,  in  writing,  make  eomplnint  to  him 
upon    affidavit    of    information    and    belief,    that    any    corporation 


THE    STATE    OF    MISSOURI  -jtt? 

formed  iiiulci'  this  article  has,  in  any  material  matter,  wilfully 
misused,  or,  for  two  years  last  past,  has  neglected  to  use  its  fran- 
chises, or  has  otherwise  become  liable  to  forfeit  its  charter,  to  in- 
(juire  diligently  into  the  grounds  of  such  complaint,  and  upon  rea- 
sonable cause  shown  therefor,  to  institute  proceedings  by  infor- 
mation in  the  nature  of  a  quo  warranto,  looking  to  a  dissolution 
of  such  corporation  and  a  forfeiture  of  its  corporate  rights.  (R.  S. 
1889,  Sec.  2835.*) 

Property  Rights  of  Dissolved  Corporations  to  be  Vested  in  New — 
How. 

Section  1407a.  Whenever  the  members  of  any  corporation  hereto- 
fore or  hereafter  incorporated  under  the  laws  of  this  8tate  for  any 
benevolent  purpose,  or  whenever  the  persons  who  were  or  shall  be 
at  the  time  of  the  dissolution  of  any  such  corporation,  members 
thereof  (or  in  case  of  the  death  of  any  of  them)  the  survivors, 
shall,  themselves,  or  with  other  associates,  become  incorporated 
under  the  provisions  of  this  article  for  the  same  benevolent  purpose, 
under  the  same  or  anj'  other  corporate  name,  it  shall  be  lawful  and 
it  shall  be  the  duty  of  the  person  who  may  be  the  president  of 
such  former  corporation,  or  who  was  or  may  be  its  president  at  the 
time  of  its  dissolution,  to  execute  and  acknowledge  in  the  name 
and  on  behalf  of  such  former  corporation,  a  eonvej'ance  of  all  the 
property,  real  and  personal,  and  assets  of  every  description  of  said 
former  corporation,  conveying  the  same  to  the  new  corporation 
so  incorporated;  and  such  conveyance  shall  have  the  effect  to  vest  in 
such  new  corporation  all  the  right,  itle  and  interest  in  such  prop- 
erty, real  and  personal,  and  assets  of  every  description,  which  were 
at  any  time  possessed  by  said  former  corporation.  (Approved  Ajiril 
12.  1905.) 

Fraternal  Beneficiary  Association,  What  is — Government  of — Bene- 
fit Fund — Benefits,  to  be  Paid  to  Whom. 

Section  1408.     A  fraternal  beneficiary  association  is  hereby  de- 


*How  private  charitable  corporations  should  he  proceeded  against  for  mis- 
appropriation of  funds.     100  Mo.   4.51. 


568  FRATERNAL    SOCIETY    LAW 

elared  to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have 
a  lodge  system,  with  ritualistic  form  of  work  and  representative 
form  of  government,  and  shall  make  provisions  for  the  payment  of 
benefits  in  case  of  death,  and  may  make  provision  for  the  payment 
of  benefits  in  case  of  sickness,  temporary  or  permanent  physical 
disability  either  as  the  result  of  disease,  accident  or  old  age,  pro- 
vided the  period  in  life  at  which  payment  of  physical  disability 
benefits  on  account  of  old  age  commences,  shall  not  be  under  seventy 
(70)  years,  subject  to  their  compliance  with  its  constitution  and 
laws.  The  fund  from  which  the  payment  of  such  benefits  shall  be 
made,  and  the  fund  from  wliieli  the  expenses  of  such  association 
shall  be  defrayed  shall  be  derived  from  assessments  or  dues  collected 
from  its  members.  Payments  of  death  benefits  shall  be  to  the  fami- 
lies, heirs,  blood  relatives,  affianced  husband  or  affianced  wife  of, 
or  to  persons  dependent  upon  the  member.  Such  associations  shall 
be  governed  by  this  act  and  shall  be  exempt  from  the  provisions  of 
the  insurance  laws  of  this  State,  and  shall  not  pay  a  corporation  or 
other  tax,  and  no  law  hereafter  passed  shall  apply  to  them  unless 
they  be  expressly  designated  therein.  And  such  fratei-nal  beneficial 
association  may  create,  maintain,  disburse  and  apply  a  reserve  or 
emergency  fund  in  accordance  with  its  constitution  or  by-laws. 
(Laws  1897,  p.  132.) 

Associations  Already  Formed  to  Comply. 

Section  1409.  All  such  associations  coming  within  the  descrip- 
tion as  set  forth  in  section  l-tOS  of  this  article,  organized  under 
the  laws  of  this  or  any  other  State,  province  or  territory,  and  now 
doing  business  in  this  State,  may  continue  such  business:  Provided, 
that  they  hereafter  comply  with  the  provisions  of  this  act  regulating 
annual  reports  and  the  designation  of  the  superintendent  of  the  in- 
surance department  as  the  person  upon  whom  process  may  be  served, 
as  hereinafter  pnivided.     (Laws  1897.  p.  132.) 

Foreign  Associations. 

Section  1410.     Anv  such  association  coming  within  the  descrip- 


TUB    STATE    OF    MISSOURI  569 

tiou  as  set  forth  iu  section  1408  of  this  article,  organized  under  the 
laws  of  any  other  State,  province  or  territory  and  not  now  doing 
bnsini'ss  in  tin's  State,  shall  be  admitted  to  do  business  within  this 
Stale  wlirii  it  slinll  li;i\c  filed  with  the  superintendent  of  the  insurance 
dejiartnient  a  duly  certified  copy  of  its  charter  and  articles  of  asso- 
ciation, and  a  copy  of  its  constitution  or  laws,  certified  to  by  its 
secretary  or  corresponding  ofificer,  together  with  an  appointment 
of  file  superintendent  of  the  insurance  department  of  this  State 
as  a  jjcrson  upon  whoin  process  shall  be  served  as  herein  provided  ; 
and  provided,  that  such  association  shall  be  shown  to  be  authorized 
to  do  business  in  the  State,  province  or  territory  in  which  it  is  in- 
corporated or  organized,  in  case  the  laws  of  such  State,  province  or 
territory  shall  provide  for  such  authorization ;  and  in  case  the  laws 
of  such  State,  province  or  territory  do  not  provide  for  any  formal 
authorization  to  do  business  on  the  part  of  any  such  association,  then 
such  association  shall  be  shown  to  be  conducting  its  business  within 
the  provisions  of  this  act,  for  which  purpose  the  superintendent  of 
the  insurance  department  of  this  State  may  personally,  or  by  some 
person  to  be  designated  by  him,  examine  into  the  condition,  affairs, 
character  and  business  methods,  accounts,  books  and  investments  of 
such  association  at  its  home  office,  which  examination  shall  be  at  the 
expense  of  such  association,  and  shall  be  made  wdthin  thirty  days 
after  demand  therefor,  and  the  expense  of  such  examination  shall 
be  limited  to  $50.     (Laws  1897,  p.  132.) 

Fraternal  Beneficiary  Associations  to  Make  Reports — Contents. 

Section  1411.  Every  such  association  doing  business  in  this 
State  shall,  on  or  before  the  first  day  of  ]\Iarch  of  each  year,  make 
and  file  with  the  superintendent  of  the  insurance  department  of  this 
State  a  report  of  its  affairs  and  operations  during  the  .vear  ending 
on  the  31st  day  of  December  immediately  preceding,  which  annual 
report  shall  be  in  lieu  of  all  other  reports  required  by  any  other 
law^  Such  reports  shall  be  upon  blank  forms  to  be  provided  by 
the  superintendent  of  the  insurance  department,  or  may  be  printed 
in  jiamphlet  form,  and  shall  be  verified  under  oath  liy  the  duly  au- 
thoi-ized  officers  of  such  association,  and  shall  be  published,  or  the 
substance  thereof,  in  the  annual  report  of  the  superintendent  of  the 


570  FRATERNAL    SOCIETY    LAW 

insurance  department  under  a  separate  part  entitled  "Fraternal 
beneficiary  associations,"  and  shall  contain  answers  to  the  follow- 
ing questions: 

1.  Number  of  certificates  issued  during  the  year,  or  members 
admitted. 

2.  Amount  of  indemnity  affected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representa- 
tives or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and  brief 
statement  of  reasons. 

9.  Does  association  charge  annual  or  other  periodical  dues  or 
admission  fees? 

10.  How  much  on  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be. 

11.  Total  amount  received,  from  what  source,  aud  the  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  association  guarantee  in  its  certificates  fixed  amounts 
to  be  paid,  regardless  of  amount  realized  from  assessments,  dues, 
admission  fees  and  donations? 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  such 
guarantee. 

15.  Has  the  association  a  reserve  or  emergency  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested. 

17.  Has  the  association  more  than  one  class? 

18.  If  so,  how  man.v,  and  the  amount  of  indemnity  in  each? 

19.  Number  of  members  in  each  class. 

20.  If  voluntary,  so  state  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  Avhat  time;  giving  chapter  and  .vear  and  date  of  the  ])assage 
of  the  act. 


THE    HTATE    OF    MIUHOVHl  571 

l!2.  li'  organized  tiiidci-  llic  liivvs  nt'  any  otlu'r  Slate,  province  or 
territory,  state  such  fact  and  the  date  of  organization,  giving  chapter 
and  year  and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  beneficiary  nienibersliip  lapsed  dur- 
ing tlie  year. 

24.  Number  in  force  at  beginning  and  end  of  .year;  if  more  than 
one  class,  number  in  each  class. 

25.  Names  and  addresses  of  its  president,  secretai'v  and  treay 
lire!',  or  corresponding  officers. 

Tile  superintendent  of  the  insurance  department  is  authorized  and 
empowered  to  address  any  additional  inquiries  to  any  such  associa- 
tion in  relation  to  the  matters  embraced  in  such  i-eport.  and  such 
officers  of  such  association  as  the  superintendent  of  the  insurance 
department  may  require,  shall  promptly  reply  in  writing,  \uuler 
oath,  to  all  such  inquiries.     (Laws  1897.  p.  132.) 

Service  of  Process  on  Fraternal  Beneficiary  Associations. 

Section  1412.  Each  such  a.ssociation  now  doing  or  hereafter  ad- 
mitted to  do  business  within  this  State  and  not  having  its  principal 
office  in  this  State,  and  not  having  organized  under  the  laws  of  this 
State,  shall  appoint,  in  writing,  the  superintendent  of  the  insurance 
department  and  his  successors  in  office  to  ]>e  its  true  and  lawful 
attorney,  and  upon  whom  all  lawful  process  in  any  action  or  pro- 
ceeding against  it  may  be  served,  and  in  siudi  writing  shall  agree 
that  any  lawful  process  against  it  which  is  served  on  said  attorney 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
association,  and  that  the  authorit.v  shall  continue  in  foi'ce  so  long  as 
any  liability  remain  outstanding  in  this  State.  Copies  of  such  cer- 
tificate, certified  by  said  superintendent  of  the  insurance  depart- 
ment, shall  be  deemed  sufficient  evidence  thereof,  and  shall  be  ad- 
mitted in  evidence  with  the  same  force  and  effect  as  the  original 
thereof  might  be  admitted.  Service  upon  such  attorney  shall  be 
deemed  sufficient  service  ujion  such  association.  When  legal  process 
against  any  such  association  is  served  upon  said  superintendent  of 
the  insurance  department,  he  shall  immediately  notify  the  associa- 
tion of  such  service  by  letter,  prepaid  and  directed  to  its  secretary 
or  corresponding  officer,  and  shall,  within  two  days  after  such  serv- 


572  FRATERNAL    SOCIETY    LAW 

ice,  forward  in  the  same  manner  a  copy  of  the  process  served  on 
him  to  such  officer.  The  phiintiff  in  such  process  so  served  shall 
pay  the  superintendent  of  the  insurance  department  at  the  time  of 
such  service  a  fee  of  $3.00,  which  shall  be  recovered  by  him  as  a 
part  of  the  taxable  costs,  if  he  prevails  in  the  suit.  The  superin- 
tendent of  the  insurance  department  shall  keep  a  record  of  all 
process  served  upon  him.  which  record  shall  show  the  day  and  hour 
when  such  service  was  made  and  by  whom  made.  (Laws  1897,  p. 
"132.) 

Section  1413.  Id.  In  case  of  a  vacancy  in  the  office  of  the  super- 
intendent of  the  insurance  department,  or  in  case  of  the  absence, 
inability,  or  suspension  of  such  superintendent,  the  service  upon  a 
ieputy,  appointed  under  the  provisions  of  section  5796  of  the  Re- 
rised  Statutes  of  Missouri  of  1889,  or  the  e.xercise  of  such  deputy 
of  the  powers  and  duties  of  such  superintendent,  shall  be  valid 
md  sufficient  for  the  purposes  of  this  act.     (Laws  1897,  p.  132.) 

Permit  to  do  Business,  How  Obtained. 

Section  1414.  The  superintendent  of  the  insurance  department 
of  this  State  shall,  upon  the  application  of  any  association  having: 
the  right  to  do  business  within  this  State,  as  prr.vided  by  this  act, 
^ssue  to  such  association  a  permit,  in  writing,  authorizing  such  asso- 
ciation to  do  business  within  this  State,  for  which  certificate  and 
ill  Tjroeeedings  in  connection  therewith  such  association  shall  pay 
to  said  superintendent  of  the  insurance  department  the  fee  of  $"1.00. 
(Laws  1897,  p.  132.) 

How  Incorporated. 

Section  1415.  Fraternal  beneficial  associations  .shall  be  incorpo- 
rated in  manner  as  now  is  or  may  he  hereafter  pro\ided  by  law. 
(Laws  1897,  p.  132.) 

Associations  Shall  Not  Employ  Agents,  When 

Section  1416.  S\ich  association  shall  not  employ  jiaid  agents  in 
soliciting  or  procuring  members  except  in  the  organization  or  build- 


THE    (STATE    OF    MISSOURI  573 

ing  up  of  subordinate  bodies  or  grauting-  members  inducements  to 
procure  new  members.     (Laws  1897,  p.  132.; 

Contract  of  Beneficiary  to  Pay  Dues,  EfTect  of. 

Section  1417.  No  contract  between  a  membtr  and  his  beneliciary, 
that  the  beneliciary,  or  any  person  for  him,  sha]l  pay  such  member's 
assessments  "and  dues,  or  eithei'  of  tliem,  shall  give  the  beneficiary 
a  vested  right  in  the  benefit  certificate,  or  in  tl.o  benefit  or  deprive 
the  member  of  the  right  to  change  the  name  of  the  beneficiary,  or 
revoke  the  certificate,  if  any,  issuetl  by  the  ass  Delation :  Provided, 
that  such  change  or  revocation  be  done  by  writteti  or  printed  notice 
to  the  association  in  the  manner  and  form  provided  for  by  its  by- 
laws.    (Laws  1897,  p.  132.) 

Benefits  Not  Liable  to  Attachment,  Execution  or  Other  Process,  Etc. 

Section  1418.  The  money  or  other  benefit,  charity,  relief  or  aid 
already  paid  or  to  be  paid,  provided  or  rendered  b/  any  association 
authorized  to  do  business  under  this  act  shall  not  be  liable  to  attach- 
ment or  execution  by  trustee,  garnishee  or  other  process,  and  shall 
not  be  seized,  taken,  appropriated  or  applied  by  an>  legal  or  equit- 
able process,  or  by  the  operation  of  law,  to  pay  any  debt  or  liability 
of  a  certificate  holder  or  of  any  beneficiary  named  in  a  certificate, 
or  any  person  who  may  have  any  right  thereunder.  (Laws  1897, 
p.  132.) 

May  Provide  for  Meeting  of  Legislative  Body  in  Any  Other  State — 
Votes  of  Subordinate  Bodies  in  Other  States. 

Section  1419.  Any  such  association  organized  under  the  laws  of 
this  State  may  provide  for  the  meeting  of  its  legislative  or  govern- 
ing body  in  any  other  State,  province  or  territoi'y  wherein  such 
associations  shall  have  subordinate  liodies,  and  all  business  trans- 
acted at  sueli  meetings  shall  be  valid  in  all  respects,  as  if  such  meet- 
ings were  held  within  this  State,  and  where  the  laws  of  any  such 
association  provide  for  the  election  of  its  officers  by  votes  to  be 
cast  in  its  subordinate  bodies,  the  votes  so  cast  in  its  subordinate 


674  FRATERNAL    SOCIETY    LAW 

bodies  in  any  other  State,  province  or  territory  shall  he  valitl  as  if 
cast  within  this  State.     (Laws  1897,  p.  132.) 

Penalty  for  False  and  Fraudulent  Statement. 

Section  1420.  Any  person,  officer,  member  or  examining  physi- 
cian who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent 
statement  or  representation  in  or  with  reference  to  any  application 
for  membership,  or  for  the  purpose  of  obtaining  any  money  or  bene- 
fit in  any  association  transacting  business  under  this  act,  shall  be 
guilty  of  a  misdemeanor,  and  upon  conviction,  shall  be  punished 
by  a  fine  of  not  less  than  $100  nor  more  than  $500,  or  by  imprison- 
ment in  the  county  jail  for  not  less  than  thirty  days  nor  more 
than  one  year,  or  both,  in  the  discretion  of  the  court;  and  any 
person  who  shall  wilfully  make  any  false  statement  of  any  material 
fact  or  thing  in  a  swoi'u  statement  as  to  the  death  or  disability 
of  a  certificate  holder  in  any  such  association  for  the  purpose  of 
procuring  payment  of  a  benefit  named  in  the  certificate  of  such 
holder,  and  any  person  who  shall  willfully  make  any  false  state- 
ment in  any  verified  report  or  declaration,  under  oath  required  or 
authorized  by  this  act,  .shall  be  guilty  of  perjury,  and  shall  be  pro- 
ceeded against  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  perjury.     (Laws  1897,  p.  132.) 

Penalty  for  Refusing  or  Neglecting  to  Make  Report — Duty  of  Super- 
intendent of  Insurance — Injunction,  Etc. 

Section  1421.  Any  such  association  refusing  or  neglecting  to 
make  the  report  as  provided  in  this  act,  or  to  appoint  the  superintend- 
ent of  the  insurance  department  as  its  true  and  lawful  attorney  for 
the  purpose  of  this  act,  shall  be  excluded  from  doing  business  witliin 
this  State.  Said  superintendent  of  the  insurance  department  must, 
within  sixty  days  after  failure  to  make  such  report,  or  in  any  case 
any  such  association  shall  exceed  its  powers,  or  shall  conduct  its 
business  fraudulently,  or  shall  fail  to  comply  with  any  of  the  pro- 
visions of  this  act,  give  notice,  in  writing,  to  the  attorney-general, 
who  shall  immediately  commence  an  action  against  any  such  asso- 
ciation   to   enjoin   the   same   from    cai'ryinu'   on    any  business.      And 


THE    STATE    OF   MISSOURI  575 

no  injunction  against  any  sueli  assoeialion  shall  be  gr-anti'(|  hy  any 
court,  except  on  application  by  the  alorney-general  at  the  re(|iiest  of 
the  .superintendent  of  the  insurance  department.  Xo  association 
so  eii.joined  shall  have  authority  to  contimu'  busiiU'ss  until  such 
report  shall  be  made,  or  overt  act  oi'  violations  rdinphiined  of  shall 
have  been  corrected,  nor  until  the  (M)sts  of  such  action  be  paid  by 
it:  Provided,  the  court  shall  tind  that  such  association  was  in 
default  as  charged.  Whereupon  the  superintendent  of  the  insur- 
aiu'c  department  shall  reinstate  sueli  assoeiation,  ;ind  not  until 
then  shall  such  association  be  allowed  to  again  tlo  business  in  this 
State.  Any  officer,  agent  or  person  acting  for  any  association  or 
subordinate  body  thereof  within  this  State,  while  such  association 
shall  lie  so  enjoined  or  prohibited  from  doing  business  pursuant 
to  this  act,  shall  be  deemed  guilty  of  a  misdemeanor,  and  on  eon- 
viction  thereof,  shall  be  punished  by  a  tine  not  less  than  -$2.5  nor 
more  than  $200,  or  by  imprisonment  in  the  county  jail  for  not  less 
than  thirty  days  nor  more  than  one  year,  or  by  both  such  fine  and 
imprisonment,  in  the  discretion  of  the  court.     (Laws  1897,  ji.  132.) 

Failing  to  Comply  With  Article — Agent  Guilty  of  Misdemeanor. 

Section  1422.  Any  person  who  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise  for  any  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  sliall  have  violated 
any  of  the  provisions  of  this  act,  or  shall  have  failed  or  neglected 
to  procure  from  the  superintendent  of  the  insurance  department 
a  proper  certificate  of  authority  to  transact  business  as  provided 
for  by  this  act,  shall  be  subject  to  the  penalty  provided  in  the  last 
preceding  section  for  the  misdemeanor  therein  specified.  (Laws 
1897,  p.  132.) 

Article  Not  Applying  to  Masons — Odd  Fellows  or  Similar  Orders. 

Section  1423.  This  act  shall  not  apply  to  or  affect  grand  or  sub- 
ordinate lodges  of  Masons,  Odd  Fellows,  or  similar  orders  paying 
only  sick,  disability  or  funeral  benefits  or  any  association  not  work- 
ing on  the  lodge  system,  which  limits  its  certificate  holders  or  mem- 
ber.ship   to   n    particular   class   or   to   the   em]iloyes   nf   n    particular 


576  FRATERNAL    SOCIETY    LAW 

town  or  city,  designated  firm,  business  house  or  corporation :  Pro- 
vided, that  associations  of  commercial  travelers  and  those  employing 
commercial  travelers  incorporated  as  fraternal  benefit  associations 
or  societies  shall  in  all  respects  be  subjected  to  the  provisions  of 
this  act.      (Amended,   Laws  1901.) 

Be  it  enacted  l)y  the  General  Assembly  of  the  State  of  Missouri, 
as  follows: 

Section  1.  If  any  foreign  or  non-resident  insurance  company, 
corporation,  association  or  concei'n  of  any  kind,  ineludhig  fraternal 
or  beneficial  associations  or  corporations  and  surety  companies  or 
corporations,  organized  and  incorporated  under  the  laws  of  any 
other  State,  territory  or  country,  and  doing  business  in  this  State 
under  the  laws  of  this  State  regulating  and  authorizing  the  licens- 
ing of  any  such  company,  corporation,  association  or  concern  by 
the  superintendent  of  the  insurance  department  of  this  State,  shall, 
without  the  written  consent,  given  and  obtained  after  the  filing 
of  such  suit  or  proceeding  in  the  State  court,  of  the  other  party 
to  any  suit  or  proceeding  brought  bj^  or  against  it  in  any  court  of 
this  State,  whether  suit  or  proceeding  be  pending  in  the  State  at 
the  time  of,  or  be  broiight  after  the  taking  effect  of  this  act.  remove 
said  suit  or  proceeding  to  any  federal  eoi;rt.  or  shall  institute 
any  suit  or  proceeding  against  any  citizen  of  this  State  in  any 
federal  court,  it  shall  be  the  duty  of  the  superintendent  of  the 
insurance  department  to  forthwith  revoke  all  authority  to  such  com- 
pany, corporation,  association  or  concern,  and  its  agents,  to  do 
business  in  this  State,  and  such  company,  eorjioratiou.  association 
or  concern  shall  not  again  be  authorized  or  permitted  to  do  busi- 
ness in  this  State  at  any  time  within  five  years  from  the  date  of 
such  revocation.  And  the  superintendent  shall  publish  such  revo- 
cation in  at  least  six  newspapers  of  large  anil  general  circulation 
in  the  State.  Provided,  however,  that  the  revocation  of  such  au- 
thority shall  not  in  any  manner  effect  the  duties  and  liabilities  of 
any  such  company,  corporation,  association  or  concern  under  any 
policy  or  contract  of  insurance  issued  by  it  ]irior  to  and  in  force 
at  the  lime  of  the  revocation  of  such  aiillmrily. 

.Vpprnvcd  :\[arcli  19.  1907. 


THE    STATE    OF    MISSOURI  577 

Suicide  Provision  in  Contract  Valid. 

A  section  of  the  general  insurance  laws  providing  that  suicide 
shall  not  be  a  dofeiise  to  a  life  insurance  contrMct,  unless  the  member 
contemplated  suicide  when  he  made  application  therefor,  was  held 
not  to  be  applicable  to  a  fraternal  society  in  a  suit  upon  a  certificate 
issued  under  the  fratenini  licneficiary  law  of  Missouri  which  was 
adopted  in  1897. 

Tice   vs.   Supreme   Lodge   Knights   of   Pythias,   May.   1907,   Supreme 
Court  of  Missouri.  102  S.  W.  1013. 

All  Members  Not  Required  to  be  Benefit  Members. 

It  is  not  uecessai-y  that  all  of  the  memliers  of  a  fraternal  society 
shall  carry  insurance  certificates,  a  part  only  may  carry  such  cer- 
tificates. Such  of  the  members  as  do  may  be  segregated  into  a  class 
by  themselves  separate  from  the  other  members  of  the  society. 

Westerman  vs.  Supreme  Lodge  Knights  of  Pythias.  June.  1906.  196 
Mo.  670. 

Fraternal  Society  Defined. 

It  is  only  essential  to  constitute*  a  society  a  fraternal  beneficiary 
association  within  the  meaning  of  the  statute  that  it  shall  be  or- 
ganized for  the  benefit  of  its  members,  not  for  gain  or  profit,  shall 
have  a  representative  formed  on  government,  ritualistic  form  of 
work,  and  make  provision  for  the  payment  of  benefits  in  the  case 
of  the  death  of  its  member. 

Westerman  vs.  Supreme  Lodge  Kniglits  of  Pythias,  June.  1906,  196 
Mo.  670. 

Fraternal  Society  Contracts  Subject  to  be  Forfeited. 

The  certificates  issued  in  a  society  do  not  fall  within  the  provision 
of  the  non-forfeiture  insurance  statutes  of  this  State.     That  statute 
is  limited   in   its  application   to  regular  or  old  line  life  insurance 
companies. 
37 


578  FRATERNAL    SOCIETY    LAW 

Westerman  vs.  Supreme  Lodge  Knights  of  Pythias,  June,  1906,  196 
Mo.  670. 

Long  Established  Custom  Aid  in  Construction  of  Statutes. 

The  ruling  of  the  insurance  department  of  the  State  and  the  legal 
profession,  and  the  acquiescence  of  the  people  generally  of  the  State 
for  more  than  a  quarter  of  a  century  after  the  enactment  of  the 
non-forfeiture  statute,  that  the  same  is  not  applicable  to  contracts 
made  in  fraternal  societies,  standing  alone  by  themselves  and  do  not 
furnish  satisfactory  grounds  for  so  holding;  but  for  other  reasons 
which  can  be  assigned  to  the  effect  that  it  is  not  so  applicable ;  such 
rulings  furnish  aid  and  support  to  the  soundness  of  the  reasons. 

Westerman  vs.  Supreme  Lodge  Knights  of  Pythias.  June.  1906,  196 
Mo.  670. 

Obligations  and  Benefits  Flexible  and  Subject  to  Change. 

The  payments  due  from  members  and  the  benefits  to  be  paid  by  the 
society  are  neither  unalterably  fixed  nor  definitely  fixed  and  un- 
changeable when  the  society  in  its  agreements  has  provided  that 
they  are  subject  at  all  times  to  be  changed,  in  accordance  with  tfie 
reserve  power  in  the  society  to  amend  its  laws. 

Westerman  vs.  Supreme  Lodge  Knights  of  Pytliias.  June.  1906.  196 
Mo.  670. 

Fraternal    Society    Contracts    Not    Under    State    Non-Forfeiture 
Statutes. 

Whether  or  not  any  of  the  provisions  of  the  general  insurance  laws 
of  the  State  are  applicable  to  contracts  made  by  fraternal  societies, 
depends  in  part  upon  the  form  of  tlie  contract  and  its  terms  and  in 
part  ujion  thi>  provisions  of  the  laAV  involved.  Certain  provisions  of 
the  general  insurance  laws  may  be  broad  enough  to  embrace  such 
contracts,  but  a  benefit  certificate  which  complies  with  the  pro- 
vision of  the  laws  governing  fraternal  societies,  is  not  subject  to  the 
non-forfeiture  provisions  of  the  freiici'al  insurance  laws. 


THE    STATE    OF    MISt<OURI  579 

Westerman   vs.  Suprenie  Lodgo  Knights  o£  Pythias,  June.  li)ii»;.  196 
Mo.  670. 

Beneficiaries  Have  no  Vested  Interests. 

The  beiicliciaries  of  iiicmbiTs  of  a  fraternal  society  have  im  Nc^sted 
interest  in  the  eontracts,  and  hence  the  act  of  1897,  e-Kenijiting  fra- 
ternal societies  from  the  general  insurance  laws,  nuiy  he  made  to 
apply  to  the  contracts  then  in  force  without  impairing  the  obliga- 
tions of  the  contract,  or  being  retrospective  in  so  far  as  the  bene- 
tieiaries  are  concerned. 

Westerman   vs.   Supreme  Lodge  Knights  of  Pythias,   .June,   IDni;.   196 
Mo.  670. 

Contract  Forfeited  Under  Amended  Law — No  Damages  Recoverable 
for  Failure  to  Obtain  Insurance. 

When  a  life  instirance  company  has  declared  a  member's  contract 
forfeited  for  non-payment  of  an  increased  rate  or  premium  from  that 
charged  at  the  time  the  contract  was  made,  the  member  is  not  en- 
titled to  recover  damages  due  to  his  inability  to  obtain  further  life 
insurance  ou  account  of  his  advanced  age,  such  damages  being  too 
remote  and  speculative  to  constitute  the  foundation  foi-  a  legal 
cause  of  action. 

Ijams  vs.  Provident  Savings  Life  Assurance  Society,  Deeemljer.  1904, 
185  Mo.  466.  , 

Definition  of  "Level  Rate"  Contract. 

As  to  what  is  meant  by  a  level  rate  contract  of  insurance,  see 

Ijams  vs.  Provident  Savings  Life  Assurance  Society,  December.  1904, 
185  Mo.  466. 

Forfeiture,  Self-executing  Provisions. 

When  tlie  laws  of  a  society  provide  that  failure  to  pay  dues  for  a 
month  after  which  they  are  due  shall  operate  to  suspend  the  mem- 
ber, his  failure  to  make  such  payment  ipso  facto  suspends  him,  and 


580  FRATERNAL    SOCIETY    LAW 

no  action  is  required  on  the  part  of  the  officials  of  the  society.  This 
is  true  although  the  member  may  be  delirious  and  unconscious  at 
the  time  the  assessment  became  due. 

Smith  vs.   Sovereign  Camp  Woodmen  of  tlie  World.  Dec,   1903.  179 
Mo.  119. 

Forfeiture  of  Member  Delirious  When  Assessment  Due. 

For  the  facts  in  a  case  where  the  forfeiture  of  a  member  while 
sick  was  alleged  and  also  the  fact  concerning  his  reinstatement,  see 

Smith  vs.   Sovereign  Camp  Woodmen  of  the  World,  Dec,  1903,  179 
Mo.  119. 

« 

Fraternal  Societies  Exempt  From  General  Insurance  Laws. 

The  fraternal  act  of  1879  was  expressly  limited  to  societies  organ- 
ized or  to  be  organized  under  the  provisions  thereof,  and  had  no 
application  to  societies  organized  under  the.  laws  of  other  states. 
The  act  of  1889,  exempting  fraternal  societies  from  the  general  in- 
surance laws  was  held  to  expressly  be  confined  to  fraternal  societies 
organized  under  the  laws  of  Missouri;  that  from  1881  to  1889  for- 
eign societies  were  exempted,  but  from  1889  to  1897  they  were  uot 
so  exempted. 

Kern  vs.   Supreme  Council   Legion  of  Honor,  March,   1902.   167  Mo. 
471, 

The  Kern  case  was  cited  and  explained  in  We-stermaii  vs.  Su- 
preme Lodge  Knights  of  Pythias,  196  Islo.  CuO. 

Fraternal  Society  Laws  May  Restrict  Liberty  of  Members. 

Under  the  laws  of  the  State  members  of  any  religious  denomina- 
tion may  form  a  fraternal  society  and  mny  enact  laws  prescribing 
that  only  members  of  a  certain  faith  shall  belong  to  such  society 
and  may  expel  members  for  a  failure  to  observe  the  duty  pre- 
scribed by  the  cluircb  of  such  iMitli.  By-laws  with  i-cspeet  to  such 
matters  dn  not    viohite  the   pi'dvisioiis  of  tlir  l)ill  of  rights. 


THE    STATE    OF    M/SHOllIil  581 

Franta  vs.  Bohemian  Roman  Catholic  Union,  June.  1901,  ]fi4  Mo.  304. 

Distinctions  Between  Old  Line  and  Assessment  Insurance. 

As  to  the  distinctions  between  ;i  ])iirely  assessment  insurance  so- 
ciety and  an  old  line  company,  but  luit  discussing  fraternal  society 
questions,  see 

Aloe  vs.  Fidelity  Mutual  Life  Association,  Feb.,  1900,  164  Mo.  675. 

Fraternal  and  Assessment  Societies  Exempt  From  General  Insurance 
Statutes. 

Under  the  act  of  1889  jjrovidint;-  that  suicide  should  not  be  a 
defense  unless  the  member  contemplated  suicide  at  the  time  of 
joining  the  society,  was  held  not  to  apply  to  assessment  societies  nor 
to  fraternal  societies. 

Toomey  vs.  Supreme  Lodge  Knights  of  Pythias,  Dec,  1S98,  147  Mo. 
129. 

Contract — Nature  of  Determines  Character  of  Society. 

The  classification  of  an  insurance  company  is  not  determined  by 
its  name,  but  by  its  contract;  and  where  the  premiums  are  fixed 
and  the  benefits  are  likewise  fixed,  the  contract  is  that  of  an  old  line 
insurance  society  under  the  statutes  enacted  in  1889. 

Toomey  vs.  Supreme  Lodge  Knights  of  Pythias,  Dec,  1898.  147  Mo. 
129. 

Assessments,  Definite  and  Fixed. 

For  an  opinion  discussing  life  iusurauce  upon  the  assessment  plan, 
fixed  premiums,  immaterial  misrepresentations,  etc.,  see 

Jacobs  vs.  Omaha  Life  Association,  Dec,  1898.  146  Mo.  523. 


582  FRATERNAL    iiOVlETY    LAW 

Assessment,  Receipt  of  Acknowledged  in  Contract  Not  Subject  to 
be  Questioned. 

Where  a  contract  recites  the  payment  of  premium  the  society  will 
not  he  permitted  to  deny  the  receipt  of  such  premium,  and  the  con- 
tract will  be  held  to  be  in  force  for  the  length  of  time  covered  by 
the  receipt,  whether  the  premiums  were  paid  or  not. 

Dobyns  vs.   Tte  Bay   State  Beneficiary  Association,   May.   1898.  144 
Mo.  95. 

Assessment  Plan  of  Insurance,  What  is. 

The  Inirden  of  proof  is  on  the  society  to  show  that  it  is  on  the 
assessment  jtlan  when  such  fact  is  put  in  issue  by  the  pleadings. 
What  is  an  assessment  society  is  discussed  by  the  conrt  in  this  case. 

Jacobs  vs.  Omaha  ^^ife  Association,  Dec,  1897,  142  Mo.  49. 

Contract,  When  Regarded  as  Made  in  Missoviri. 

For  the  facts  in  a  case  upon  a  benefit  certificate  where  evidence 
was  considered  and  held  sufficient  to  sustain  a  verdict  that  the  in- 
sured was  a  resident  of  the  State  of  Missouri  so,  as  to  render  the 
statute.s  of  that  State  apjilicable  to  the  construction  of  the  contract 
in  spite  of  the  fact  that  the  member's  application  gave  his  residence 
as  Kansas,  see 

Kroge   vs.   Modern   Brotlierhood   of  America.   Kansas   City  Court  ot 
Appeals,  Dec,  1907,  105  S.  W.  685. 

Society  Making  Certificates  Payable  to  "Legal  Representatives," 
Not  a  Fraternal  Society. 

A  foreign  fraternal  society  authorized  to  issue  certificates  payable 
to  the  legal  representatives  of  the  member  is  held  not  to  be  a  fra- 
ternal beneficiary  society  under  the  laws  of  this  State. 

Kroge   vs.   Modern    Brotherhood    of   America,    Kansas   City   Court   ot 
Appeals.  Dec,  1907.  105  S.  W.  685. 


THE    UTATE    OE    MISSOURI  583 

Certificate,  Presumption  as  to  Amount  of  One  Assessment. 

In  an  action  on  a  certificate  for  $1,000,  in  the  absence  of  proof 
of  what  would  have  been  the  proceeds  of  an  nssossmoiit  it  will  be 
presumed  that  an  assessment  would  have  paid  in  full  the  amount 
named  in  the  certificate. 

Kroge   vs.   Modern    Brotherhood   of   Ameriia.   Kansas   City   Court  of 
Appeals,  Dec,  1907,  105  S.  W.  685. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

An  insurer  waives  proof  of  loss  by  denying  liability  on  a  contract. 

Hays  vs.  General  Assembly,  American  Benev.  Assn.,  St.  Louis  Court 
of  Appeals,  Oct.,  1907,  104  S.  W.  1141. 

Foreign  Society,  Requisites  of  Pleading  and  Proof. 

A  foreign  society  wh.en  sued  on  a  certificate  issued  by  it,  in  order 
to  I'eceive  the  benefit  of  the  laws  and  rules  of  construction  pertain- 
ing to  death  benefit  certificates  issued  by  fraternal  societies,  must 
plead  and  prove  not  only  that  it  possesses  the  essential  qualifications 
of  such  a  society,  as  prescribed  by  the  statutes  of  this  State,  but 
also  that  it  has  been  admitted  to  do  business  in  this  State  in  the 
manner  provided  by  law. 

Gruwell  vs.  National  Council,  Knights  and  Ladies  of  Security,  Kan- 
sas City  Court  of  Appeals,  Oct..  1907,  104  S.  W.  884. 

Forfeiture  for  Non-payment  Must  be  Based  on  Agreement. 

Stipulations  in  the  contract  of  insurance  providing  that  non-pay- 
ment of  premiums  shall,  ipso  facto,  work  a  forfeiture  without  notice 
to  the  delinquent,  are  enforcible,  but  in  the  absence  of  any  stipula- 
tion for  forfeiture  on  the  ground  of  non-payment,  the  contract  re- 
mains in  force  during  the  lifetime  of  the  insured,  however  de- 
linquent he  may  become  wnth  respect  to  agreed  payments. 

Gruwell  vs.  National  Council.  Knights  and  Ladies  of  Security,  Kan- 
sas City  Court  of  Appeals,  Oct.,  1907,  104  S.  W.  884. 


584  FRATERNAL    SOCIETY    LAW 

Evidence,  Privilege  of  Physicians  Waived. 

Where  the  applicant  in  his  application  expressly  waived  for  him- 
self and  his  beneficiaries  benefits  of  all  laws  disqualifying  any  physi- 
cian from  testifying  concerning  any  information  obtained  in  a  pi'o- 
fessional  capacit.y,  neither  the  member  nor  his  beneficiary  can  object 
to  the  testimony  of  a  physician  whom  the  member  had  consulted 
professionally. 

Modern  Woodmen  of  America  vs.  Angle,  St.  Louis  Court  of  Appeals, 
June,   1907,   104  S.  W.  297. 

Conditions  Precedent,  Truthfulness  of  Statements. 

An  application  for  a  certificate  required  the  applicant  to  answer 
whether  within  seven  years  he  had  consulted  a  physician  as  to 
personal  ailment,  and  if  so  to  give  dates,  ailment,  duration  of  attack, 
physicians'  names  and  addresses,  and  to  state  whether  the  recovery 
was  complete.  The  application  further  provided  that  the  answers 
should  be  treated  as  warranties,  and  the  certificate  issued  made  the 
application  a  part  thereof  and  provided  that  the  same  should  be 
void  if  the  answers  were  not  true.  Held,  that  the  truthfulness  of 
the  answers  to  such  questions  was  a  condition  precedent  to  the  en- 
forcement of  the  contract,  so  that,  the  member  having  omitted  to 
disclose  that  he  had  consulted  a  certain  physician  for  hemorrhages 
sixty  days  before  the  date  of  the  application,  the  certificate  was 
void. 

Modern  Woodmen  of  America  vs.  Angle,  St.  Louis  Court  of  Appeals, 
June,  1907,   104  S.  W.   297. 

Member  Bound  by  Statements  in  Application. 

"With  respect  to  the  binding  force  of  the  application  and  the 
information  contained  therein  the  Court  announced  the  following  to 
be  the  rule : 

"Now,  it  is  well  established  in  the  bnv  of  insurance  that  when  the 
agent  has  written  down  untrue  answers  to  such  questions,  even 
though  it  be  done  without  the  knowledge  of  the  insured,  and  the 


I 


THE    STATE    OF    MISSOURI  586 

insured  is  furnished  a  copy  of  the  application  containing  such  un- 
true answers  annexed  to  the  policy,  he  is  afterwards  estopped  from 
denying  knowledge  thereof.  The  doctrine  of  course  proceeds  on  the 
theory  that  it  is  the  duty  of  the  insured  to  use  reasonable  diligence 
ill  discovering  the  contents  of  the  contract,  and  it  is  said  upon  dis- 
covering the  same  it  becomes  his  duty  to  notify  the  company  of  such 
fraud  perpetrated  upon  both  himself  and  the  insurer.  At  any  rate, 
if  he  hold  the  policy,  referring  in  apt  terms  to  the  warranties  con- 
tained in  the  application  annexed,  for  a  reasonable  length  of  time, 
he  is  conclusively  j)resumed  to  know  the  contents  of  the  contract  and 
the  untruthful  answers  pin  inly  written  in  the  application,  and  is 
thereby  estopped  to  tissert  that  he  had  no  knowledge  on  the  sub- 
ject." 

Modern  Woodmen  of  America  vs.  Angle.  St.  Louis  Court  of  Appeals, 
June,  1907,  104  S,  W.  297. 

Foreign  Society,  Suicide  Provisions  Valid. 

An  application  for  insurance  in  a  fraternal  society  which  had  not 
been  authorized  to  do  business  in  this  State  provided  that  if  the 
applicant  dies  by  suicide  no  indemnity  should  be  paid :  that  he  should 
be  governed  by  the  by-laws  then  in  force  or  thereafter  enacted  limit- 
ing the  rights  of  his  beneficiary ;  and  Avhere  the  by-laws  at  the  time 
of  his  application  and  until  the  time  of  his  death  provided  that 
suicide  .should  void  the  contract,  and  after  the  certificate  was  issued 
the  society  complied  with  the  law  authorizing  it  to  do  business  in 
this  State,  it  was  held  that  when  the  insured  committed  suicide  there 
was  good  defense  to  an  action  on  the  contract. 

Schmidt  vs.  tJnited  Order  of  Foresters,  April,  1907,  124  Mo.  App.  165. 

Suicide  Provisions  Valid. 

Where  the  application  for  insurance  and  the  by-laws  of  the  society 
showed  it  to  be  a  fraternal  society,  it  was  entitled  to  immunity  from 
the  provisions  of  Section  7896  relating  to  suicide,  conferred  upon 
fraternal  societies  by  Section  7913. 

Schmidt  vs.  tJnited  Order  of  Foresters,  April,  1907.  124  Mo.  App.  165. 


586  FRATERNAL    SOGIETT    LAW 

After-enacted  Laws  Valid. 

The  rule  that  a  fraternal  society  cannot  by  a  by-law  enacted  sub- 
sequent to  the  issuance  of  the  certificate,  take  away  part  of  the  bene- 
fit provided  for  in  the  certificate,  does  not  apply  in  a  case  where  the 
society  was  not  admitted  to  do  business  in  the  State  at  the  time  of 
the  issuance  of  the  certificate  as  a  fraternal  society,  but  subsequently 
qualified,  and  where  it  was  shown  that  the  intention  of  the  member 
was  that  he  should  be  bound  by  such  laws. 

Schmidt  vs.  United  Order  of  P^oresters,  April,  1907,  124  Mo.  App.  165. 

After-enacted  Laws  Valid  When  Within  Terms  of  AgTeement. 

A  member  of  a  fraternal  society  is  boinid  by  such  reasonable  regu- 
lations and  by-laws  of  the  society,  adopted  after  he  becomes  a  mem- 
ber, as  are  clearly  contemplated  by  his  agreement. 

Lewine  vs.  Supreme  Lodge,  Knights  of  Pythias,  Feb.,  1907,  122  Mo. 
App.  547. 

After-enacted  Suicide  Law  Not  Binding,  When. 

Benefit  certificates  are  essentially  contracts  of  insin-aiice  and  are 
controlled  by  the  laws  governing  the  construction  and  interpretation 
of  contracts  generally,  and  cannot  be  altered  or  modified  by  the 
society  issuing  same  without  the  express  assent  of  the  members ;  but 
the  holder  of  a  certificate  may  by  express  contract  bind  himself  by 
such  future  by-laws  as  may  modif.y  his  contract  of  insuratice.  Where, 
in  the  application  for  membership,  the  member  had  agreed  that 
"this  contract  shall  be  controlled  by  all  the  laws,  rules  and  regula- 
tions of  the  order  now  in  force  or  that  may  hereafter  be  enacted," 
it  was  held  not  to  empower  the  society  to  enact  a  by-law  reducing  the 
amount  to  be  paid  in  case  the  member  committed  suicide. 

Lewine  vs.  Supreme  Lodge,  K.  of  P.,  Feb.,  1907,  122  Mo.  App,  547. 

After-enacted  Laws,  How  Far  Binding. 

A  member  of  a  fraternal  society  mav  ae:ree  in  advance  to  be  con- 


THE    STATE    OF    MISSOURI  5j^7 

trolled  and  governed  by  the  ];ivvs  then  in  forcr  nr  that  may  thei-cafti-r 
be  ennctcd  by  the  society,  but  in  this  Statr  i1  is  held  that  siu'h  an 
ajirccnicnl  applies  (inly  to  Ihc  (liitics  of  \]\o  iiiciiiIkm-  nial<in^'  tin- 
agreement,  and  docs  not  authorize  the  society .  witlmul  liis  assent, 
to  change  or  modify  his  contract  of  insurance. 

Zimmerman  vs.  Supreme  Tent.  Knipilits  of  the  Maccabees,  Feb.,  1907, 
122  Mo.  App.  591. 

St.  Louis  Court  of  Appeals  Opinions  Conflicting. 

(It  would  sei-ni  that  the  .St.  Lonis  ('ourt  of  Ajipeals.  whieh  handed 
down  oi)inions  in  the  Lewine  and  tlie  Zininiernian  cases,  supra,  l>iith 
on  the  same  day  (February  o,  1907),  is  not  altogether  harmonious 
on  the  doctrine  of  the  validity  and  binding  fdi'ce  of  after-enacted 
by-laws.  In  the  Lewine  case  the  court  expressly  holds  that  an  after- 
enacted  by-law  may  affect  the  amount  of  the  benefit  that  a  bene- 
ficiary is  to  receive  under  his  certificate,  provided  that  apt  language 
has  been  employed  in  the  agreement  showing  the  assent  of  the 
member  to  the  condition  that  his  benefit  may  be  reduced;  while  in 
the  Zimmerman  case  the  court  seems  to  lay  down  the  proposition, 
broadly,  that  no  agreement  of  the  kind  will  be  valid. — Editor.) 

After-enacted  Suicide  Law  Held  Invalid  as  to  Contracts  in  Force. 

All  application  for  membership  in  a  fraternal  society  provided 
that  the  member  should  be  bound  by  the  laws  then  in  force  or  those 
that  might  thereafter  be  adopted.  A  by-law  then  in  force  provided 
that  if  a  member  committed  suicide  within  five  years  after  his  ad- 
mission, his  beneficiary  would  be  entitled  only  to  the  amount  paid 
in,  and  subsequently  a  by-law  was  enacted  removing  the  limit  of 
time  so  that  the  beneficiary  would  receive  only  the  amount  paid  in 
if  at  any  time  the  member  suicided.  A  member  committed  suicide 
after  the  expiration  of  five  years  from  the  date  of  his  certificate, 
and  it  was  held  that  he  was  not  bound  by  the  change  in  the  by-laws, 
because  its  etiPect  was  to  impair  his  contract,  and  that  his  beneficiary 
could  recover  the  full  amoinit  provided  in  his  certificate. 

Zimmerman  vs.  Supreme  Tent,  Knights  of  the  Maccabees.  Feb  .  1907, 
122  Mo.   App.  .591. 


588  FRATERNAL    SOCIETY    LAW 

Forfeiture  Requisites  in  Pleading. 

An  answer  to  an  action  on  a  certificate  pleaded  that  the  by-laws 
required  certain  payments  and  that  the  member  had  not  made  the 
same.  Held,  that  the  pleading  was  insnfificient,  since  it  should  set 
out  the  laws  of  the  State  of  its  incorporation  and  its  own  laws 
showing  the  requirement  for  such  payment. 

Johnson  vs.  Sovereign  Camp,  Woodmen  of  the  World,  June,  1906,  119 
Mo,  App.  98. 

Assignment  of  Fund  When  Valid. 

The  beneticiai'y  in  a  certificate  entered  into  an  agreement  with 
the  deceased  member's  heirs  whereby  she  agreed  to  divide  the 
amount  sjiecified  to  be  paid  under  the  certificate  when  the  same  was 
received.  It  was  held  there  was  no  present  transfer,  and  that  the 
heirs'  rights  were  not  to  attach  until  some  future  time,  and  that 
the  contract  was  merely  executory,  since  to  make  an  assignment, 
even  in  equity,  the  assignor  must  not  retain  any  control  over  or 
power  to  collect  the  fund. 

Banholzer  vs.  Grand  Lodge,  A.  O.  U.  W.,  June,  1906,  119  Mo.  App,  177, 

Beneficiaries,  Classes  Determined  by  Lawrs  of  Missouri. 

No  oue  can  become  a  beneficiary  under  a  fraternal  certificate  who 
does  not  belong  to  some  one  of  the  classes  of  persons  named  as  such 
in  the  statute.  Wliere  a  society  is  organized  in  one  State  and  per- 
mitted to  do  business  as  a  foreign  corporation  in  another  State,  the 
statute  of  the  latter  will  determine  who  can  be  beneficiaries  in  cases 
originating  therein. 

Dennis  vs.  Modern  Brotherhood  of  America,  June,  1906,  119  Mo.  App. 
210. 

Forfeiture,  Reinstatement,  Requisites  of. 

The  by-laws  of  a  society  reqiiired  a  lapsed  member  seeking  rein- 
statement to  furnish    a   certificate  of  good  health    from   the   camp 


I 


THE    /STATE    OF    MWSOUlil  689 

physician  ou  a  pru.surilied  I'onn,  after  medical  examination.  A  lapsed 
iiieiiilxT  spent  three  hours  in  otiier  business  with  the  cam])  physician, 
ami  siihsc((iiriil  ly  on  the  same  day  wrote  a  eei'liliealr  whirh  tile 
piiysiciau  gave  without  examination.  It  was  h(>ld  that  the  camp 
physician  was  the  agent  of  the  member,  whose  duty  it  was  to  have 
liiiiiself  I'xamiued  in  order  to  secure  the  certificate,  and* that  he 
couhl  nut  be  reinstati-cl  until  lie  had  submitted  a  trntiii'nl  ci'ilificate, 
since  tlu'  by-law  was  intended  to  protect  thi?  society  from  collusion 
between  tlie  member  and  the  camp  physician. 

Warner  vs.  Modern  Woodmen  of  America.  June,  ll)i»i;,  119  Mo.  App. 
222. 

Beneficiaries,  Rule  as  to  Changes  of. 

Where  the  constitution  of  a  society  provided  tliat  if  a  member 
should  fail  to  designate  his  beneficiary  on  the  books  of  the  society, 
the  death  fund  shoidd  be  paid  to  his  heirs  at  law.  the  failure  to 
designate  a  beneficiar3'  according  to  the  nn'tinid  provided  in  the 
constitution,  when  such  method  was  merely  contractual  and  not  en- 
forced by  the  society,  did  not,  ipso  facto,  operate  as  a  designation 
of  the  heirs  at  law  within  the  meaning  of  the  constitution  so  as 
to  require  a  compliance  with  the  provisions  of  the  constitution  rela- 
ting to  a  change  of  beneficiary  in  order  to  divest  them  of  any  right 
so  acquired. 

St.  Louis  Police  Relief  Assn.,  vs.  Tierney.  Jan..  1906,  116  Mo.  App.  447. 

Beneficiary,  Designation  Required. 

Where  a  member  designated  his  wife  as  his  beneficiary,  and  then 
severed  his  connection  with  the  society  and  afterwards  became  a 
member  a  second  time,  the  former  designation  had  no  force  or  effect 
unless  both  the  member  and  the  society  adopted  it  as  the  proper 
designation  under  the  second  conti-act. 

St.  Louis  Police  Relief  Assn.,  vs.  Tierney.  Jan..  1906.  116  Mo.  App.  447. 


590  FRATERNAL    SOCIETY   LAW 

Beneficiaries,  Changes  of  Made  at  Will  by  Member. 

Section  1417  of  the  Revised  Statutes  of  1899,  providing  that  no 
contract  between  a  member  and  his  beneficiary  shall  give  the  bene- 
ficiary a  vested  right  in  his  certificate,  has  no  retrospective  opera- 
tion. The  beneficiary  named  has  no  vested  interest  when  the  law 
governing  fraternal  societies  neither  expressly  authorizes  nor  pro- 
hibits a  change  of  name  of  the  beneficiary.  A  member  may  change 
his  beneficiary  at  will  providing  it  is  done  according  to  the  rules 
and  regulations  of  the  society  relating  to  such  change. 

Grand  Lodge  A.  O.  U.  W.  vs.  O'Malley,  Oct..  1905.  114  Mo.  App.  191. 

Beneficiary,  Equitable  Vested  Interest. 

Where  a  beneficiary  with  her  own  means  pays  the  assessments  for 
several  years  and  keeps  the  certificate  alive  until  the  beneficiary  is 
changed,  she  is  entitled  to  the  amount  expended  Avitli  interest  out 
of  the  fund  arising  from  the  certificate  on  the  death  of  the  member. 

Grand  Lodge  A.  O.  U.  W.  vs.  O'Malley.  Oct..  1905.  114  Mo.  App.  191. 

Beneficiary,  Change  of,  Rule  as  to. 

Where  a  member  of  a  society  does  all  in  his  power  to  conform  to 
the  rules  thereof  in  changing  his  beneficiary,  the  society  may  Avaive 
a  strict  comjiliance  with  such  regulations  as  are  solely  for  its  own 
protection:  so  that  a  substantial  compliance  with  its  r\ilcs  will  be 
sufficient.  (This  opinion  conflicts  with  the  decision  of  the  Kansas 
City  Court  of  Appeals  in  Grand  Lodge  v.  Ross,  89  Mo.  App.  621.) 

Grand  Lodge  A.  O.  U.  W.  vs.  O'Malley.  Oct..  1905.  114  Mo.  App.  191. 

Beneficiaries,  Classes  in  Missouri  and  Illinois  Same. 

A  society  organized  under  the  Illinois  act  of  1883.  becomes,  under 
the  amendment  of  1893,  a  fraternal  society  with  beneficiaries  corre- 
sponding to  the  jMi.ssouri  stafntc.  aiul  should  be  considered  as  a  fra- 
ternal society,  since  the  anniuUd  law  is  its  charter  and  determines 
its  cliaracter. 


/ 


THE  STATU  OF  MISSOURI  591 

Pauley  vs.  Modern  Woodmen  of  America,  May,  1905,  113  Mo.  App.  473 

Occupation,  Member  Entering  Against  Prohibition. 

A  provision  in  a  certificate  to  the  effect  that  if  the  member  en- 
gages ill  the  sale  of  liquor.s  tlie  certificate  should  be  foi'feited.  is  in 
the  nature  of  a  warranty  of  his  future  course  of  conduct,  and  his 

violation   thereof  precludes   a    r ivei-y   on    the   certificate,   without 

regard  to  the  action  of  the  society. 

Pauley  vs.  Modern  Woodm'en  of  America.  May,  1905.  113  Mo.  App.  473. 

Suspension  When  Wrongful,  Tender  of  Dues  Must  be  Made. 

A  member  who  has  been  wrongfully  suspended  and  whose  tender 
of  assessment  has  been  refused  is  not  thereby  excused  from  further 
obligation  to  perform,  or  offer  to  perform,  his  duties  as  a  member. 

Lavin  vs.  Grand  Lodge  A.  O.  U.  W..  April,  1905,  112  Mo.  App.  1. 

Suspension,  Acquiescence  by  Member  in. 

Where  a  society  refused  to  accejit  the  payment  by  a  member  of 
one  month's  assessment  when  twice  tendered,  advancing  as  a  reason 
that  the  amount  tendered  was  insufficient,  and  wrongfully  suspended 
the  member  for  non-payment,  and  he  made  no  protest  against  his 
suspension  uor  took  any  steps  to  procure  a  reinstatement,  though  the 
society  had  ample  provision  for  such  procedure,  and  he  made  no 
further  tenders  for  ten  months,  and  died,  he  was  properly  treated 
as  having  abandoned  his  membership,  and  his  beneficiary  could  not 
recover  in  an  action  on  the  certificate. 

Lavin  vs.  Grand  Lodge  A.  O.  U.  W.,  April,  1905,  112  Mo.  App.  1. 

Forfeiture,  Agency  of  Local  Officer,  Waiver  of  Laws. 

A  member  was  injured  on  September  21  and  died  on  the  26th. 
His  August  assessments  were  still  tuipaid.  For  ten  years  he  had 
not  been  prompt  in  paying  his  assessments,  yet  they  were  all  paid 
within  the  three  months'  limitation  provided  in  the  by-laws  for  his 


592  FRATERNAL    SOCIETY    LAW  ^ 

reinstatement,  which  by-laws  suspended  the  certificate  during  the 
non-payment  of  his  assessments.  After  receiving  the  injury  he 
tendered  his  payments  and  they  were  refused.  Held,  that  the  de- 
linquent ipso  facto  became  suspended  upon  default,  but  under  the 
settled  law  of  the  State  the  society  may  waive  compliance  with  its 
laws,  and  that  stipulations  attempting  to  relieve  the  society  from 
such  waivers  are  nugatory,  and  that  the  conduct  of  the  parties  justi- 
fied a  belief  that  the  insurance  continued  in  force  notwithstanding 
the  member's  delinquency. 

Cline  vs.  Sovereign  Camp,  Woodmen  of  the  World,  April,  1905.  Ill 
Mo.  App.  601. 

Conflict  in  Laws,  Those  of  Missouri  Govern. 

Where  in  construing  a  fraternal  contract  issued  by  a  society  or- 
ganized under  the  laws  of  a  foreign  State,  it  is  found  that  the  laws 
of  that  State  and  of  Missouri  are  different,  those  of  the  latter  State 
control. 

Herzberg  vs.  Modern  Brotherhood  of  America.  March,  1905,  110  Mo. 
App.   328. 

Contract  Determines  True  Character  of  Society. 

The  contract  issued  by  a  society  determines  whether  it  operates 
under  the  fraternal  beneficiary  law  or  under  the  general  insurance 
law;  and  the  fact  that  it  calls  itself  a  fraternal  society,  or  that  it 
has  a  permit  to  do  business  as  such,  cannot  affect  the  question. 

Herzberg  vs.  Modern  Brotherhood  of  America,  March,  1905,  110  Mo. 
App.   328. 

Misrepresentation,  Rule  as  to  Pleading. 

In  order  that  a  misrepresentation  of  the  assured  shall  forfeit  a 
contract,  it  must  bo  averred  and  shown  that  the  subject  matter  of 
the  misrepresentation  caused  the  death,  and  the  insurer  must  de- 
posit in  coiirl  ilie  premiums  paid  by  the  assured. 


THE  STATE  OF  MISSOURI  593 

Herzberg  vs.  Modevn  Brotherhootl  of  America,  March.  ISO.').  110  Mo. 
App.   328. 

Construction  of  Contract  Must  Favor  Member. 

Where  tliere  is  a  coiitiiel  l)etweeu  the  ])rovisions  of  a  certificate, 
or  room  for  construction  and  interpretation,  putting  the  obligation 
of  a  warranty  upon  the  assured  should  be  avoided. 

Offineer  vs.   Brotherhooil   of  American   Yeomen.   Nov.,   1904,  109  Mo. 
App.  72. 

Beneficiary,  Death  Before  Member,  Rule  as  to. 

Where  the  beneficiary  named  in  the  certificate  dies  before  the 
insured,  and  no  other  beneficiary  is  named,  the  proceeds  of  the 
certilicate  should  be  paid  as  the  laws  of  the  society  direct  in  case  no 
beneficiary  is  designated. 

Supreme  Council,  Royal  Arcanum  vs.  Bevis,  May.  1904,  106  Mo.  App. 
429. 

Evidence,  When  Are  Claimants  Incompetent  Witnesses. 

Where  the  heirs  of  a  deceased  beneficiary,  who  was  the  wife  of  a 
member,  claimed  the  proceeds  of  the  certificate  under  an  alleged 
agreement  between  the  member  and  the  beneficiary  that  the  latter 
should  receive  the  money  in  payment  of  a  loan  made  by  her  to  him, 
such  heirs  are  not  competent  Avitnesses  to  prove  the  contract  in  an 
action  between  the  society  and  the  administrator  to  determine  the 
disposition  of  the  fund. 

Supreme  Council.  Royal  Arcanum  vs.  Bevis.  May,  1904,  106  Mo.  App. 
429. 

Forfeiture — Status  at  Death  Determines  Contract. 

A  certificate  in  a  society  provided  that  "any  member  failing  to 
pay  his  per  capita  tax  when  due.  and  his  assessments  within  thirty 
days,  forfeits  his  benefit."     Held,  that  failure  to  pay  the  tax  and 
.38 


694:  FRATERNAL    SOCIETY    LAW 

the  assessment  within  the  time  limited  must  concur  before  forfeiture 
can  be  declared,  and  that  an  announced  intention  of  a  member  to 
drop  his  insurance  does  not  in  itself  change  his  legal  status  as  a 
member,  and  it  is  this  legal  status  at  his  death  that  fixes  the  liability 
of  the  society. 

Hyatt  vs.  Legal  Protective  Assn.,  May,  1904,  lOG  Mo.  App.  610. 

After-enacted  Laws  How  Far  Binding. 

Where  a  member  in  his  application  agreed  to  conform  to  the  con- 
stitution and  rules  of  the  order  then  in  force  or  which  might  be 
adopted  thereafter,  he  is  bound  only  by  such  changes  of  rules  and 
regulations  as  relate  to  his  duties  as  a  member  of  the  society,  and 
not  by  changes  which  interfere  with  the  essential  provisions  of  his 
contract  of  insurance,  unless  such  modifications  are  made  with  his 
express  consent. 

Sisson  vs.  Supreme  Court  of  Honor,  Jan.,  1904.  104  Mo.  App.  54. 

Foreign  and  Domestic  Societies  Treated  Alike. 

Under  the  fraternal  beneficiary  statutes,  foreign  and  domestic 
societies  are  placed  upon  the  same  footing  and  are  exempt  from  the 
provisions  of  the  general  insurance  laws,  provided  they  comply  with 
the  provisions  of  the  said  statutes. 

Hudnall  vs.  Jlodern  Woodmen  of  America,  November.  1903,  103  Mo. 
App.  356. 

By-laws,  Waivers  of  as  to  Payments  Allowed. 

Prompt  payment  of  assessments  may  be  waived  by  the  society  or 
its  agent,  or  by  the  course  of  dealing  with  the  insured,  notwith- 
standing the  contract  provides  that  no  alteration  or  disi-hai'yc  of  the 
contract,  waiver  of  forfeiture,  or  granting  of  ]ierniits  of  credits  shall 
b(>  valid  unless  in  wi'iting  and  signed  by  the  ofHeers  of  the  society. 

Andre   vs.   Modern    Woodmen   of   America.   Novemljer.    l!Mi3.    102   Mo. 
App.   377. 


I 


rut:  tiTATE  Of  MISSOURI  595 

Agency,  True  Rule  as  to  and  Extent  of. 

The  law  dctermioes  whose  agent  one  is  from  the  source  of  his  ap- 
pointment ami  the  nature  of  his  duties,  and  it  is  held  tliat  the  clerk 
of  a  local  camp  is  the  agent  of  the  head  eamp,  thmigli  the  by-laws 
stipulate  he  shall  not  be. 

Andre   vs.   Modern  Woodmen   of  America,  November.   1903,   102  Mo. 
App.  377. 


/  Suspension,  Rule  as  to  Waiver  by  Custom. 


The  failure  of  a  mi'iiibei'  fur  more  than  three  moiillis  (o  pay  either 
his  regular  monthly  dues  or  special  assessments  would,  under  the 
constitution  of  the  society,  suspend  his  membership;  but  such  sus- 
pension would  br  waived  where  it  appeared  that  the  society  had 
not  been  in  the  habit  of  enforcing  the  same. 

Courtney  vs.  St.  Louis 'Police  Relief  Assn.,  March.  1903,  101  Mo.  App. 
261. 

After-enacted  Laws  Valid  and  Effect  Contracts  Existing. 

A  eei'tificate  provided  that  on  the  death  of  the  member  the  society 
would  pay  to  his  beneficiary  the  amount  of  one  assessment,  not  ex- 
ceeding two  thousand  dollars,  if  the  insured  had  complied  with  the 
charter,  constitution,  by-laws.  etc.  It  also  provided  that  the  express 
condition  upon  which  it  was  issued  was  that  the  beneficiary's  rights 
should  be  determined  by  the  charter,  constitution,  laws,  rules  and 
regulations  of  the  society  in  force  at  the  time  the  same  was 
pa.yable.  After  the  issuance  of  the  certificate  a  by-law  was 
adopted  providing  that  a  sum  equal  to  one-fourth  of  a  certificate 
must  be  paid  by  members  by  assessments,  failing  which  the  deficit 
would  be  deducted  from  the  face  value  of  the  certificate.  It  was 
held  that  the  certificate  issued  contemplated  the  modification  of  the 
rights  of  the  parties  by  subsequent  by-laws,  and  that  the  change 
made  was  within  the  power  of  the  society,  though  the  member's  eon- 
sent  was  not  obtained. 

Richmond  vs.  Supreme  Lodge,  Order  of  Mutual  Protection.  January, 
1903,  100  Mo.  App.  8. 


596  FHATERNAL     SOCIETY    LAW 

After-enacted  Suicide  Laws  When  Invalid. 

Where  a  society  has  so  interpreted  its  ooiitr;)pts  as  to  render  itself 
liable  thereunder  though  the  member  committed  suicide  while  sane, 
which  contracts  provide  that  the  society  should  not  be  liable  if  the 
member  committed  suicide  within  two  years  after  the  issuance  of  the 
certificate,  and  the  society  by  thereafter  passing  by-laws  providing 
that  if  the  member  committed  suicide  his  beneficiary  should  be  en- 
titled to  only  one-half  of  the  face  of  the  contract,  it  could  not  be 
contended  that  the  certificate  was  invalidated  bj'  suicide  on  the 
ground  of  public  policy. 

Morton  vs.   Supreme   Council.  Royal   League.   March,   1903,   100   Mo. 
App.  76. 

Common  Law  Presumed  to  be  Same  in  Each  State. 

In  an  action  on  a  certificate  made  in  Illinois  and  subject  to  its  laws, 
and  such  laws  relating  to  the  defense  urged  were  not  pleaded,  it 
was  held  that  the  defendant's  liability  must  be  determined  accord- 
ing to  the  common  law,  and  it  is  presumed  that  the  common  law 
of  another  State  is  the  same  as  in  Missouri. 

Morton  vs.    Supreme   Council.  Royal   League.   March,   1903,   100  Mo. 
App.  76. 

After-enacted  Laws,  When  Not  Binding. 

A  certificate  bound  the  member  to  comply  with  all  the  laws  and 
usages  of  the  society  then  in  force  or  which  might  thereafter  be 
adopted  by  the  society.  At  the  time  of  the  issuance  of  the  certificate 
one  of  the  by-laws  provided  that  if  any  member  committed  suicide 
within  two  years,  the  society  should  be  liable  onlj'  for  one-half  of  the 
face  of  the  certificate.  Thereafter  the  by-law  was  amended  so  as 
to  provide  that  if  a  member  should  suicide  at  any  time  his  bene- 
fieiai'v  should  receive  only  one-half  oi*the  certificate.  Held,  that 
the  i)rovisions  of  the  certificate  requiring  compliance  with  future 
regulations  related  only  to  such  regulations  as  affected  the  mem- 
ber's duties  as  a  member,  and  that  such  member  was  not  there- 
i'<irr  liMiind   li\'  Ihe  b\-liiw  as  ainriidcd. 


THE  HTATE  OF  MISSOURI  597 

Morton   vs.   Supreme  Council,   Rolay   League,   March,   1903,   100   Mo. 
App.  76. 

After-enacted  Laws,  to  What  Extent  Valid. 

Where,  by  the  terms  of  the  ;ipi)lieatii)n,  the  upplieaiit  agreed  to 
accept  the  certificate  of  membership  when  issued  subject  to  all  the 
laws  of  the  society  then  in  force  and  that  might  be  thereafter  en- 
acted, the  Court  held  that  the  proper  interpretation  of  the  contract 
and  Uie  true  intent  of  the  recital  in  the  application  were  to  render 
obligatory  upon  the  member  only  such  after  adopted  laws  which 
were  enacted  for  the  conduct  of  the  society,  the  duties  of  the  mem- 
bers, as  such,  and  not  such  as  seek  to  impair  and  a  fleet  the  exist- 
ing contracts  of  insurance. 

Campbell  vs.  American  Benefit  Club  Fraternity,  March,  1903,  100  Mo. 
App.  249. 

Interpretation,  Rules  as  to  Conflicting  in  Diff"erent  States. 

While  the  rights  of  parties  under  a  sister  State  are  usuall.y  meas- 
ured by  the  laws  of  such  State,  even  when  the  enforcement  of  the 
contract  may  be  sought  in  this  State,  yet  an  Appellate  Court  of  this 
State  cannot  adopt  and  yield  to  a  mere  interpretation  of  a  contract 
not  confined  in  its  performance  to  that  State  but  susceptilile  of  ex- 
ecution elsewhere  in  direct  conflict  with  the  laws  of  this  State. 

Campbell  vs.  American  Benefit  Club  Fraternity,  March,  1903,  100  Mo. 
App.  249. 

Initiation,  Essential  Condition  to  Liability. 

Until  one  has  been  initiated  into  a  local  lodge  of  a  fraternal  so- 
ciety, the  society  cannot  rightfully  issue  a  benefit  certificate  to  him. 
The  statutes  of  the  State  require  fraternal  societies  to  have  a  lodge 
system,  and  they  intend  that  no  person  shall  become  a  member  of 
such  a  society  until  be  has  been  initiated  into  one  of  its  lodges. 

Hiatt  vs.  The  Fraternal  Home.  Fteb.,  1903.  99  Mo.  App.  105. 


598  FRATERNAL    SOCIETY    LAW 

Laws,  Knowledge  of  Presumed.     Waivers  of  Local  Officers  Not  Fa- 
vored. 

Members  of  fraternal  societies  are  presumed  to  know  the  by-laws 
and  regulations  of  the  societies  in  regard  to  payment  of  dues  and 
assessments  and  to  conform  to  them,  and  local  secretaries  have  no 
power  to  waive  prompt  paj-meut  of  such  obligations  or  to' set  aside 
any  other  essential  features  of  the  contract  although  by  cour.se  of 
business  the  chief  officers  of  a  society  may  tolei'ate  waivers  made  by 
local  officials  and  may  bind  the  society  by  such  course  of  dealing  in 
violation  of  the  provisions  of  the  laws  of  the  society. 

Boyce  vs.  The  Royal  Circle.  March,  1903,  99  Mo.  App.  349. 

Fraternal  Society,  Definition  of  in  Missouri. 

The  question  whether  a  society  is  a  fraternal  beneficiary  society 
as  defined  in  the  statute  is  to  be  determined  alone  by  its  charter  and 
the  laws  under  which  it  operates ;  and  while  a  society  may  meet  the 
definition  required  of  it  in  another  State,  such  fact  can  give  it  no 
rights  pertaining  to  such  societies  in  this  State,  unless  it  meet  the 
description  required  by  the  J\Iissouri  statute. 

Baltzell  vs.  Modern  Woodmen  ol;  America,  Feb.,  1903,  98  Mo.  App.  153. 

Health  Certificates,  Waivers  of. 

The  deceased,  after  default  in  his  dues,  made  payment  of  such 
arrears  to  the  local  Scribe,  who  promised  to  send  him  a  blank  health 
sli]i  to  be  filled  out  and  to  be  returned  by  him  to  the  Local  Scribe, 
which  the  deceased  failed  to  do.  This  practice  appeared  in  other 
cases  without  objection  from  the  society,  and  it  was  held  to  be  a 
waiver  of  the  requirement  that  such  health  certificate  should  be  fur- 
nished at  the  time  of  pajing  arrearages. 

Cauveren  vs.  Ancient  Order  of  Pyramids,  Feb.,  1903,  98  Mo.  App.  433. 

Evidence,  Declarations  of  Member  Admissible. 

In  his  application  foi'  membership  the  insured  stated  he  had  never 


THE  STATE  OF  MISSOURI  599 

been  intoxicated  or  had  a  hemorrhage.  Held,  on  a  trial  wheif  the 
beneficiary  sought  to  collect  under  the  eertiiicate,  that  the  member's 
subsequent  declarations  to  the  contrary  were  admissible,  since  the 
deceased  was  the  opposite  party  to  the  contract,  and  the  ease  is  dis- 
tinguishable from  ordinary  life  insurance. 

Callies  vs.  Modern  Woodmen  of  America,  March,  1903,  98  Mo.  App.  521. 

Proofs  of  Death,  Furnishing  Blanks  Does  Not  Waive  Defenses. 

That  the  society  furnished  blank  proofs  of  loss  to  the  beneficiary, 
who  went  to  the  trouble  and  expense  of  making  them,  will  not  con- 
stitute in  itself  a  waiver  where  there  was  no  knowledge  that  there 
had  been  a  misrepresentation  as  to  the  warranties  in  the  appli- 
cation. 

Callies  vs.  Modern  Woodmen  of  America,  March,  1903,  98  Mo.  App.  521. 

Warranty,  Misrepresentation  as  to  Family  History. 

Where  an  applicant  is  required  to  give  full  answers  to  questions 
as  to  family  history,  complete  and  literally  true,  and  he  fails  to  state 
in  his  answer  relating  to  his  brotliers  that' one  was  dead,  the  answer 
is  not  fair  and  candid,  and  is  a  fraudulent  concealment  and  tanta- 
mount to  a  fraudulent  misrepresentation. 

Callies  vs.  Modern  Woodmen  of  America,  March,  1903,  98  Mo.  App.  521. 

Duel,  Definition  of. 

The  word  "duel"  in  a  benefit  certificate  has  its  ordinary  sig- 
nificance, and  is  a  combat  with  deadly  weapons  between  two  per- 
sons, with  some  pre-arrangement  and  understanding,  and  perhaps 
with  some  formality. 

Davis  vs.  Modern  Woodmen  of  America,  April,  1903,  98  Mo.  App.  713. 
Death  in  Violation  of  Law. 

For  the  facts  in  a  case  showing  death  in  violation  of  the  criminal 
law.    See, 


600  FRATERNAL    SOCIETY    LAW 

Davis  vs.   Modern  Woodmen   of  America,  April,   1903,   98   Mo.  App. 
713. 

Absence  for  Seven  Years,  Death  When  Presumed. 

The  presumption  of  death  arising  from  unexplained  absence  for 
seven  years  does  not  necessarily  imply  that  the  person  dies  at  the 
end  of  that  period.  Circumstances  may  show  the  probability  of  his 
death  at  an  earlier  date.  The  presumption  of  death  from  long  ab- 
sence is  not  an  imperative  rule  of  law  where  the  circumstances  of 
the  disappearance  permit  of  any  different  inference. 

Winters  vs.  Supreme  Lodge,  Knights  of  Pytliias,  Aug.,  1902,  96  Mo. 
App.  1. 

Proofs  of  Death,  Waived  by  Refusal  to  Furnish  and  Denial  of  Lia- 
bility. 

A  refusal  to  furnish  blanks  on  which  to  make  proofs  of  death  is 
held  a  waiver  of  such  proofs,  as  is  also  an  absolute  denial  of  lia- 
bility. 

Winters  vs.  Supreme  Lodge,  Knights  of  Pytliias,  Aug.,  1902,  96  Mo. 
App.  1. 

Beneficiary — Has  No  Vested  Interest. 

A  benefit  certificate  confers  no  vested  interest  in  the  beneficiary 
named,  nor  has  he  any  property  in  the  certificate,  since  he  is  subject 
to  be  displaced  by  the  member  naming  another  beneficiary  at  any 
time  during  the  life  of  the  member. 

Supreme  Council,  Royal  Arcanum  vs.  Kacer,  Aug.,  1902.  96  Mo.  App. 
93. 

Suspension — Rule  as  to  Notice  to  Member  of  Charges. 

A  b.v-law  provided  that  a  nou-paying  member  .should  be  suspended 
from  his  subordinate  lodge  by  the  acting  presiding  officer,  and  that 
any  subordinate  lodge  allowing  surh   delinquent  to  I'emain  unsus- 


THE  tiTATE  OF  MISSOURI  601 

pended  should  pay  liis  assessment  out  of  its  general  fund.  The 
subordinate  lodge  suspended  the  deceased  because  he  had  been 
carried  long  enough  b.y  it,  and  made  a  record  tliereof.  At  the  same 
time  the  Acting  President,  by  oral  declaration,  declared  him  sus- 
pended for  non-payment  of  two  certain  assessments.  Held,  that  the 
action  of  the  subordinate  body  did  not  suspend  the  member  because 
it  had  no  jjovver  to  do  so  for  the  cause  assigned,  and  that  the  action 
of  the  acting  presiding  officer  was  insufficient  to  effect  the  sus- 
pension for  the  reason  that  a  member  is  entitled  to  notice  and  a 
chance  to  defend  himself  when  charges  are  preferred  against  him. 

Seehorn  vs.  Supreme  Council,  Cath.  Knights  of  America.  June,  1902, 
95   Mo.  App.   233. 

Suspension — Course  of  Dealing  Affects. 

A  member  of  a  society  has  a  right  to  look  to  the  conduct  of  the 
business  in  the  collection  of  assessments,  particularly  so  as  that  con- 
duct affects  him,  and  if  such  conduct  induces  him  to  fall  into  the 
habit  of  delay  in  his  payments,  the  society  cannot  .suspend  him  with- 
out warning. 

Seehorn  vs.  Supreme  Council,  Cath.  Knights  of  America.  June,  1902. 
95  Mo.  App.   233. 

Conflict  between  Certificate  and  Laws. 

Where  the  certificate  conflicts  with  the  by-laws,  the  by-laws  should 
prevail  over  the  certificate. 

Howard  vs.  The  Bankers'  Union  of  the  AVorld,  May,  1902.  94  Mo.  App. 
442. 

Good  Health— Defined. 

In  a  certificate  the  term  "good  health"  means  freedom  from  con- 
stitutional or  hereditary  diseases,  or  other  maladies,  the  tendency 
of  which  is  to  permanently  impair  vitality  and  shorten  life. 

Howard  vs.  The  Bankers'  Union  of  the  World,  May,  1902,  94  Mo.  App. 
442. 


602  FRATERNAL    SOCIETY    LAW 

Agency — As  to  Local  Officials. 

Notwithstanding  the  by-laws  make  the  local  secretaries  agents 
of  members  paying  them,  the  real  character  of  such  secretaries  will 
be  determined  by  the  courts. 

Howard  vs.  The  Bankers'  Union  of  the  World,  May,  1902,  94  Mo.  App. 
442. 

Fraternal  Societies  Not  Restricted  to  Assessment  Business. 

The  in-ovisions  of  the  Revised  Statutes  of  1899  relating  to  frater- 
nal societies  make  it  apparent  that  the  legislature  intended  that 
such  societies  should  not  be  restricted  to  the  assessment  plan  for  the 
purpose  of  raising  funds  to  pay  death  losses,  but  that  they  might 
raise  funds  by  requiring  the  members  to  pay  periodical  dues,  to  be 
fixed  with  reference  to  the  age  of  the  member  and  the  amount  of  his 
certificate,  and  that  it  is  competent  for  the  society  to  raise  the  mor- 
tuary fund  by  dues  or  b.v  assessment,  or  by  both  methods. 

Morton  vs.  The  Royal  Tribe  of  Joseph,  March,  1902,  93  Mo.  App.  78. 

Fraternal  Societies — How  Differing  from  Old  Line. 

For  an  interesting  discussion  as  to  the  distinguishing  character- 
istics lietween  fraternal  insurance  and  old  line  insurance,  see, 

Morton  vs.  The  Royal   Tribe   of  Joseph,   March,   1902,   93   Mo.   App. 
78. 

Foreign  Society — Rules  as  to  When  Not  Authorized  to  do  Business  in 
State. 

A  society  organized  in  another  State  and  doing  business  in  this 
State  without  complying  with  the  laws  thereof  sub.jecting  its  officers 
to  the  pains  and  penalties  of  the  statute,  must  be  held  strictly  ac- 
countable and  must  pay  beneficiaries  of  members  full  amount  of 
certificates  issued  to  members,  though  the  latter  may  suicide,  not- 
withstanding there  may  be  provisions  in  the  certificate  to  the  con 


THE  STATE  OF  MISSOURI  603 

trary,   since  such   contracts  come   undor  the  i^'ovisiinis   of  Section 
780fi.  Revised  Statutes  of  1899. 

Brassfleld  vs.  Tlie  Knights  of  the  Maccabees,  Jan.,  1902,  92  Mo.  App 
102. 

Beneficiary- — Rules  as  to  Change. 

Where  the  rules  of  a  society  prescribe  foi-ms  for  eliauging  bene- 
ficiaries, such  forms  slionld  be  followed  to  the  exclusion  of  all  other 
methods,  and  an  attempt  to  change  the  beneficiary  by  some  other 
method  is  generally  not  sufficient  or  enforcible  either  at  law  or  in 
equity. 

Grand  Lodge  A.  0.  U.  W.  vs.  Ross,  June,  1901,  89  Mo.  App.  621. 

Expulsion  for  Misconduct  Justified. 

A  member  who  feigns  illness  and  thereb.v  fraudulently  obtains 
sick  benefits  from  his  subordinate  lodge,  subjects  himself  by  such 
conduct  to  expulsion,  in  accordance  with  correct  principles  of  law 
and  justice. 

Slater  vs.  Supreme  Lodge,  Knights  and  Ladies  of  Honor,  March,  1901, 
88  Mo.  App.  177. 

"Paralysis"  Definition  of. 

Paralysis,  in  medical  nomenclature,  is  usually  restricted  to  the 
loss  or  impairment  of  volitntary  muscular  power,  and  is  regarded 
rather  as  a  symptom  than  as  a  disease  per  se,  and  generally  is 
connected  with  a  marked  lesion  of  some  portion  of  the  nervous  sys- 
tem. 

Yarbrough  vs.  National  Benev.  Society,  April,  191)1.  8S  Mo.  App.  465. 

Beneficiary — Married  Adult  Son  Not  a  Dependent. 

A  son  who  has  come  to  maturity  and  left  the  father's  family 
permanently,   becomes   an    independent  entity   and    is   no   longer  a 


e04  FRATERNAL    SOCIETY    LAW 

member  of  the  father's  family,  and  the  father  cannot  be  the  bene- 
ficiary of  a  certificate  taken  by  his  son. 

Brower   vs.   Supreme   Lodge,   National  Reserve   Assn.,   March,   1901, 
87  Mo.  App.  ei4. 

"Heirs  at  Law" — Definition  of — Widow  is  Heir. 

Under  the  Missouri  statute,  the  word  "heirs,"  as  applied  to  per- 
sonalty, should  be  held  to  mean  those  who  are  entitled  to  it  under 
the  statute  of  distribution  in  ease  of  intestacy,  and  this  would  in- 
clude the  widow,  which  makes  her  an  heir  at  law  in  a  limited  sense 
and  entitles  her.  together  with  the  daughter  of  the  deceased  member, 
to  take  the  benefit  of  his  certificate  payable  to  the  member's  heirs 
at  law. 

Pleimann  vs.  Hartung,  April,  1900,  84  Mo.  App.  283. 

"Death  from  Opiates" — Accidents  not  Excepted. 

A  certificate  provided  for  a  deduction  in  case  of  death  caused 
by  the  use  of  opiates,  etc.  The  insured  died  from  an  overdose  of 
morphine  taken  to  allay  physical  pain.  Held,  that  this  did  not 
exempt  the  society  if  the  .jury  found  that  the  morphine  was  taken 
to  lessen  pain,  and  it  was  proper  to  so  instruct  the  juiy;  for  if  it 
was  taken  to  relieve  pain,  the  overdose  is  presumed  to  be  uninten- 
tional. 

Renn  vs.   Supreme  Lodge.  Knights  of  Pythias,  March,  1900,  83  Mo. 
App.   442. 

Forfeiture — Rights  of  Wronged  Member. 

Where  a  societ.y  abandons  its  contract  by  wrongfuU.v  refusing  rein- 
statement, and  declares  the  contract  forfeited,  the  member  can 
treat  the  contract  as  at  an  end  and  recover  back  his  pa.vments  with 
interest;  and  he  may  do  this  notwithstanding  the  fact  that  man- 
damus may  be  a  proper  remedj'  for  reinstatement  of  a  lapsed  mem- 
ber. 

Dickey  vs.  Covenant  Mut.   Life  Assn..   .Tan..   1900,  82   Mo.   App.  372. 


rilK  HTATE  OF  MISSOURI-  605 

Fraternal  Societies  Limited  in  Power  by  Statute. 

Benefit  societies  are  creations  of  the  statute,  iiicaj)able  of  exer- 
cising any  power  not  therein  expressed  or  clearly  implied,  and  an 
attempt  to  do  so  is  ultra  vires. 

Ferbrache  vs.  Grand  Lodge  A.  0.  U.  W.,  Oct.,  1899,  81  Mo.  App.  268. 

' '  Family ' ' — Definition  of. 

The  word  "family"  may  be  of  narrow  or  broad  meaning,  as  the 
intention  of  the  parties  using  it  or  as  the  intention  of  the  law  using 
it  may  be  made  to  appear,  and  where  a  son  and  his  wife  lived  with 
his  father,  being  dependent  upon  him  for  their  support  during  the 
son's  final  illness,  and  subsefinently  died  without  changing  the  re- 
lation between  himself  and  his  father,  the  father  and  son  belonged  to 
the  same  "family." 

Ferbrache  vs.  Grand  Lodge,  A.  O.  U.  W.,  Oct.,  1899,  81  Mo.  App.  268. 

Dependency — Statutory  Meaning. 

A  member  surrendered  his  certificate,  which  was  payable  to  his 
wife,  and  had  a  new  one  issued  payable  to  another  party,  who  is 
designated  as  being  dependent  upon  him.  For  the  facts  in  the  case, 
discussing  the  statutory  meaning  of  "dependency,"  see 

Grand  Lodge  A.  0.  U.  W.  vs.  Hanses,  Nov..  1899,  81  Mo.  App.  545. 

Beneficiary — Common  Law  Wife  May  Be. 

After  emigrating  to  America,  the  member  was  admitted  to  a 
fraternal  society  and  contracted  a  common-law  marriage  in  this 
country,  having  left  behind  him  a  lawful  wife  in  Europe,  who  pre- 
deceased him.  He  obtained  a  certificate  payable  to  the  common- 
law  wife,  and  it  was  held  that  she  was  competent  to  take  the  benefit 
and  entitled  to  it. 

Busch  vs.   Supreme  Tent,   Knights  of  the   Maccabees,  Nov.,   1899,  81 
Mo.   App.    562. 


606  FRATERNAL    SOCIETY    LAW 

Corporations  Chartered  in  Two  States — Rights  of. 

A  corporation  may  acquire  franchises  in  different  states  at  dif- 
ferent times,  and.  the  latter  one  will  not.  ipso  facto,  dissolve  the 
former,  and  both  corporations  may  do  biisiness  in  each  State  at  the 
same  time. 

Martinez  vs.   Supreme  Lodge,  Knights  of  Honor,  Nov.,  1S99,  81  Mo. 
App.  590. 

Beneficiary — No  Vested  Interest — Statute  in  Force  at  Maturity  of 
Contract  Determines  Rights  Under  Same. 

While  the  member  lived,  the  benefit  certificate  was  an  expectancy, 
and  no  vested  rights  could  accrue  under  it,  but  by  his  death  the 
benefit  secured  by  the  certificate  became  vested  in  the  person  desig- 
nated in  the  certificate,  if  within  the  class  ]iointed  out  by  the  stat- 
ute competent  to  receive  payment,  and  the  statue  in  force  at  the 
time  wlien  the  certificate  matured  is  to  govern. 

Supreme   Council,  Legion  of  Honor  vs.   NeicUet,   Nov.,   1899,   81  Mo. 
App.   598. 

Beneficiary — Right  of  Member  to  Designate  New  One. 

A  member  has  right  to  surrender  his  certificate  and  obtain  a  new 
one  designating  therein  a  new  beneficiary,  and  this  may  be  done 
as  often  and  when  the  member  cliooses,  provided  he  complies  with 
the  provisions  of  the  laws  of  the  society. 

Supreme  Lodge,  Knights  ami  Ladies  of  Honor  vs.   Schworm,  April, 
1899,  80  Mo.  App.  64. 

Death  from  Absence — When  Presumed. 

The  legal  presumption  of  death  permitted  at  common  law  upon 
the  lapse  of  seven  years  is  also  allowable  before  the  expiration  of 
that  period,  if  there  is  evidence  tending  to  prove  that  death  occurred 
at  an  earlier  date,  or  showing  a  greater  probability  of  death  than 
life  at  the  prior  date. 


THE  s'J'A'JH  or  .ly/NNOOA'/  007 

Carpenter   vs.    Supreme   Council,    J^cgion   of   Honor.    April.    1899,   79 
Mo.   App.    597. 

Courts  Should  Not  Interfere  With  Societies. 

Societifis  being  depondent  ii|)()ii  .•isscssiiiciils  should  Ix'  jx'rmittcd 
to  adopt  and  enforce  reasonable  rules,  mid  llir  courts  onsht  not  to 
interferes  witli  their  adiuinisti'a.tiou  execpl  i'or  the  most  iirc:ent 
reasons. 

State   vs.  Grand   Lodge   A.   O.   U.   W.,   Feb.,   1899.   78   Mo.   App.   546. 

Supreme  and  Subordinate  Lodge  Relations. 

For  a  discussion  of  the  relationship  existiiiu'  between  grand  and 
subordinate  lodges.    See, 

Puhr    vs.    Grand    Lodge,    German    Order    of    Harugari,    Nov..    1898, 
77  Mo.  App.  47. 

Expulsion,  Strict  Proceedings  as  to. 

A  member  has  a  property  interest  in  his  membership  in  a  society 
■when  it  carries  insurance  protection  tlierein,  and  the  laws  of  the 
society  and  the  procedure  with  reference  to  expulsion  must  be  fol- 
lowed before  his  membership  can  be  terminated. 

Slater  vs.  Supreme  Lodge,  Knights  and  Ladies  of  Honor,  November, 
1898,  76  Mo.  App.  387. 

Beneficiary — Rights  of  Creditor. 

For  the  facts  in  a  case  where  a  creditor  contested  with  the  bene- 
ficiary the  rights  of  the  latter  to  a  fund  due  nnder  a  certificate,  see 

Sternberg  vs.  Levy,  Nov.,  1898,  76  Mo.  App.  590. 

Beneficiary — No  Vested  Rights  until  Maturity  of  Contract. 

The  interest  of  a  beneficiary  is  a  mere  expectancy  before  the  deatli 
of  the  member,  after  which  event  it  becomes  vested. 

Grand   Lodge  A.   0.   U.  W.  vs.  Reneau.   :\Iay,   isns,   T.t   Mo,  App,  402 


608  FRATERNAL    SOCIETY    LAW 

Beneficiaries,  Change  of — When  Rules  May  be  Waived. 

Anterior  to  the  death  of  a  member,  the  society  far  whose  benefit 
the  rules  governing  changes  of  beneficiaries  are  made  may  waive 
compliance  with  any  such  rules  on  the  part  of  their  members  and 
thus  validate  attempts  made  to  change  beneficiaries  which  would 
be  inefliectual  under  strict  rules  of  the  order. 

Grand  Lodge  A.  0.  U.  W.  vs.  Reneau,  May,  1898,  75  Mo.  App.  402. 

After-enacted  Laws — When  Valid. 

A  certificate  was  issued  subject  to  the  existing  laws  of  the  society 
and  to  changes  to  be  made  thereafter.  Subsequent  by-laws  limited 
the  assessments  to  the  member.ship  in  the  division  where  the  de- 
ceased resided  and  changed  the  boundaries  of  such  division,  and 
thereafter  the  beneficiary  was  not  entitled  to  any  assessment  over 
the  membership  in  the  original  territory.  The  change  of  by-laws  in 
this  case  is  held  not  to  have  removed  the  provision  for  sepai-ate 
assessments  on  separate  jurisdictions. 

Brower   vs.    Supreme    Lodge,    National    Reserve    Assn.,    April,    1898, 
74  Mo.  App.  490. 

After-enacted  Laws — Valid  if  Provided  for. 

After-enacted  by-laws  which  are  within  contemplation  of  the 
minds  of  the  parties  at  the  time  of  the  making  of  the  contract, 
are  valid  and  may  reduce  the  amount  of  the  beneficiaries'  claim. 

Toomey  vs.   Supreme  Lodge,  K.  of  P.,  April,  1898,  74  Mo.  App.  507. 

"Family,"   Definition   of— Status   at  Maturity   of   Contract  Fixes 
Rights  of  Persons. 

A  certificate  was  taken  out  payable  to  the  mother  of  the  member 
with  whom  he  resided  at  the  time.  Subsequently  he  married  and 
established  a  home  of  his  own  separate  from  tlie  mother,  \\  Iki  was  not 
dependent  upon  him.  The  by-law.s  provided  for  benefits  to  be  jiaid 
to  the  members  of  the  family  of  the  member.    Held,  that  the  word 


THE  t^TATK  OF  MISSOURI  609 

"family"  did  not  iucludi:  the  iiiotlier,  and  that  she  Ix'came  incapac- 
itated to  receive  the  benefit;  that  the  status  of  the  lieneficiary  must 

be  siii'h  at  tile  time  of  the  death  oi'  a   ineiriher  as  to  hriiiu'  her  witldn 
the  purview  of  tiie  l>yda\vs  of  a  society. 

Lister  vs.  Lister,  Jan.,  1898,  7o  Mo.  App.  99. 

Suspension — Waiver  of  Rules  as  to  by  Member. 

A  member  liolding  a  certificate  may  waive  tlie  formalities  pre- 
scribed by  the  society  for  his  suspension  or  expulsion  as  against 
the  rights  of  his  beneficiary. 

Miller  vs.  U.  S.  Grand  Lodge.  Britli-Abraham,  Dec,  1897,  72  Mo.  App. 
499. 

Suicide — When  Duty  of  Court  to  Direct  Verdict. 

Ill  a  suit  on  a  certificate  where  the  defense  is  suicide,  under  a 
law  of  the  society  that  should  a  member,  sane  or  insane,  commit 
suicide  within  three  years  after  becoming  a  member,  his  claim  would 
be  null  and  void — held,  that  the  defense  was  an  affirmative  one  and 
conclusively  proven,  and  that  the  court  erred  in  not  directing  a  ver- 
dict for  the  society. 

Kornfeld  vs.  Supreme  Lodge.  Order  of  Mnitual  Protection.  December. 
1897.  72  Mo.  App.  604. 
39 


610  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  MONTANA. 

CHAPTER  27. 

The  State  of  Montana  has  not  enacted  any  laws  for  the  regnlation 
of  Fraternal  Societies  and  such  societies  are  therefore  free  from 
legislative  restrictions  so  far  as  Montana  is  concerned.  The  Supreme 
Court  of  that  State  has  been  called  upon  but  once  to  pass  upon 
questions  peculiar  to  Fraternal  Societies,  but  the  clearness  with 
which  the  court  in  that  case  exhibited  its  knowledge  of  fraternal 
law  is  most  gratifying. 

Beneficiaries — Changes  of. 

A  member  of  a  fraternal  society  has  the  right  to  change  his  bene- 
ficiary Avhenever  and  as  often  as  he  pleases.  ])rovided  he  eoni])lies 
with  the  laws  of  the  society  governing  such  matters. 

Knights  of  the  Maccabees  vs.  Sackett.  July.  1906,  34  Mont.  357. 

Beneficiaries — Waiver  of  Laws  Respecting  Changes  of. 

A  waiver  of  a  contract  pi'ovision  r('(|uiriiiu-  coiiqilinnce  with  the 
by-laws  of  a  fraternal  societ.v  governing  changiii.c  of  liencticiaries 
must  have  occurred  during  the  lifetime  of  the  member,  and  a 
former  beneficiary  cannot  take  advantage  of  the  non-full  com- 
pliance with  the  laws  by  the  member,  which  laws  have  been  waived 
by  the  societ.v. 

Kni.i^hts  of  tlic  Maccatiees  vs.  Sackett.  .Inly.  lilOt;.  34  Mont.  357. 


THE   HTATE   OF  MONTANA  611 

Beneficiaries — Lav/s  Must  be  Followed  in  Making  Changes. 

It  is  ;i  geiKTMl  I'Lilc  that  a  tncmbcr  must  ])i'()(X't'(l  in  aiu'or'dancu 
with  the  i-i'uu  hit  inns  contained  in  the  r-ertifieate  and  laws  and  a 
material  dexiatimi  IVmii  liie  ecnirse  liierein  jiidieate(l  will  in\'alidate 
tlic  Iransfer. 

Knights  of  the  Maccabees  vs.  Sackett,  Juiy,   1900,  34  Mont.  ?.51. 

Beneficiary — Change  of  Must  be  Complete  Before  Member's  Death. 

The  fact  that  a  written  request  for  tlie  chanji'e  of  beneficiary  in  a 
certificate  had  been  placed  in  the  mail  for  delivery,  and  was  actually 
received  within  six  hours  after  the  death  of  a  member,  where  the 
laws  re(|uired  .such  request  to  be  delivered  to  a  certain  official 
before  any  change  could  take  place,  could  not  affect  the  interests  of 
the  beneficiary  named  in  the  certificate  who  is  entitled  to  the  amount 
which  became  due  u])on  the  death  of  the  member,  and  the  doctrine 
that  e(|uity  will  do  what  ought  to  be  done  was  held  not  to  ap])ly  to 
such  case  so  as  to  require  the  society  to  recoo^nize  the  chang'e  in  the 
laws  attempted  to  be  made. 

Knights  of  tht  Maccabees  vs.  Sackett.  Jr.ly,  IflOfi.  .34  Mont.  3.")7. 

Interpleader — Rights  of  Beneficiary  not  Affected  By. 

By  paying  into  court  the  money  due  on  a  contract  the  society 
waived  failure  of  the  member  to  comjily  strictly  with  the  laws  of  the 
order  governing  the  change  of  beneficiary,  but  such  waiver  cimld 
not  im])air  the  rights  of  the  b(>neficiary  which  became  vested  ii])c)n 
the  death  of  the  member. 

Knights  of  the  Maccabees  vs.  Sackett.  July.  i;i(i<i.  34  Mont.  3.57. 


612  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  NEBRASKA. 

CHAPTER  28. 

(The  Section  numbers  employed  correspond  with  tliose  in  the 
Compiled  Statutes  for  1905'.) 

Fraternal  Beneficiary  Associations. 

Section  401:^.  A  fraternal  beneficiary  association  is  hereby  de- 
clared to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  such  society  shall  have  a 
lodge  system,  with  i-itunlistic  form  of  work  and  representative  form 
•of  government. 

Objects — Saving  Clause. 

Section  4(ll)J.  Such  societies  shall  make  provision  for  the  payment 
of  benefits  in  case  of  death,  and  may  make  provision  for  the  pay- 
ment of  benefits  in  case  of  sickness,  temporary  or  permanent  physi- 
cal disaliility,  either  as  a  result  of  disease,  accident  or  old  age; 
Provided,  The  period  in  life  at  which  payment  of  physical  disability 
benefits  on  account  of  age  commences  shall  not  be  under  seventy 
years.  Provided,  The  payment  of  such  benefits  in  all  eases  shall  be 
subject  to  eompiiance,  by  the  member,  with  the  contract,  constitu- 
tion, rules,  and  laws  of  the  society;  Provided,  fnrther.  That  this  act 
shall  not  be  construed  to  include  fraternal  orders  which  only  provide 
for  sick  and  funeral  benefits,  nor  any  fraternal  beneficiary  society. 
order  or  association  now  organized  under  the  laws  of  this  State  until 


THE    STATE    OF    NEBRASKA  tjl3 

January  1st.  1898;  iioi-  shall  the  contract  between  1lie  hnkler  oi'  any 
certificate,  or  the  beneticiai'ies  of  such  certificates  and  the  society, 
ordei',  or  association  issuing  the  same,  contained  in  certificate  issued 
by  any  such  society,  order  or  association  organized  under  the  laws  of 
this  State,  prior  to  January  1st.  18!)8,  he  in  any  way  affected  by  this 
act. 

Funds,  How  Created. 

Section  4014.  The  funds  from  wliich  the  pa.yment  of  such  benefits 
shall  be  made,  and  the  fund  from  which  the  expenses  of  such  society 
shall  be  defrayed,  shall  be  derived  from  beneficiai-y  calls,  assess- 
ments, oi-  dues  collected  from  its  members. 

Beneficiaries — Age  of  Members. 

Section  4(115.  No  fraternal  society  created  or  organized  under  the 
jii-ovisions  of  this  act  shall  issue  beneficiary  certificate  of  member- 
ship to  any  person  under  the  age  of  eighteen  years,  nor  over  the  age 
of  fifty-five  years.  Payment  of  death  benefits  shall  only  be  made  to 
the  families,  heirs,  blood  relations,  affianced  liusband  or  affianced 
wife  of,  or  to  persons  (b^peiideiit  upon  the  iiicmlier. 

Effect  of  Statutes. 

Section  4016.  Such  societies  shall  be  governed  by  this  act  and 
shall  be  exempt  from  the  provisions  of  the  statutes  of  this  State  re- 
lating to  life  insurance  companies  except  as  hereinafter  provided, 
and  no  law  hereafter  passed  shall  ajiiily  to  them  unless  they  be 
ex]iressly  designated  therein. 

Suits — Venue. 

Section  4017.  Such  society  may  lie  sued  in  any  county  in  which 
is  kept  their  principal  place  of  business  or  in  which  the  beneficiary 
contract  was  made  or  in  which  the  death  of  the  member  occurred, 
or  in  the  county  of  the  residence  of  such  deceased  member;  but 
actions  to  recover  old  age.  side  or  accident  benefits  nuiy,  at  the 
option  of  the  beneficiary,  be  brought  in  the  count.v  of  his  residence. 


614  FRATERNAL    SOCIETY    LAW 

Exemption  from  Execution,  Attachment,  Etc. 

Section  -K)18.  The  money  or  other  benefit,  charity,  relief  or  aid  to 
he  [)aid.  provided  or  renth^red  b\'  any  society  authorized  to  do  busi- 
ness under  this  act,  shall  not  be  liable  to  attachment  by  trustee, 
garnishee  or  other  process,  aud  shall  not  be  seized,  taken,  appropri- 
ated or  applied  hy  au\'  leual  or  equitable  process,  or  by  operation  of 
law.  to  pay  an.y  debt  or  liability  of  a  eei'tificate  holder  or  of  any 
beneficiary  named  in  a  certificate,  or  of  an.v  person  who  may  have 
any  right  thereunder. 

Existing  Societies. 

Section  4(119.  All  such  societies  org-anized  under  the  laws  of  this 
or  any  other  State,  territory  or  province,  and  now  doing'  business  in 
this  State,  may  continue  such  business  provided  they  hereafter  com- 
ply with  the  provisions  of  this  act. 

Foreign  Associations. 

Section  4020.  Any  such  society  organized  under  the  laws  of  any 
other  State,  and  not  now  doing  business  in  this  State,  shall  be  per- 
mitted to  do  business  within  this  State  when  it  shall  file  with  the 
auditor  of  public  accounts  a  duly  certified  coj)y  of  its  charter  and 
articles  of  association,  and  a  copy  of  its  eon.stitution  and  laws  certi- 
fied to  by  its  secretary  or  corresponding  officer,  together  with  an 
appointment  of  the  auditor  of  public  accounts  of  this  State  as  a  per- 
son upon  whom  process  may  be  served  as  hereinafter  providetl:  and 
Provided,  That  such  society  shall  be  shown  by  proper  certificate  to 
be  authorized  to  do  business  in  the  State,  territory  or  province  in 
wliicli  it  is  iiicori)orat.ed  or  organized.  The  auditor  of  public  ac- 
counts may  personally,  or  by  some  person  to  be  designated  h\  him, 
examine  into  the  condition,  affairs,  character  and  business  nu'thotls. 
accounts  and  books  and  investments  of  such  society  at  its  home 
office,  which  examiiuition  sliail  be  at  the  expense  of  such  society,  and 
shall  be  made  within  thirty  (la\s  aftei'  deiiiMiid  Iheretor.  and  the 
expense  of  sudi  examination  shall  be  limited  to  .-|;.">.l)(»  per  day  and 
the  necessary  expenses  of  travel  anil  hotel   bill.     If  the  auditor  of 


THE    STATE    OF    NEBRASKA  615 

puhlit'  iici'ounts.  ai'tcr  siicli  o.\;iiiiin;it  ion,  is  of  tlic  opinion  tli:i1  no 
pciMiiit  should  he  tirantcd  to  sncli  society  lie  may  refuse  to  iss\ie  the 
same. 

Reports  to  and  by  Auditor — Certificate. 

Section  4021.  Every  siicli  society  doiny  liusiiiess  in  this  State  sh;ill, 
on  or  before  tlie  first  day  of  March  of  each  year,  malte  and  tile  with 
the  auditoi-  of  ]iublic  accounts,  a  report  for  the  year  ending  on  the 
:ilst  da.\-  of  December  immediately  precetiing.  All  reports  shall  be 
upon  blank  forms  to  be  provided  by  said  auditor,  or  may  be  pi'inted 
in  paniphh't  form,  and  shall  be  verified  under  oath  by  tlie  autlioi'ized 
officers  of  such  society,  and  shall  l)e  published,  or  the  substance 
thereof,  in  the  annual  report  of  the  auditor  of  public  accounts  under 
the  separate  title,  "Fraternal  Beneficiary  Associations,"  and  shall 
contain  answers  to  the  followinji-  (pu'stions:  1.  Number  of  certifi- 
cates issued  durinu-  the  3'ear,  or  members  admitted.  2.  Amount  of 
indemnity  effected  thereby.  3.  Niunber  of  losses  or  benefit  liabilities 
incurred.  4.  Number  of  losses  or  benefit  liabilities  paid.  5.  The 
amount  received  from  each  assessment  for  the  year.  6.  Total  amoiuit 
paid  members,  beneficiaries,  legal  representatives  or  heii's.  7.  Num- 
ber and  kind  of  claims  for  which  assessments  have  been  made.  8. 
Niunbci'  and  kind  of  claims  compromised  or  resisted,  and  brief  state- 
ment of  reasons.  9.  Does  association  charge  annual  or  periodical 
(lues  oi-  admission  fees.  10.  How  much  on  each  one  thousand  dollars 
annually,  or  per  captia  [capita]  as  the  ease  may  be.  11.  Total 
anuuuit  received,  from  what  source,  and  the  tlisposition  thereof.  12. 
Total  amount  of  salaries,  fees,  per  diem,  mileage  and  expenses  paid 
to  officers,  showing  aiuount  paid  to  each.  13.  Does  the  society  guar- 
antee, in  its  certificates,  fixed  amounts  to  be  paid  regardless  of 
amount  realized  from  assessments,  dues,  admission  fees  and  dona- 
tions? 14.  If  so,  state  amount  guaranteed,  and  the  security  of  the 
guaranty.  15.  Has  the  association  a  reserve  or  emergency  fund? 
Ifl.  If  so,  how  is  it  created,  and  for  what  ]iuri>ose.  the  amount  thereof, 
and  how  invested.  17.  Has'the  association  more  than  one  class?  18. 
If  so,  how  many,  and  amount  of  indemnity  in  each.  19.  Number  of 
members  in  each  class.  20.  If  incorporated,  so  state,  ang  [and] 
give  tlate  of  organization.     21.  If  organized  under  the  laws  of  this 


6iy  FRATERNAL    SOCIETY    LAW 

State,  under  what  law,  and  at  what  time,  giving  chapter  and  year 
and  date  of  passage  of  act.  22.  If  organized  luider  the  laws  of  any 
other  State,  territory  or  province,  state  such  fact  and  the  date  of 
organization,  giving  chapter  and  .year  aiul  dnte  of  jiassage  of  act. 
23.  Number  of  certificates  of  beneficiary  membership  lapsed  during 
the  year.  24.  Number  in  force  at  beginning  and  end  of  year;  if 
more  than  one  class,  number  in  each  class.  25.  Names  and  addresses 
of  its  president,  secretary  and  treasurer  or  corresponding  officers. 
At  the  time  of  filing  said  annual  report  each  society  shall  pay  to 
said  auditor  a  fee  of  ten  dollars.  The  auditor  of  jjublic  accounts  is 
authorized  and  empowered  to  make  any  additional  inquiries  of  any 
such  society  relative  to  the  business  contemplated  by  this  act,  and 
such  officer  of  such  society  as  the  auditor  may  require,  shall  promptly 
reply  in  writing,  under  oath,  to  all  such  inquiries.  If,  iipon  exami- 
nation, the  auditor  is  satisfied  that  such  society  is  transacting  its 
business  according  to  law  and  in  no  sense  fraudulently,  he  shall  issue 
his  certificate  authorizing  it  to  transact  business  for  the  following 
year. 

Foreign  Societies — Service  of  Process — Auditor's  Duties. 

Section  4022.  Any  such  society  permitted  to  do  business  within 
this  State,  and  not  having  its  principal  office  within  this  State,  and 
not  organized  under  the  laws  of  this  State,  shall  appoint,  in  writing, 
the  auditor  of  public  accounts  of  this  State  to  be  attorney  in  fact, 
on  whom  all  process  in  any  action  or  proceeding  against  it  shall  be 
served,  and  in  such  writing  shall  agree  that  any  process  against  it 
which  is  served  on  said  attorney  in  fact  shall  be  of  the  same  validity 
as  if  served  upon  the  association,  and  that  the  authority  shall  con- 
tinue in  force  so  long  as  any  liabilit.y  remains  outstanding  in  this 
State.  Copies  of  such  certificate,  certified  to  b,v  the  auditor  of  pub- 
lic accounts,  shall  be  deemed  sufficient  evidence  thereof,  and  shall  be 
admitted  in  evidence  with  the  same  force  and  efi'ect  as  the  original. 
Service  uijou  such  attorney  shall  be  deemed  sufficient  service  ui)on 
such  association.  When  legal  process  -against  any  sncli  society  is 
served  upon  the  auditor  of  piiblic  accounts,  he  shall  imniediately 
notify  the  society  of  such  service  by  letter,  postage  prepaid,  directed 
and  mailed  to  its  secretary  or  corresponding  officer,  and  shall  within 


THE    STATr<:    OF    NEBRASKA  617 

two  days  after  such  service  forward  in  the  same  manner  a  copy  of 
the  process  served  on  him  as  such  officer.  The  auditor  of  public 
accounts  shall  keep  a  record  of  all  processes  served  upon  him,  which 
shall  show  the  day  anil  hour  when  such  service  was  made. 

Certificate  to  do  Business. 

Section  i0'2:i.  The  auditor  of  public  accounts  shall,  upon  the  appli- 
cation of  any  such  association,  issue  to  it  a  permit  in  writing,  author- 
iziiii;-  it  to  do  business  within  this  State,  for  which  certificate,  and  all 
proceedings  connected  therewith  such  societj'  shall  pay  to  said  audi- 
tor of  public  accounts  the  fee  of  twenty  dollars. 

Agents  Soliciting  Membership. 

Section  4024.  Such  society  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organization  or  build- 
ing up  of  subordinate  bodies  or  granting  members  inducements  to 
procure  new  members. 

Beneficiary — Change. 

Section  4025.  No  contract  between  a  member  and  his  beneficiary 
that  the  beueficiary  or  any  person  for  him  shall  pay  such  member's 
assessments  and  dues,  or  either  of  them,  shall  deprive  the  member 
of  the  right  to  change  the  name  of  the  beneficiary. 

Meetings  Outside  State. 

Section  4026.  Any  such  society  organized  under  the  laws  of  this 
State  may  provide  for  the  meeting  of  its  legislative  or  governing 
body  in  another  State,  territory  or  province  wherein  such  association 
shall  have  subordinate  bodies,  and  all  business  transacted  at  such 
meeting  shall  be  valid,  in  all  respects,  as  if  such  meetings  were  held 
within  this  State ;  and  where  the  laws  of  any  such  society  provide 
for  the  election  of  its  officers  by  votes  to  be  cast  in  its  subordinate 
bodies  the  votes  so  cast  in  its  subordinate  bodies  in  any  other  State, 
territory  or  province  shall  l)e  valid,  as  if  cast  within  this  State. 


618  FRATERNAL    SOCIETY    LAW 

Failvtre  to  Make  Report — Maladministration. 

Section  4027.  Any  such  association  refusing  or  neglecting  to  make 
the  report  as  provided  in  tliis  act  shall  be  excluded  from  doing  busi- 
ness within  this  State.  The  auditor  of  public  accounts  must,  within 
sixty  days  after  the  failure  to  make  such  report,  or  in  case  anj'  such 
society  shall  exceed  its  powers,  or  shall  conduct  its  business  fraudu- 
lently, or  shall  fail  to  comply  with  any  of  the  provisions  of  this  act, 
give  notice  in  writing  to  the  attorney  general,  who  shall  immediately 
commence  an  action  against  such  society  to  enjoin  the  same  from 
carrying  on  any  business.  No  society  so  enjoined  shall  have  author- 
ity to  continue  in  business  until  such  report  shall  be  made,  or  overt 
act  or  violation  complained  of  shall  have  been  corrected,  nor  \intil 
the  costs  of  such  action  be  paid  by  it;  Provided,  That  the  court  shall 
find  that  such  society  was  in  default,  as  charged,  whereupon  the 
auditor  of  jjublic  accounts  shall  reinstate  such  a.ssociation.  and  not 
imtil  then  shall  such  association  be  allowed  to  again  do  business  in 
this  State.  Any  officer,  agent,  or  person  acting  for  any  such  asso- 
ciation or  subordinate  body  thereof  within  this  State,  while  such 
association  shall  be  so  enjoined  or  prohibited  from  doing  l)usiness 
|)ursuant  to  this  act,  shall  be  deemed  guilty  of  a  misdemeanor,  and, 
on  conviction  thereof,  shall  be  punished  by  a  fine  of  not  less  than 
twenty-five  dollars,  nor  more  than  two  hundred  dollars,  or  by  im- 
prisonment in  the  county  jail  not  less  than  thirty  days  nor  more 
than  one  year,  or  both  fine  and  imprisonment,  in  the  discretion  of 
the  court. 

Same — Business  Ceases. 

Section  4028.  Any  person  who  shall  act  within  this  State  as  offi- 
cer, agent  or  otherwise,  for  any  such  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  whicli  shall  have 
violated  any  of  the  provisions  of  this  act,  or  shall  have  failed  or  neg- 
lected to  procure  from  the  auditor  of  public  accounts,  pi'0[)er  certifi- 
cate of  authority  to  transact  business  as  provided  by  this  act.  shall  he 
subject  1o  llii'  penalty  [irovided  in  the  nexl  jirecediiig  seelion  fur  the 
niisdeuu'anor  tliei'cin  s|;(_M'iliiMl. 


THE    XTATK    OF    NhJBRAtiKA  (519 

Fraudulent  Conduct. 

Section  4029.  Any  officer,  agent,  or  member  of  such  society,  who 
shall  obtain  any  money  or  property  belonging-  thereto,  by  any  false 
or  fraudulent  representation,  shall  be  fined  not  more  than  five  hun- 
dred dollars  and  costs,  and  stand  committed  until  such  fine  and 
costs  are  paid,  or  may  be  imjirisoned  in  the  county  jail  not  more 
than  six  months. 

Medical  Examination. 

Section  4030.  Every  ajiplicant  for  lienefieial  memliership  in  uny 
siu'li  society  doing  business  in  this  State,  shall  first  be  examined  by 
;i  ])hysician  duly  authorized  to  practice  medicine  within  this  State. 

Societies  —  Organization  —  Requirements  —  Incorporation  —  Cer- 
tificate. 

Section  4031.  Any  ten  or  more  persons,  residents  of  this  State, 
and  over  twenty-one  years  of  age,  may  associate  themselves  together 
for  the  purpose  of  forming  a  corporation  luider  this  act,  for  which 
purpose  they  shall  make,  sign  and  acknowledge,  before  any  officer 
authorized  to  take  acknowledgments  of  deeds  in  this  State,  a  certifi- 
eate  of  association,  in  which  shall  l>e  stated  the  name  or  title  of  the 
proposed  society;  the  object  for  which  it  was  formed;  the  plan  of 
doing  business,  clearly  and  fully  defined;  the  names  of  the  board  of 
officers  or  managers  for  the  first  year,  and  the  manner  of  selecting 
their  successors;  the  limits  as  to  ages  of  apjilicants  for  membership, 
ami  1liat  medical  examinations  are  required,  and  that  b.ona  fide  ap- 
plications for  membership  have  been  secured  from  not  less  than  two 
hundred  and  fifty  persons,  who  have  each  made  ai)plicati(ui  for 
membership  in  such  proposed  society,  and  have  been  duly  examined 
and  recommendeil  by  a  I'cputalile  physician,  and  have  each  deposited 
with  the  parties  asking  such  charter  the  sum  of  one  advance  assess- 
ment on  each  one  thousand  dollars  of  insurance  or  part  thereof,  pro- 
vided for  in  the  [ilan  of  organization  of  such  society,  as  an  advance 
assessnuMit  for  moi'tnary  purposes,  together  with  the  certificate  of 
sdiiic  solvent  bank   or   banks  thai    all    of  such   moi'fuarx-   funds   are 


620  FRATERNAL    SOCIETY    LAW 

dei^osited  tliereiu  to  be  turned  over  to  tlie  treasurer  of  a  subordinate 
lodge  or  branch  composed  of  snch  applicants,  after  the  incorporation 
of  such  society,  which  certificate  of  association  shall  be  filed  with 
the  ai^ditor  of  pul)lic  accounts,  accompanied  bj'  a  fee  of  twenty 
dollars :  Provided  that  such  new  organization  shall  not  be  permitted 
to  issue  a  certificate  to  exceed  the  sum  of  one  thousand  dollars  until 
it  shall  have  at  least  two  thousand  beneficial  members.  If  the  audi- 
tor of  public  accounts  shall  find,  after  careful  examination,  that  the 
objects  of  organization  and  plan  of  doing  business  are  fuU.v  and 
definitely  set  forth,  and  are  clearly  within  the  provisions  of  this 
act.  and  that  the  name  or  title  is  not  the  same,  or  does  not  so  nearly 
resemble  a  title  in  use  as  to  have  a  tendency  to  mislead  the  public, 
he  shall  approve  the  same,  and  forthwith  issue  a  certificate  of 
organization  to  such  society.  Thereupon  such  society  ma.v  proceed 
to  transact  business  according  to  the  ])lan  of  its  organization. 

Exempt  from  General  Law — Deposit  of  Securities — Care  of  Funds. 

Section  4032.  All  societies,  orders  and  associations  contemplated 
in  this  act,  shall  be  exempt  from  the  provisions  of  chapter  16  of  the 
Compiled  Statutes  of  1885,  but  any  such  society  or  association  may 
deposit  any  of  its  notes,  bonds  or  securities  held  b.v  it,  specifying 
at  the  time  of  such  deposit,  to  what  funds  such  bonds,  notes  or 
other  securities  belonging,  with  the  State  auditor,  who  shall  accept 
the  same  and  receipt  therefor  the  same  as  in  the  case  of  deposits 
made  by  Mutual  Benefit  Associations  and  Life  Insurance-  Companies, 
and  such  deposits  shall  be  sub.ject  to  the  same  provisions  of  law 
as  deposits  made  by  such  Mutual  Benefit  Associations  and  Life  In- 
surance Companies,  and  the  State  auditor  and  his  bondsmen  shall  lie 
liable  on  his  official  bond  for  the  safe  keeping  and  management  of 
such  securities  in  like  manner  as  for  deposits  madt'  by  ^lutual 
Benefit  Associations  and  Life  Insurance  Companies.  Provided.  Thnt 
sucii  secret  societies  and  associations  shall  comply  with  all  the  other 
provisions  of  this  act.  The  moneys  collected  by  anv  such  society 
fnuii  it  members,  accordinu'  to  the  plan  or  method  provid("'d  in  its 
const  it  n1  ion  and  by-l,-i\vs  for  the  |)a>nieiit  of  dealli  oi-  disability 
claims  arisiiiu'  luider   the   terms  of   its   lieiicficiary   certificates  shall 


THE    STATE    OF   NEBRASKA  621 

111'  kepi  sciiarali'  :iiii|  apiirt  i'roiii  Ihc  other  riiiids  (if  such  society, 
iuid  shall  lie  used  only  in  iiaymcut  nl'  such  claims,  and  no  part, 
tiici'cot'  sliall  be  used  by  such  s<iciety  in  payiiiciit  of  exjicnses  ol'  any 
kind  or  cliaracler. 

Constitution — By-laws  Filed. 

Section  4033.  Every  such  society  shall  file  with  the  auditor  of 
])nblic  accounts  a  copy  of  its  constitution  and  by-laws,  duly  certi- 
fied to  by  the  secretary  or  corresponding-  officer,  and  before  any 
amendment,  change,  or  alteration  thereof  shall  take  effect  or  be  in 
force  a  copy  of  such  amendment,  change,  or  alteration,  duly  certified 
to  by  its  secretary  or  corresponding  officer,  shall  be  filed  with  the 
auditor  of  public  accounts. 

Reinsurance. 

Section  -1034.  It  shall  be  lawful  for  any  frafernal  beneficiary  so- 
ciety or  association  organized  inider  the  laws  of  this  State,  and 
authorized  to  transact  business  in  this  State,  which  shall  have  and 
maintain  fraternal  relations  with  a  like  society  of  a  similar  name 
organized  under  the  laws  of  another  State,  and  which  such  othei'. 
society  shall  claim  to  be  superior  to  such  society  organized  under 
the  laws  of  this  State,  to  contract  to  and  with  such  society  organized 
under  the  laws  of  such  other  State  according  to  its  constitution  and 
laws,  to  guaranty  the  payment  of  death  benefits  of  such  society  or- 
ganized under  the  laws  of  this  State,  either  in  whole  or  in  part,  and 
in  consideration  of  such  guaranty  to  pay  to  such  society  organ- 
ized undei-  the  laws  of  such  other  Stat"  such,  sum  or  sums  at  such 
time  or  times  as  may  be  mvitually  agreed  upon,  and  for  the  purpose 
of  providing  funds  wherewith  to  make  such  jiayments  such  society 
organized  under  the  laws  of  this  State  may  collect  from  its  members 
such  a.ssessments  or  dues  as  may  be  provided  by  its  constitution  or 
by-laws.  Provided,  That  such  society  organized  under  the  laws  of 
such  other  State  shall,  on  or  before  the  31st  day  of  March  of  each 
year,  make,  execute  and  deliver  to  the  auditor  of  public  accounts  of 
this  State  a  jiower  of  attorney  de.signating  such  auditor  of  public 
accounts  and  his  successors  in  office,  as  a  person  ujion  whom  service 


622  FRATERNAL     HOVIETY    LAW 

of  process  may  be  had  in  any  case  arising'  out  of  such  contract  lic- 
tween  such  societies. 

Consolidation — Reinsurance. 

Section  4(l34a.  When  any  fraternal  beneficiary  association  sliall 
propose  to  consolidate  or  enter  into  any  reinsurance  contract  with 
any  other  association  or  organization,  it  shall  present  its  proposed 
I)lau  of  consolidation  or  reinsurance,  together  with  a  statement  of 
the  condition  of  its  affairs  to  the  Auditor  of  State  f(n-  his  approval. 
Should  he  approve  of  the  plan,  the  same  shall  be  submitted  by  any 
.association  proposing  to  reinsure  its  risk  or  transfer  its  business, 
to  its  local  lodges  or  organizations  or  to  a  regular  or  special  meeting 
of  its  supreme  lodge  or  governing  body  to  be  voted  upon,  such  notice 
being  given  as  the  Auditor  of  State  may  direct.  If,  in  the  .iudgnient 
of  the  Auditor  of  State  it  is  deemed  advisable  he  may  require  the 
plan  to  be  in  like  nuiiiner  subniitt('(l  to  the  association  proposing  to 
accept  or  reinsure  the  risks  of  any  other  association.  In  case  two  or 
more  associations  propose  to  consolidate,  the  proposed  plan  of  con- 
solidation shall  be  submitted,  as  above  provided,  to  all  of  the  associa- 
tions interested  in  such  considilations.  In  any  of  the  above  cases,  a 
two-thirds  vote  of  all  the  members  of  each  association  present  and 
voting  shall  be  necessary  to  an  approval  of  any  plan  of  consolidation 
or  reinsurance,  and  in  no  case  shall  proxies  be  voted.  On  presenting 
to  the  Auditor  of  State  satisfactory  proof  that  tlie  foregoing  |iro- 
visions  have  been  eoinplied  with  and  that  the  recpiired  niunlu'r  of 
votes  have  been  cast  in  fjivor  of  the  ])roposed  plan,  he  shall  issue  to 
the  association  an  order  to  the  effect  that  the  plan  has  been  ap- 
proved, and  the  same  shall  he  in  force  aiul  effect  from  and  after  the 
date  of  such  order,  and  ''  ''  direct  such  dis- 

tril)ution  of  the  assets  of  any  such  association  or  associations  as  shall 
lie  just  and  equitable. 

Same — Expenses . 

Section  4()34lj.  Ail  expenses  or  costs  incident  to  proceedings 
luider  the  provisions  of  tliis  act  shall  be  paid  by  the  ;issociatioiis 
iidei'csted. 


THE    UTATE    OF    NEBRJiSKA  023 

Violation  of  Act. 

S('('tii)il  40;^4c.  Any  ofliciT,  (lircclcir  or  iii;in;it;ri'  (if  Miiy  Ji.ssoc'ia- 
tioii  violating  or  consentiiit;'  to  \\\f  \ioln1ion  ol'  any  ol'  I  he  provision 
of  tills  act  shall  be  puuishetl  1).\  a  linr  of  not  h'ss  Ihan  one  lliousaiid 
dollars,  or  by  imprisonment  in  tlu'  county  jail  not  less  than  one  year 
or  by  both  such  fine  and  imprisonment  in  the  discretion  of  the  court. 

The  following  provisions  of  the  Statutes  of  Nebi-aska  are  also 
deemed  to  be  proper  for  incorporation  here : 

Actions  Against  Corporations. 

Section  6625.  An  action  other  than  one  of  those  nientionetl  in  the 
first  three  section  of  this  title,  against  a  corporation  created  by  the 
laws  of  this  State,  may  be  brought  in  the  county  in  which  it  is 
situated,  or  has  its  principal  office  or  place  of  business;  but  if  such 
corporation  be  an  insurance  company,  the  action  nuiy  be  brought  in 
the  county  where  the  cause  of  action,  or  some  part  thereof,  arose,  or 
in  the  county  where  any  contract  or  portion  of  a  contract  entered 
into  by  such  insurance  company  has  been  violated,  or  is  to  be  per- 
formed. 

Non-residents. 

Section  6629.  An  action  other  than  one  of  tliose  mentioned  in 
the  first  three  sections  of  this  title,  against  a  non-resident  of  this 
State  or  a  foreign  corporation,  may  be  brought  in  any  county  in 
which  there  may  be  property  of,  or  debts  owing  to,  said  defendant, 
01-  where  said  defendant  may  be  found:  but  if  said  defendant  be  a 
foreign  insurance  compan\-,  the  action  may  be  brought  in  any  county 
where  the  cause,  or  some  part  thereof,  arose. 

Same— Insurance  Companies. 

Section  6646.  Wlien  the  defendant  is  an  incorporated  insurance 
company,  and  the  action  is  brought  in  a  county,  in  which  there 
is  an  agency  thereof,  the  service  may  be  u])on  the  chief  officer  of 
such  agency. 


624  FRATERNAL    SOCIETY    LAW 

Frauds  on  Life  Insurance  Companies. 

Section  7803.  If  any  person  or  persons  shall  obtain,  cause  to  be 
obtained,  or  attempt  to  obtain  from  any  life  or  accident  insurance 
company  any  sum  of  money,  on  any  policy  of  life  or  accident  insur- 
ance issued  by  any  company  in  this  State,  by  falsely  or  fraudulently 
representing  the  person  or  persons  insured  as  dead,  or  shall  cause 
any  person  or  persons  to  be  insured  under  an  assumed  name,  and 
shall  falsely  represent  the  fictitious  person  or  persons  so  insured 
as  dead,  and  shall  thereby  obtain,  cause  to  be  obtained,  or  attempt 
to  obtain  from  such  company  tlie  amonnt  of  such  insurance  and 
shall  falsely  obtain,  cause  to  be  obtained,  or  attempt  to  obtain  from 
any  .such  life  or  accident  insurance  company  any  sum  of  mcmey 
upon  any  life  or  accident  policy  of  such  company  by  means  of 
false  and  fraudulent  written  representation  or  affidavits,  falsely 
representing  that  the  person  whose  life  was  insured  was  dead,  or 
that  the  person  insured  against  accident  was  injured,  every  person 
so  offending,  if  the  sum  so  obtained,  attempted  or  caused  to  be  ob- 
tained shall  be  equal  to  or  exceed  the  sum  of  thirty-five  dollars, 
shall  be  punished  by  ihiprisonment  in  the  penitentiary  not  exceeding 
fifteen  years;  and  if  the  sum  so  obtained,  attempted  or  caused  to  be 
obtained  shall  be  less  than  thirty -five  dollars,  shall  be  fined  in  any 
sum  not  more  than  five  hundred  dollars,  or  be  imprisoned  in  the 
jail  of  the  proper  county  not  exceeding  six  months,  or  both,  at  the 
discretion  of  the  court. 

MUTUAL  BENEFIT  ASSOCIATIONS.  LIFE  INSURANCE  AND 
LIFE   INSURANCE   COMPANIES. 

Mutual  Assessment,  Etc.,  Companies. 

Section  3989.  Every  corporation  or  association  organized  under 
the  laws  of  this  State  upon  the  mutual  assessment,  stipulated  pre- 
mium, co-operative  or  natural  premium  plan,  for  the  purpose  of  in- 
suring the  lives  of  individuals,  or  of  furnishing  benefits  to  the 
widows,  heirs,  orphans,  or  legatees,  of  deceased  members,  or  of  pay- 
ing accident  indemnity,  shall,  before  commencing  business,  comjily 
with  the  provision.s  of  this  act. 


THE    STATE    OF    SEBRAHKA  625 

Articles  of  Incorporation. 

Section  ;^!)!)().  Tin-  articles  nl'  iiicurporal  inn  of  siii'li  (irv.aiiizalioiis 
shall  show  tlie  plan  i)l'  business,  and  shall  lie  snlniiilliMl  lo  the  auilitor 
of  state,  and  attorney  general,  and  if  such  articles  iire  founti  to 
comply  with  the  provisions  of  this  act  they  shall  approve  the  same. 
When  said  articles  are  thus  approved,  they  shall  be  recorded  in  the 
ot'liei'  of  the  recorder  (.)f  deeds,  in  the  county  where  such  organiza- 
tidii  is  located  and  of  the  secretary  of  state  antl  a  notice  iiublished 
as  |)i'o\ided  for  under  the  general  incorporation  law  of  the  State 
ol'  Nebraska.  Nothing  in  this  section  shall  be  construed  to  re(|uire 
the  incorporation  of  such  companies  already  duly  iiic<irporatec|  and 
o|)(>rating  under  tlie  laws  of  Xebraska. 

Name. 

Section  3;)!)1.  No  corporation  or  association  organized  under  this 
act,  shall  take  any  luiiue  in  use  by  any  other  organization  or  so 
closely  resemlding  such  name  as  to  mislead  the  public  as  to  its 
identity. 

Applications  for  Insurance — Certificate  for  Incorporation. 

Section  3992.  Each  association  organized  under  this  act,  shall, 
before  issuing  any  policy  or  certificate  of  membership,  if  said  asso- 
ciation has  not  membership  .sufficient  to  pay  the  full  amount  of  the 
certificate  or  policy  on  an  assessment  it  shall  cause  the  application 
foi-  insurance  to  have  printed  in  red  ink  in  a  conspicuous  manner 
along  the  margin  of  said  application  the  words  "It  is  understood 
and  agreed  that  the  amount  to  be  paid,  when  the  certificate  or  policy 
issued  upon  this  apjilication  becomes  a  claim,  shall  be  dependent 
ii]ion  the  amount  collected  from  an  assessment  made  to  meet  such 
claim,"  and  the.v  must  have  actual  applications  upon  at  least  two 
hundred  and  fifty  individual  lives  for  at  least  one  thousand  dollars 
each,  and  shall  file,  with  the  auditor  of  state,  satisfactory  proof  that 
the  ])resident,  secretary,  and  treasm-er,  of  said  corporation  or  asso- 
ciation have  each  given  a  good  and  sufficient  bond,  for  the  faithful 
discharge  of  their  duties  as  such  officers:  sworn  copies  of  which 
40 


626  '  FRATERNAL    SOCIETY    LAW 

bonds  shall  be  tiled  with  the  auditor  of  state,  also  a  list  of  said 
applications  giving  the  name,  age,  and  residence  of  each  ajiplicant 
and  the  amount  of  insurance  applied  for  1)y  each,  togethei'  with  the 
annual  dues  and  the  proposed  assessments  thereon,  which  statement 
shall  be  verified  under  oath  by  the  president  and  secretary  of  the 
association. 

Agents — Auditor 's  Certificate. 

Section  3993.  No  person  shall  act  within  this  State  as  agent  or 
otherwise  in  receiving  or  procuring  applications  for  insurance  for 
any  assessment  association  (except  for  the  purpose  of  taking  appli- 
cations for  organization),  luiless  the  corporation  or  association  for 
which  he  is  acting,  has  received  a  certificate  from  the  auditor  of  state 
as  provided  in  this  act,  authorizing  said  corporation  or  association  to 
transact  business  in  this  State,  nor  as  general  or  traveling  agent 
or  traveling  solicitor,  until  he  shall  have  received  from  said  auditor 
a  certiiicate  in  substance  the  same  as  that  provided  for  in  section 
14  of  this  act,  and  certifying  that  said  corporation  or  association 
has  complied  with  the  provisions  of  this  act,  and  that  said  general 
traveling  agent  or  traveling  solicitor  is  authorized  to  act  as  such. 

Objects  of  Assessments. 

Section  3994.  The  by4aws  of  any  such  corporation  or  association 
and  its  notices  of  assessment,  shall  state  the  ob.ject  or  objects  for 
which  the  money  to  be  collected  is  intended,  and  no  part  of  the  pro- 
ceeds of  such  assessment  shall  be  ap|)!icd  to  any  other  purpose  than 
is  stated  in  said  notices  and  by-laws,  and  the  excess  beyond  payment 
of  the  benefit  jirovided  for  in  such  assessm(>nt  shall  be  set  aside  and 
apjiiird  only  to  such  ]inr])os('s  as  said  by-laws  and  notices  specify. 

Members — Beneficiaries. 

Section  3995.  No  corporation  or  association  organized  or  ojiera- 
ting  under  this  act  shall  issue  any  certificate  of  mend)ershii)  or  policy 
to  any  person  uruler  the  age  of  fifteen  years,  nor  over  the  age  of 
sixtv-five    vears.    nor    unless   the    liciicliciary    uiidi'i'   said    certificate 


THE    HTATE    OF    /\7v7J/iM,S'A'/l  627 

shall  lir  till'  liiishaiiil,  wii'r,  rcl.-il  i\i',  li'Lial  i-r|irrsi'ii(  al  i\c,  heir  oi" 
legatee  of  sucli  insured  iihmiiIiim-,  iku-  shall  any  such  certificate  be 
assianed,  and  any  certilii'ale  issued  nr  assiyument  made  in  violation 
oi'  til  is  section  shall  be  void.  Any  member  of  any  corporation,  asso- 
ciatiim  or  society  operating'  under  liiis  act,  shall  have  the  right  at 
any  time,  with  the  consent  of  such  corporation,  association  or  so- 
ciety, to  make  a  change  in  his  beneficiary  without  requiring  the 
consent  of  such  beneficiary. 

Statements — Examinations. 

Section  3996.  The  business  year  of  each  Nebraska  corporation  or 
association  organized  or  operating  under  this  act,  shall  close  on  the 
thirty-first  d,ay  of  December  each  year,  and  such  corporation  or  as- 
sociation shall,  within  sixty  days  thereafter,  prepare  under  oath  of 
its  president  and  secretary,  and  file  in  the  office  of  the  auditor  of 
state  a  detailed  satement  of  its  a.ssets,  liabilities,  receipts,  from  each 
assessment,  and  all  other  sources,  expenditures,  salaries  of  officers, 
iiuiiilicr  (if  contributing  members,  death  losses  ]>aid  and  amount 
paid  (Ui  each  death  loss,  death  losses  reported  but  not  paid,  and 
answer  such  other  interrogatories  as  the  auditor  (who  shall  furnish 
blanks  for  that  purpose)  may  require,  in  order  to  ascertain  its  true 
financial  emidition,  and  shall  pay  upmi  filing  each  annual  statement, 
the  sum  of  ten  dollars.  The  auditor  shall  publish  said  annual  state- 
ment in  detail  in  his  annual  rejiort,  and  for  the  purpose  of  verifying 
such  statement  the  auditor  may  make  or  cause  to  be  made,  an 
examination  of  the  affairs  of  any  Nebraska  association  doing  busi- 
ness under  this  act  at  the  expense  of  the  association,  which  expense 
shall  not  exceed  the  necessary  hotel  and  traveling  expenses  of  the 
auditor  or  clerk.  If  the  auditor  appoints  some  person  iu>t  employed 
in  his  office  to  make  the  examination,  he  .shall  in  addition  to  actual 
expenses  be  allowed  not  to  exceed  five  dollars  per  day  for  the  time 
actually  employed.  If  the  said  auditor  shall  deem  it  necessary  for 
the  security  of  the  funds  of  the  assoeiati(ui.  he  may  re(iuire  the 
official  bonds  of  the  officers  to  be  increased  to  an  amount  not  to 
exceed  double  the  sum  for  which  they  are  accountable,  and  he  may 
require  supplemental  reports  fr(un  any  such  association  at  such  time 
and  in  such  f(U'm  as  he  nnn-  direct. 


628  FRATERNAL   SOCIETY    LAW 

Investment  of  Funds. 

Section  89!J7.  Any  Nebraska  corporation  or  association  accumu- 
lating any  moneys  to  be  held  in  trust  for  the  purpose  of  the  fulfill- 
ment of  its  policy  or  certificate,  contracts,  or  otherwise,  shall  invest 
such  accumulations  in  bonds  or  treasury  notes  or  warrants  of  the 
United  States,  or  this  or  other  states,  or  in  interest  bearing  bonds 
of  any  municipal  corjioration  in  Nebraska,  or  in  notes  secured  by 
mortgage  on  unencumbered  real  estate  in  the  State  of  Nebraska, 
or  Nebraska  district  irrigation  bonds,  not  to  exceed  fortj"  per  cent 
of  the  appraised  value  thereof  exclusive  of  improvements  and  shall 
deposit  such  securities  with  the  auditor  of  state,  who  shall  furnish 
such  corporation  or  association  with  a  certificate,  umier  his  seal  of 
office,  of  such  deposit,  showing  the  purpose  of  such  deposit  aud  to 
what  fund  the  same  is  to  be  applied  when  paid  out  and  also  showing 
the  aggregate  liabilities  of  such  corporation  or  association  at  the 
date  of  issuance  of  such  certificate;  Provided,  however,  That  such 
corporation  or  association  may  invest  in  real  estate  in  Nebraska  such 
a  portion  of  said  accumulation  as  is  necessary  for  its  accommodation 
in  the  transaction  of  its  business  and  to  lie  owned  by  said  corpora- 
tion or  association,  and  in  the  erection  of  any  huihling  for  such  pur- 
pose may  add  thereto  rooms  for  rental. 

Same — Change. 

Section  3998.  Such  association  may  have  the  right  at  any  time 
to  change  its  securities  on  deposit  by  substituting  fiu-  those  with- 
drawn a  like  amount  in  other  securities  of  the  character  provided 
for  in  this  act. 

Same — Withdrav/al. 

Section  3999.  The  auditoi-  shall  permit  corporations  or  associa- 
tions having  a  deposit  with  him  of  such  securities  to  withdi-aw  the 
same  u])on  filing  with  him  by  the  x'l'esiclent  and  secretary  of  such 
eorpoi-atious  and  associations,  satisfactory  proof  that  they  are  to  be 
used  for  the  purpose  for  which  they  wer>^  originally  deposited  in 
his  office. 


I 


THE    t<TATE    OF    N  EUR  ASK  A  629 

Same- — Collection. 

Seel  inn  4(l(Hl.  'J'hc  aiiililiir  sluill  jnu'iiiit  coi'poi'ations  or  associa- 
)ii)iis  li,-iviiJii'  (in  deposit  with  liiiii  such  stocks  and  l)onds,  notes,  or 
oilier  securities,  to  eollect  and  retain  the  iideresl  aceruini;'  on  sueli 
(K'liosits,  delivei'ing-  to  them  res|>eeti\'ely  the  evidence  of  interest  as 
the  same  l)ecoim's  due.  l)ul  on  (lei'anlt  of  an\'  corporation  or  asso- 
ciation to  m(d<t'  or  enforce  such  collection,  he  may  collect  such  in- 
terest and  add  the  same  to  the  secui'ities  in  his  possession  belonirinji- 
to  such  corporation  oi'  association,  less  the  expense  of  such  collection. 

Failure  to  Make  Statements — Malfeasance. 

Section  4(101.  Whenever  an\'  Nebraska  association  or  corporation 
sliall  fail  to  make  its  animal  statement  to  the  auditor  on  or  before 
the  first  day  of  JIai'ch.  or  is  conducting-  its  luisiness  fraudnlently 
or  not  in  compliance  with  this  act  or  is  not  carryin<;-  out  its  contract 
with  its  members  in  g-ood  faith,  then  it  shall  be  the  duty  of  the 
auditor  to  promptly  communicate  the  fact  to  the  attorney  general, 
who  shall  at  once  c(nnmenee  action  before  the  district  in-  circuit 
court  of  the  county  in  which  said  organization  is  located  or  any 
judge  thereof,  citing  the  officers  to  appear  before  said  court  or  judge, 
anil  if  u]ion  a  hearing  of  said  cause,  it  is  fountl  to  be  (for)  the  best 
interests  of  the  holders  of  the  certificates  of  membership  in  said  cor- 
poration, said  court  or  judge  shall  have  the  power  to  remove  any 
officer  or  officers  of  said  corporation  and  appoint  others  iii  their  place 
until  the  next  annual  election.  If  it  is  fouiul  to  the  best  interests 
of  said  holders  of  certificates  that  the  affairs  of  said  corporation  be 
woinid  up  said  court  or  judge  shall  so  direct  and  for  that  purpose 
may  appoint  a  receiver,  who  shall  regard  all  ])roiier  claims  for  death 
benefits  as  preferred  claims.  Said  receiver  may  also  upon  the  ap- 
proval of  the  court  or  judge  transfer  the  members  of  said  association 
who  consent  thereto  to  some  solvent  Nebraska  assessment  or  natural 
premium  association  or  divide  the  surplus  accumulated  in  proportion 
to  the  share  due  eaeli  certificate  in  force  at  the  time. 

Certificate  of  Incorporation. 

Section  4002.     On  compliance  with  this  act  by  any  corporation  or 


630  FRATERNAL    SOCIETY    LAW 

association  the  iiuditor  shall  issue  a  c-ertiheate  setting  forth,  First — 
The  corporate  name  of  the  association.  Second — Its  principal 
place  of  business.  Third — The  number  of  certificates  or  policies  in 
force  at  the  date  of  its  last  report.  Fourth — The  sum  of  money 
which  an  ordinary  assessment  for  payment  of  a  single  certificate  or 
policy  would  produce  in  each  class.  Fifth — The  amount  paid  on  its 
last  death  loss  as  evidenced  by  proof  on  file  in  his  office  anil  the  date 
of  such  payment.  Sixth — The  amount  of  securities  de|j(jsited  in  his 
office,  and  for  what  purpose  deposited.  Seventh — That  it  has  fully 
complied  with  the  provisions  of  this  act,  and  is  authorized  to  trans- 
act business  for  a  period  of  one  year  from  April  1st  of  the  year  of 
its  issue,  which  certificate  shall  lie  published  by  said  association 
for  four  weeks  in  a  newspaper  of  general  circulation  published  at 
the  jirincipal  jtlace  of  business  of  said  association. 

Fraud  of  Agent,  Physician,  Etc. 

Section  4<l(l.3.  Any  agent,  physician,  or  other  person,  who  shall 
knowingly  and  by  means  of  concealment,  or  false  or  fraudulent 
statements,  assist  in  securing  from  any  such  organization,  or  assess- 
ment association,  a  policy  or  certificate  of  membership  on  the  life 
of  any  person,  shall  be  deemed  guilty  of  a  misdemeanor,  and  upon 
conviction  thereof  shall  be  sentenced  to  pay  a  fine  not.  exceeding 
one  thous;ni(l  ilolbii's.  or  undergo  an  imjirisonment  of  not  more  than 
one  year  in  the  county  .iail,  oi-  both,  in  the  discretion  of  the  court. 

Natural  or  Stipulated  Premium  Plan  Companies. 

Section  40(14.  Any  (■(U'poiMtioii  or  association  doing  business  in 
this  State  which  provides  in  the  main  for  the  ])aynu^nt  of  death 
losses  or  accident  indemnity  by  ;iiiy  assessment  upon  its  members, 
or  upon  the  natural  premium  plan,  or  upon  the  stipulated  premium 
]ilan.  shall,  for  the  purpose  of  this  act,  be  deemed  a  mutual  benefit 
association.  No  corporation  or  association  operating  upon  the  assess- 
ment plan,  oi'  upon  any  plan  other  than  the  mitural  premium  plan, 
or  stipulated  premium  plan,  as  hereinafter  provided  in  this  act, 
promising  benefits  upon  any  other  (>vent  than  that  of  the  death,  or 
disability  dI'  llic  mcmbei-  resulting  from  accident,  shall  be  permitted 


THE    STATE    OF    NEBltASKA  631 

to  (|(i  liiisinrss  ill  this  Stnl<',  ami  it  shall  lie  iinlawriil  for  any  siifh 
assoriatidii  or  coriKiral  ion  now  dv  luTt^after  org'aiii/i'd  or  authorized 
iiiidiT  tliis  act,  to  |ii-ovi(l('  lor  or  promise  cash  suri-eiulcr  values, 
exti'iuled  oi'  paid  up  insiiraiice,  eiidowiiients,  or  any  rorni  of  itivest- 
iiiciit  iiisiiraiii'i'.  This  act  shall  not  relieve  any  eorjiorat  ion  or  jissess- 
meiit  association  now  doing  business  in  this  State  I'l-oin  tin'  I'liltill- 
iiieut  of  any  contract  heretofore  entered  into  with  its  inciiilicrs 
iiiitler  its  policies  or  certifi(;ates  of  membersliip.  nor  shall  any 
iiiciiiher  he  rclicvi'il  thci-ehy  from  his  or  her  part   of  said  contract. 

Same — Surplus — Rate  of  Premium. 

Section  400").  Any  sueh  natural  preminm,  or  stipulated  premium 
life  association  may  provide  for  the  equitable  distribution  of  any 
surplus  accumulated  in  the  course  of  its  business,  which  may  be  paid 
in  cash  or  ajiplied  in  the  payment  or  reduction  of  future  premiums, 
for  extended  and  paid  up  insurance,  and  for  an  equitable  cash  sur- 
render value  of  its  policies;  Provided  the  conditions  thereof  shall 
be  set  forth  in  the  certificate  of  membership  or  policies  of  such 
association  and  such  cash  surrender  value  shall  in  the  main 
be  accumulated  during  the  term  of  such  certificates  or  policies.  It 
shall  not  be  lawful  for  any  association  organized  or  transacting  busi- 
ness under  this  act  to  i.ssue  policies  upon  the  natural  premium  or  the 
stipulated  premium  plan  at  a  lower  rate  than  the  net  premium  com- 
puted on  the  basis  of  the  terms  of  the  policy  and  the  American  table 
of  mortality  and  four  and  one-half  jier  cent  interest. 

Fees. 

Section  4006.  The  State  shall  receive  from  each  insurance  cor- 
poration or  association  of  other  States  or  foreign  countries  doing 
business  in  this  State  for  each  certificate  is.sued  to  its  agents,  as  pro- 
vided in  this  act.  the  sum  of  two  dollars,  and  from  each  corporation 
or  association  organized  under  the  laws  of  this  State  the  sum  of  fifty 
cents,  said  fees  to  be  paid  into  the  State  treasury.  Any  insurance 
corporation  or  association  of  any  other  State  or  foreign  country  com- 
]i]ying  with  the  requirements  of  this  act,  before  being  authorized 
by  the  auditor  of  public  accounts,  or  commissiiuier  of  insurance  to 


632  FRATERNAL    SOCIETY    LAW 

transact  business  in  this  State,  shall  pay  into  the  State  treasury 
for  its  certificate  of  authority  to  do  business  in  this  State  the  sum 
of  twenty-five  dollars,  and  shall  pay  aimiially  into  the  State  treasury 
upon  the  dates  when  its  annual  statement  is  submitted  the  further 
sum  of  twenty  dollars,  and  each  corporation  or  association  organized 
iinder  this  act  in  this  State  shall  pay  into  the  State  treasury  for  in- 
corporation fees  the  sum  of  twenty-five  dollars,  provided,  however, 
that  the  right  to  enter  this  State  upon  the  terms  herein  named,  shall 
not  be  granted  to  any  insurance  corporation  of  any  other  State 
or  foreign  country  unless  the  same  right  upon  equally  favorable 
terms  is  extended  by  the  State  or  foreign  country  in  which  said 
corporation  is  organized  to  similar  companies,  corporations  or  asso- 
ciations organized  in  this  State. 

Extent  of  Act. 

Section  4007.  Nothing  in  this  act  shall  be  construed  to  apply  to 
any  secret  fraternal  society  nor  any  association  organized  solely  for 
benevolent  pur])oses  and  composed,  wholly  of  members  of  any  one 
oecu])ation,  guild,  profession,  or  reli.a'ious,  denomination,  provided 
that  any  such  society  or  organization  named  above  in  this  section, 
shall,  by  complying  with  the  provisions  of  this  act,  be  entitled  to 
all  the  privileges  and  be  amenable  to  the  obligations  of  this  act. 

Foreign  Companies — Fraternal  Beneficiary  Societies. 

Section  4008.  When  any  foreign  insurance  association  or  com- 
pany not  organized  in  this  State  having  assets  of  not  less  than  fifty 
thousand  ($50,000)  dollars,  shall  comply  with  the  requirements  of 
the  laws  of  this  State  and  shall  satisfy  the  auditor  of  public  accounts 
that  it  is  in  a  solvent  condition  and  alile  to  meet  its  obligations  at 
maturity,  he  shall  issue  such  company  a  certificate  .stating  that  such 
coini)any  ,has  comjilied  with  the  laws  of  this  State.  Provided,  that 
I)urely  mutual  foreign  accident  associations  or  corporations  shall  not 
lie  nM)uii'e(l  to  have  the  assets  required  by  this  Section  as  a  condition 
jjrccedent  to  its  being  licensed  to  do  business  under  this  Act.  Pro- 
vided further,  that  this  Act  shall  not  apply  to  any  Fraternal  Bene- 
ficiar\'  Socii'tv  or  Association. 


THE    STATE    OF    NEBRASKA  633 

Acts  Repealed. 

Section  rtOUy.  All  acts,  or  parts  of  acts,  coiiliict  inu  willi  this  act 
arc  hereby  repealed. 

Foreign  Companies — Compliance  with  Foreign  Laws. 

Section  4010.  Whenever  the  existing  or  future  laws  of  any  other 
State  of  the  United  States,  or  the  rules  and  regulations  of  the  insur- 
ance department  of  any  such  State,  shall  require  of  life  insurance 
companies  organized  under  tlie  laws  of  this  State  any  deposit  of 
securities  in  such  State  for  the  spc\irity  of  the  policy  holders,  or  any 
payment  of  taxes,  fines,  penalties,  certificates  of  authority,  licenses, 
fees,  or  require  any  other  duties,  examinations,  or  acts  than  are  by 
the  laws  of  this  State  required  of  such  couipanies  organized  under 
the  laws  of  such  other  State,  then  the  auditor  of  public  accounts 
shall  immediately  require  from  every  insurance  company  of  any 
and  every  character  whatever  of  such  other  State  transacting  or 
seeking  to  transact  business  in  this  State,  the  like  payment  of  all 
licenses,  fees,  taxes,  fines  or  penalties,  and  the  like  making  of  all 
deposits  of  securities  and  statements,  and  the  like  doing  of  all 
acts  which  by  the  laws  or  rules  of  the  insurance  department  of  such 
other  State,  are  in  excess  of  the  licenses,  fees,  taxes,  deposits,  state- 
ments, fines,  penalties,  acts,  examinations  or  duties  required  by  the 
laws  of  this  State  of  the  companies  of  such  other  States. 

Security  for  Policy  Holders. 

Section  4011.  No  company  organized  under  the  laws  of  this  State 
for  the  purpose  of  transacting  the  business  of  life  insurance  with 
a  capital  stock,  shall  continue  or  commence  business  mitil  such 
company  has  transferred  to  and  deposited  with  the  auditor  of 
public  accounts  for  the  security  of  its  policy  holders  the  sum  of 
one  hundred  thousand  dollars  in  the  kinds  of  securities  afe  provided 
by  the  laws  of  this  State;  but  in  no  case  shall  such  securities  be 
received  at  a  rate  above  their  par  value  nor  above  their  current 
luai-ket  value. 


634  FRATERNAL    SOCIETY    LAW 

Statutes  of  Foreign  State— Presumptions. 

The  statutes  of  a  foreign  State  will  be  prfsiimed  to  he  the  same 
with  respect  to  fraternal  societies  as  those  nf  tliis  State. 

Fisher  vs.  Donovan,  Jany.,  1899,   57  Nebr.  361. 

Beneficiary — Creditor  Cannot  Be. 

Upon  the  death  of  a  member  the  property  in  a  certificate  vests 
absolutely  in  the  beneficiary  and  creditors  have  no  right  nor  any 
interest  in  the  same. 

Fisher  vs.  Donovan.  Jany.,  1899,  57  Nebr.  361. 

Forfeiture — Waiver  of. 

A  secret  intention  to  insist  upon  a  forfeiture  cannot  prevail 
against  deliberate  acts  with  knowledge  of  the  facts  upon  which 
the  forfeiture  might  be  asserted,  and  which  in  law  amount  to  a 
waiver  of  such  forfeiture. 

Modern  Woodmen  of  America  vs.  Lane.  June,  1901.  62  Nebr.  89. 

Benefit  Fund — Creditors  Can  Acquire  No  Rights  In. 

A  member  of  a  fraternal  society  has  no  such  interest  or  iiroitcrty 
in  the  proceeds  of  a  certificate  issued  to  him  therein,  that  he  can 
impress  such  proceeds  with  a  trust  in  favor  of  his  creditors. 

Fisher  vs.   Donovan,   Jany.,   1899,   57  Nebr.   361. 

Beneficiary — Change  of — No  Vested  Interests. 

A  member  holding  a  certificate  may,  at  his  o])tion.  change  the 
beneficiaiy  therein,  so  long  as  he  complies  with  the  laws  of  his 
society  and  kcrps  within  its  limitations  and  those  of  the  statute 
under  which  it  is  organized.  A  certificate  is  a  mere  expectancy 
and  the  beneficiai'v  lias  no  vested  interest  therein. 

Fisher  vs.    Donovan,   Jany.,   1899,   57  Nebr.   361. 


rilF,     KTATK    OF    XKIih'AHKA  «35 

Evidence — Proofs  of  Death  Admissible. 

I'roofs  di'  death  filed  by  n  beneficiai-y  arc  adiiiissililc  in  cNidriice 
sid),ji'et  to  explanation  or  correction,  and  iiniy  tie  uscmI  as  admis- 
sions auainst  Intercast.  1'lie  \veit;lit  to  be  given  to  sncli  admissions 
is  a  question  for  the  jury,  and  to  be  determined  u])on  eonsideration 
of  all  the  facts  and  circninstances  showing  or  lendinii-  to  show  a 
knowledge  on  the  jiai-t  <>\'  the  beneficiary  of  tlicii-  eonti-iils  <>>■  otlicr- 
wise. 

Modern  Woodmen  of  America  vs.  Kozali,  Dec.  I'JUl,  tVi  Nebr.  146. 

Reinstatement — Waiver  of  Requirements. 

The  I'ules  of  a  society  jirovided  that  the  non-payments  of  assess- 
ments should  operate  as  a  susjiension.  and  that  a  mend)er  under 
sns])ension.  in  order  to  be  reinstated,  should  make  proof  of  good 
health.  They  also  provided  that  only  members  in  good  standing 
might  change  their  beneficiai'ies.  such  change  to  be  made  by  sur- 
rendering the  certificate,  paying  a  fee.  and  obtaining  a  new  certifi- 
cate. Held,  that  the  cancellation  of  a  prior  certificate,  retention  of 
the  fee  for  issuing  a  new  one  with  change  of  beneficiary,  and  the 
issuance  of  the  new  one  accordingly,  amounted  to  a  waiver  of  such 
requirements  for  reinstatement  though  the  member  was  not  in  good 
health  at  the  time. 

Modern  Woodmen  of  America  vs.  Lane.  June,  1901.  62  Nebr.  89. 

The  Loss  of  Certificate  Does  Not  Prevent  Suit  on  Same. 

The  manual  possession  of  a  benefit  certificate  in  case  it  is  in  force 
and  binding,  is  not  necessary  in  order  to  maintain  an  action 
upon  it. 

National  Aid  Ass'n  vs.  Bratcher.  July,  1902.  65  Nebr.  378. 

Members  Separated  Into  Classes. 

As  t<:i  the  right  of  a  soeiet\'  to  classify  its  mendiers  according  to 


636  FRATERNAL    SOCIETY    LAW 

the  risk  or  hazard  that  tliey  impose  niioii  the  soeiety  i)y  reason  of 
their  respeetive  <nialifieatioiis.   see 

Doody    vs.    National    Masonic    Accident    Ass'n.    November,    1902.    66 
Nebr.   493. 

Warranties — Materiality  Determined  by  Contract. 

Parties  to  a  contract  may  determine  what  questions  and  answers 
are  material  to  the  risk,  and  where  that  is  done,  inquiry  cannot  be 
made  into  the  materiality  of  answers,  but  whether  answers  by  the 
applicant  are  true  or  false,  is  a  question  of  fact  to  be  determined 
by  the  jury. 

Royal   Neighbors  of  America  vs.  AVallace.   December,   1902,   6fi  Nebr. 
543. 

Precedent  Conditions  to  Liability. 

Where  an  application  declares  on  its  face  that  payment  of  the 
first  assessment  and  membership  fee  is  a  condition  precedent  to 
membership  and  to  the  issuance  of  the  certificate,  and  the  by-laws 
contain  the  same  provision,  the  applicant  does  not  become  a  member 
and  the  certificate  issued  is  not  in  force  until  payments  are  acl^Tally 
made. 

National  Aid  Ass'n  vs.  Bratcher,  July,  1902,  65  Nebr.  378. 

Local  Officials  Without  Power  to  Waive  Laws. 

Officers  of  subordinate  lodg'es  have  no  authority  by  reason  merely 
of  such  office  to  waive  any  of  the  provisions  of  the  rules  and  regu- 
lations of  the  society  which  enter  into  and  form  a  part  of  the  con- 
tract of  membership.  Where  one  of  the  laws  of  a  societ.y  provided 
that  a  suspended  member  can  be  reinstated  only  while  in  good 
health,  the  receipt  of  the  member's  dnes  1)y  a  snliordinate  officer 
while  the  member  is  iu  a  dyinL;-  condilion  is  not  a  waiver  of  the 
rr(|niri'ments  of  good  health. 

Royal   Highlanders  vs.  Soovill,  Novcmbe'r.  1902,   dfi  Nebr.  213. 


i 


THE    HTATE    OF    NEBRASKA  (j37 

Waiver  of  Laws  Not  to  be  Presumed  From  Mere  Acceptance  of  Pay- 
ment. 

Tlic  i-i'ri'i|it  (if  iiK 111 cy  })\  1  lie  liii;inci;il  (il'liciT  ol'  ;i  si ilidrdinate  lodge 
is  iKil  liy  itself  a  waiver  of  (ilhcr  ennditinns  tof  thi'  reinstatement  of 
the  suspended  member. 

Adams  vs.  Grand  Lodge  A.  O.   U.  W..  November.  1902.  C6  Nebr.  389. 

Agency  of  Local  Lodge  Respecting  Payment  of  Benefits. 

Wiiei'e  iKi  .■lutluirity  (iver  the  puyiiieiit  of  death  benefits  exists  in 
a  subordinate  lodge  the  netjotiations  and  dealings  between  the  bene- 
ficiary and  the  lodge  ofHeials  after  tlie  menilH'f's  death  can  establish 
no  liability  against  the  soeiety. 

Adams  vs.  Grand  Lodge  A.  0.  U.  W..  November,  1902.  66  Nebr.  389. 

Agency — Duty  of  Local  Officials. 

If  is  file  duty  of  an  agent  to  make  known  to  his  jn-incipal  all  facts, 
concerning  the  services  in  which  he  is  engaged  that  come  to  his 
knowledge  in  the  course  of  his  employnii-nf,  and  he  is  jiresumed  to 
have  complied  with  this  duty  in  a  subsequent  action  between  the 
member  and  a  third  i^erson.  This  is  lield  to  be  a  rule  founded  in 
.justice  and  existing  to  protect  the  luiblie. 

Modern  Woodmen  of  America  vs.  Coleman,  April,  1903,  68  Nebr.  660. 

Rights  of  Members  as  to  Funds. 

A   member  of  a  society  has  no  sueh   inter'est  or  iiroperfy   in  the 
■  proceeds  of  a  certificate  as  will  enable  him  to  appi'oiiriate  sueh  pro- 
ceeds in  the  favor  of  his  estate  and  its  creditoi's. 

Warner  vs.   Modern   Woodmen   of  America.   .January,   1903.   67   Nebr. 
233. 

Beneficiaries  Limited  by  Statute. 

Where  the  laws  of  a  society  and  the  statutes  of  the  State  prescribe 


638  FRATERN-AL    SOCIETY    LAW 

the  class  of  persous  that  may  be  beueticiaries  of  the  members,  and 
where  a  member  dies  leaviiiii'  no  one  belonging  to  such  classes,  his 
administrator  cannot  recover  against  the  society-  on  such  certificate, 
and  the  fund  cont('iii]ilate(l  by  the  certificate  will  revert  to  the 
soeiet.y. 

Warner  vs.   Modern   Woodmen   of   America,   January.   1903,   67   Nebr. 
233. 

Denial  of  Liability  Removes  Ear  to  Suit. 

Where  a  society  denies  all  liability  on  its  contract,  basing  its 
refusal  to  pay  on  the  ground  that  the  loss  insured  against  has  not 
occurred,  suit  may  be  brought  u]hi}i  tln'  contract  without  Avaiting 
for  the  expiration  of  the  i)erio(l  limiting  the  ti"ie  within  which  tlie 
Mction  may  b(>  brought. 

Modern  Brotherhood  of  America  vs.  Cummings,  March.  1903.  fiS  Nebr. 
256. 

Fraternal  Society  is  a  Mutual  Life  Insurance  Society. 

A  society  which  issueil  certificates  to  its  meuiliers.  payable  from 
a  fund  maintained  by  assessments  upon  certificate  holders  is  in 
effect  a  mutual  life  insurance  company,  and  is  governed  by  tlii» 
general  law  applicable  to  such  companies. 

Modern  Woodmen  of  America  vs.  Coleman,  .April.  1903.  (i8  Nebr.  660. 
This  is  a  rehearing  of  the  same  ease  reported  in  64  Nebr.  162. 

Forfeiture — Waiver  of. 

A  forfeitui'c  incurred  by  a  incniln'r  is  waived,  if  the  society,  with 
a  knowledge  of  the  facts,  subseipiently  collects  assessments  on 
account  of  the  conti-aet.  and  retains  them  without  objection  until 
after  the  death  of  tlic  nn'nibcr. 

Modern  Woodmen  of  America  vs.  Coleman,  A|)ril.  1903,  68  Nebr.  660. 


I 


THE    STATE    OF    NEIih'ASKA  (J39 

Beneficiary — Changes  of. 

.Menihci's  luivc  tin-  I'ii^lil  iimliT  tlii'  sljitutc.  ;i1  ;jiiy  time,  with  the 
consent  nl'  (lie  sdeii-ly,  In  sniislitnle  one  Iieneliei;ii'y  i"oi'  anolhef. 

Woodmen  Accident    Ass'n   vs,   Hamillon.   .lanuary.   tOlM,   70   Nebr.   24 
and  30. 

Waivers  Not  to  be  Presumed. 

The  permanent  waiver  of  the  conditions  in  a  contract  of  insurance 
siumld  not  he  inferred  from  occasional  indulgences  shown  the 
member. 

Parker  vs.   Knights  Templars  and  Masons'  Life   Indemnity,  Novem- 
ber. 1903,  70  Nebr.  2BS, 

Beneficiary — Change  of. 

An  application  for  ehanue  of  Ix'iiefieiary  which  does  not  reach  the 
head  office  until  aftei-  the  death  of  the  member,  and  is  then  refused 
because  of  not  being  in  accordance  with  the  laws  a.s  to  a  part  of  the 
fund,  such  refusal  has  no  effect  as  to  the  fund  in  refei-ence  to  which 
it  is  in  proper  form. 

Counsman    vs.    Modern    Woodmen    of    America.    September,    1903.    69 
Nebr.   710. 

Restrictions  as  to  Age. 

Societies  are  not  allowe(_l  to  take  members  who  are  above  the  age 
limit,  or  without  medical  examination,  nor  can  this  be  chine  indi- 
reetl.v  by  the  purchase  of  the  business  and  records  of  another  similar 
society  and  consolidating  such  society  with  its  own. 

State  vs.   Banker's  Union,   April.   1904.   71    Nebr.   622. 

Solvent  Society — Definition  of. 

The  assets  of  a  fraternal  societ.y  do  not  consist  alone  in  cash  and 
tangible  securities  and  propert.v.     If  its  plan  of  business  is  feasible 


640  FRATERNAL    SOCIETY    LAW 

aud  just,  it  may  rely  upon  thu  g-ood  faitli  and  solvency  of  its  mem- 
bers. It  cannot  be  said  to  be  insolvent,  when  it  is  reasonably  prob- 
able that  its  authorized  assessments  will  provide  it  sufficient  funds 
to  meet  its  just  liabilities,  and  a  receiver  cannot  be  appointed  for  a 
society  which  is  not  insolvent  under  the  above  definition,  but  which 
has  simply  neglected  to  comply  with  some  of  the  jjrovisions  of  the 
law  with  reference  to  transacting  business. 

State   vs.   Banker's  Union.   April.   1904,  71   Nebr.   622. 

Suicide — Facts  in  Case. 

For  the  facts  in  a  case  where  suicide  was  set  up  as  a  defense  to 
the  claim  for  the  amount  of  the  certifieate,  see 

Sov.  Camp  W.  0.  W.  vs.  Hruby,  Oct.,  1903,  70  Nebr.  5. 

Suicide — Approximate  Cause  of  Death. 

The  fact  as  to  the  approximate  cause  of  death,  when  suicide  is 
interposed  as  a  defense,  is  a  question  for  the  jury. 

Hardinger   vs.   Modern   Brotherhood,    December,    1904,    72    Nebr.    860 
and   869. 

Suicide — Duty  of  the  Court  to  Instruct,  When. 

Where  the  defense  of  suicide  is  interposed,  and  where  the  facts 
aud  circumstances  surrounding  the  death  of  the  member  pointed 
clearly  and  unmistakably  to  the  conclusion  that  the  member  took  his 
own  life,  and  which  exclude  all  reasonable  probability  of  death  by 
murder  or  by  accident,  the  presumption  that  a  sane  person  will  not 
take  his  own  life  is  overcome  and  such  facts  establishes  at  least 
prima  facie  the  defense  of  suicide,  and  it  is  the  duty  of  the  trial 
court  upon  such  a  showing  to  direct  the  jury  to  return  a  verdict 
for  the  defendant. 

Hardinger   vs.   Modern    Brotherhood.    December.    1904.    72    Nebr.    860 
and   869. 


THE    STATE    OF    NEBRASKA  641 

Jurisdiction  for  Suit  on  Certificate. 

An  action  upon  a  certificate  is  transitory  and  not  local  in  its 
nature,  and  may  be  brought  in  whatever  State  the  society  issuing 
the  certificate  can  be  found,  without  regard  to  where  tlie  contract 
was  made,  or  the  member  residing. 

Perrine    vs.    Knights    Templars    and    Masons'    Life    Indemnity    Co., 
March,  1904,  71  Nebr.  267. 

When  Society  Does  Not  Comply  With  State  Law,  Duty  of  State 
Officials. 

When  a  society  refuses  and  neglects  to  report  to  the  auditor  as 
required  by  law,  or  shall  exceed  its  powers,  or  conduct  its  business 
fraudulently,  or  fails  to  comply  with  any  of  the  provisions  of  the 
statute,  it  is  the  duty  of  the  auditor  to  notify  the  attorney  general 
in  writing,  and  it  is  the  duty  of  the  attorney  general  to  commence 
an  action  immediately  against  such  society,  to  enjoin  it  from 
carrying  on  any  business  in  the  State. 

State'  vs.  Banlvers'  Union,  April,  1904,  71  Nebr.  622. 

Representative  Form  of  Government  Required. 

A  fraternal  societ,y  must  have  a  representative  form  of  govern- 
ment. This  requires  that  the  directors  or  other  officers  who  have 
general  charge  or  control  of  the  property  and  business  of  the  society 
and  the  management  of  its  affairs,  shall  be  chosen  by  its  members. 

State  vs.  Bankers'  Union,  April.  1904,  71  Nebr.  622. 

Corporate  Power  Limited. 

When  the  exercise  of  corporate  power  has  been  regulated  by 
statute,  the  corporation  cannot  by  its  laws  or  resolutions  change 
the  mode  of  the  operation  or  exercise  of  this  power. 

Lange   vs.   Royal   Highlanders.    December,   1905,    Supreme   Court   of 
Nebraska,  106  N.W.  224. 
41 


642  FRATERNAL    SOCIETY    LAW 

Societies  Must  Have  Representative  Government. 

A  society  must  have  a  representative  form  of  government,  and  as 
to  what  that  representative  form  of  government  is,  see 

Lange   vs.   Royal    Highlanders,    December,   190.5,    Supreme   Court  of 
Nebraska,  106  N.  W.  224. 

Societies '  Property  Right  in  Corporate  Name. 

Under  the  State  laws  a  license  cannot  be  issued  to  a  society  whose 
name  or  title  so  resembles  a  title  alreadj'  in  use  in  the  State  as  to 
have  a  tendency  to  mislead  the  public. 

Knights  of  the  Maccabees  of  the  World  vs.  Searle,  December,  ISC'). 
Supreme  Court  of  Nebraska,  106  N.  W.  448. 

Societies '  Name  Must  Not  Mislead  the  Public. 

If  the  name  or  title  of  a  societ.y  contains  a  descriptive  word,  by 
which  the  society  is  generally  known  to  the  public,  to  incorporate 
that  as  the  characteristic  word  in  the  name  of  a  proposed  new  cor- 
poration, is  held  to  have  a  tendency  to  mislead  the  public. 

Knights  of  the  Maccabees  of  the  World  vs.  Searle,  December,  1905, 
Supreme  Court  of  Nebraska.  106  N.  W.  448. 

Member  Estopped  by  Overt  Acts. 

One  cannot  attack  the  validity  of  a  delegate  meeting  'of  the  society 
where  he  pai"ticipated  in  the  meeting  and  was  a  candidate  for  one 
of  the  offices  to  be  filled. 

Burdirk   vs.   Sons  and   Daughters  of  Protection.  .January.   1906,  Su- 
preme Court  of  Nebraska.  106  N.  W.  466. 

Insurance  Department's  Discretion. 

The  auditor  of  the  State  is  elotlicd  with  discretion  in  determining 
whether  the  society  has  complied  with  the  law  and  is  entitled  to 
license  to  do  business. 


/ 


THE    STATE    OF    NEBRASKA  643 

State  ex  lel  Bankers'  Union  vs.  Searle,  October,  1905,  Supreme  Court 

of  Nebraska,  105  N.  W.  2S4. 

Mortuary  Fund  Sacred  to  Mortuary  Purposes. 

T\u'  luortiKii-y  iiind  oi'  a  society  must  l)i'  kept  scjijiriitr  and  apart 
from  (ither  funds  of  the  society.  Tlie  aiiditur  should  call  the 
attention  of  the  society  to  irregularities  ])racii<'c>d  in  regard  to  the 
preservation  of  the  mortuary  fund,  and  allow  the  society  to  comply 
with  Ihe  requirements  of  the  law  in  that  regard,  and  upon  such 
coinj)liance  should  not  refuse  to  license  on  aticonnt  of  former  irregu- 
larities. 

State  ex  rel  Bankers'  Union  vs.  Searle,  October,  1905,  Supreme  Court 
of  Nebraska,  105  N.  W.  284. 

Agency  of  Local  Officials. 

Where  members  are  required  to  pay  an  officer  of  a  local  lodge, 
whose  duty  it  is  to  remit  to  the  society  all  such  payments,  the  local 
officer  will  be  treated  and  regarded  as  the  agent  of  the  society. 

Soehner  vs.  Grand  Lodge  Sons  of  Herman,  September,  1905,  Supreme 
Court  of  Nebraska,  104  N.  W.  871. 


I 


Forfeiture — Waiver  of  and  Estoppel. 

If  with  knowledge  of  the  facts  b,y  reason  whereof  the  society  is 
entitled  to  claim  a  forfeiture,  it  continues  to  treat  the  contract  as  in 
force,  or  does  no  act  inconsistent  with  an  intention  to  insist  upon 
forfeiture,  the  forfeiture  will  be  deemed  waived. 

Soehner  vs.  Grand  ]_,odge  Sons  of  Herman,  September,  1905,  Supreme 
Court  of  Nebraska,  104  N.  W.  871. 

Warranty  and  Misrepresentations — Good  Faith  of  Member. 

Questions  and  answers  in  an  application  are  to  be  construed  most 
strongly  against  the  society,  and  whether  such  questions  and 
answers  are   so  framed  that  the  member  mav  have  honestly  mis- 


644  FRATERNAL    SOCIETY    LAW 

taken  their  trne  iiiijiort,  and  given  Miiswers  thei'etn  which  are.  in 
fact,  untrue,  but  true  as  he  may  have  reasonably  understood  the 
questions,  is  for  the  ,iury  to  say  in  the  light  of  the  entire  transac- 
tion, whether  the  member  acted  honestly  and  in  good  faith,  and 
without  intention  to  mislead  or  conceal  any  material  fact. 

Modern    Woodmen    of    America    vs.    Wilsou.    April,    1906,    Supreme 
Court  of  Nebraska,  107  N.  W.  568. 

Warranty — Immaterial  Questions  and  Answers. 

Where  questions  in  a  medical  examination  called  for  the  name 
of  the  ailments  for  which  the  applicant  has  been  treated,  and  the 
names  of  the  physicians  who  treated  him,  the  member  is  not 
required  to  give  the  name  of  every  ailment,  however,  trifling,  or  of 
every  physician  he  has  consulted,  but  may  confine  his  answer  to 
such  ailments  as  are  of  a  serious  nature.  For  the  facts  in  a  case 
where  this  doctrine  was  annonnced,  see 

Modern    Woodmen    of    America    vs.    Wilson.    April,    1906.    Supreme 
Court  of  Nebraska,  107  N.  W.  568. 

Initiation  a  Condition  Precedent. 

Where  the  laws  required  as  a  condition  precedent  to  liability,  that 
applicants  shall  be  initiated,  and  shall  make  an  advance  payment 
of  one  assessment,  the  fact  that  an  application  has  been  accepted  and 
the  membership  fee  paid,  will  not  entitle  an  applicant's  beneficiary 
to  recover  on  the  certificate  in  the  event  of  the  apjilicant's  death 
before  he  has  been  initiated. 

Royal  Mystic  Legion  of  America  vs.  Richardson.  May,  1906,  Supreme 
Court  of  Nebraska,  107  N.  W.  795. 

Assessments  Required  Monthly  if  Called. 

Where  the  laws  provide  that  monilicrs  shall  iiay  one  assessment 
each  month,  unless  certain  designated  officers  determine  its  payment 


I 


THE    STATE    OF   NEBRASKA  645 

unnecessary,  tlic  payiiicnl,  ol'  siieh  iisscssmciit,  when  cnllnd  for,  can- 
not be  resisted  on  tlir  uronnd  lliat  it  was  unlawrnllv  made. 


Sovereign  Camp  Woodmen  of  the  World  vs.  Ogden,  May,   190G,  Su- 
preme Court  of  Nebraska,  1(»7  N.  W.  860. 


Suicide — After-enacted  Laws. 

At'ttT-enac-tiHl  by-laws  which  arc  reasonable  in  tiicir  nature,  and 
hiwl'nlly  enacted  will  be  upheld,  :ind  an  at'ter-enacted  suicide  law, 
excepting'  the  rislc  of  suicide,  wbctber  tlie  member  be  sane  or  insane, 
is  not  an  unreasonable  by-law. 


Lange    vs.    Royal    Hi.s;hlanders.    December,    1905.    Supreme   Court   of 
Nebraska,   lOi;   N.   W.   224. 


After-enacted  Laws — Collateral  Attack. 

An  attiick  upon  the  validity  of  a  by-law,  on  the  ground  that  the 
society  was  without  jiowit  to  enact  the  same,  does  not  amount  to  a 
collateral  attack  on  the  society's  right  to  do  Imsiness. 

Lange  vs.  Royal  Highlanders.  Feb.,  1907,  Supreme  Court  of  Nebraska, 
110  N.  W.  1110. 

Forfeiture — Waiver  of. 

A  waiver  of  a  condition  in  a  contract  will  not  be  implied  from  an 
act  M-hicli  is  not  inconsistent  with  an  intention  to  insist  upon  per- 
foi-mance  of  the  contract. 

DriscoU    vs.    Modern    Brotherhood    of    America.    Oct.    1906.    Supreme 
Court  of  Nebraska,  109  N.  W.  158. 

Conditions  Precedent — Unauthorized  Delivery  of  Certificate. 

Where  the  laws  of  a  soeiet.y  require  the  initiation  of  a  member 
as  a  condition  precedent  to  the  delivery  to  him  of  a  certificate,  the 
unauthorized  delivery  of  such  certificate  by  a  subordinate  lodge 
officer  before  initiation,  will  not  operate  as  a  waiver  of  the  condition. 


646  FRATERNAL    SOCIETY    LAW 

Driscoll    vs.    Modern    Brotherhood    of   America.    Oi-t.    190G,    Supreme 
Court  of  Nebraska.  109  N.  W.  158. 

Agency — No  Right  to  Waive  Laws. 

The  collecting  officer  of  a  subordii:ate  lodge  by  virtue  of  his  au- 
thorit}-  to  receive  payment  from  members  of  their  asse.ssments, 
has  no  authorit.y  to  receive  payments  from  non -members,  and  in 
case  he  does  so  without  the  knowledge  or  consent  of  the  society,  of 
any  of  his  acts  in  that  behalf,  to  repudiate  such  act.  the  society  is 
not  estopped  to  deny  that  the  persons  thus  makino;  payment  are 
members.     An  agent  cannot  bind  by  his  own  uuaiitbin'i/.ed  acts. 

Driscoll   vs.   Modern   Brotherhood   of   America,   Oct.,    1905.    Supreme 
Court  of  Nebraska,  109  N.  W.  158. 

After-enacted  Laws — Increase  of  Member's  Payments. 

The  payments  required  from  members  may  be  increased  if  it  is 
found  that  such  increase  is  necessary  to  meet  the  requirements  of 
the  society  honestly  administered. 

Shepperd  vs.  Bankers'  Union,  June,  1906,  Supreme  Court  of  Nebraska, 
108  N.  W.  188. 

After-enacted  Laws  Valid. 

The  laws  of  a  soeiet.x'  jjrovided  that  on  the  death  of  a  member  the 
amount  due  luider  his  certificate  should  be  ascertained  by  deduct- 
ing from  its  face  value,  the  monthly  assessments  from  the  date  of 
the  death  to  the  expiration  of  his  life  expectanc.v  with  4%  interest 
thereon.  Subsequent  1o  the  issuance  of  the  certificate  the  laws 
were  changed,  increasing  the  monthly  assessments  to  be  collected 
from  members,  and  provided,  that  such  increased  assessments  should 
be  collected  only  from  members  thereafter  .ioining,  and  that  as  to 
members  continuiiig  to  pay  at  the  old  rate  to  tlu-  time  of  their 
death,  the  increase  over  the  old  rate  to  be  deducted  from  their  cer- 
tificates. Held,  that  the  society  had  the  right  to  deduct  from  the 
certificate  the  difference  between  the  old  rate  and  tlie  new  rate,  pro- 
vided, by  the  new  la\v,  ei)ni|iu1ed  IVniii  tlu'  time  when  the  new  rate 


I 


THE    STATE    OF    NEBRASKA  647 

went  into  effect  to  the  death  of  the  momber.  but  not  for  the  balance 
of  his  life  expectancy. 

Sheppard  vs.  Bankers'  Union,  June,  1906,  Supreme  Court  of  Nebraska, 

108  N.  W.   188. 

Evidence — Books  of  Subordinate  Lodges. 

In  a  suit  in  which  a  subordinate  lodge  is  a  ])arty,  the  books  and 
records  of  the  lodge,  when  properly  identified,  are  receivable  in 
evidence  against  the  members  of  said  lodge  and  their  privies. 

Union  Pacific  Lodge  A.  O.  U.  W.  vs.  Bankers'  Surety  Co.,  Oct.,  1907, 
Supreme  Court  of  Nebraska,  113,  N.  W.  263. 

Surety  on  Bonds— Estopped  From  Denying  Incapacity  of  Principal. 

Where  a  surety  compan.y  issues  a  contract  indemnifying  a  fra- 
ternal society  from  loss  by  larceny  or  embezzlement  by  its  officers, 
the  contract  not  being  illegal,  the  surety  company  will  be  estopped 
from  denying  the  legal  capacity  of  the  society  in  an  action  brought 
to  recover  for  loss  sustained  under  the  surety  contract. 

Union  Pacific  Lodge  A.  O.  U.  W.  vs.  Bankers'  Surety  Co.,  Oct.,  1907, 
Supreme  Court  of  Nebraska,  113,  N.  W.  263. 

Agency — Local  Officials. 

A  subordinate  lodge  and  collecting  officer  thereof  whose  duty  it 
is  to  receive  and  forward  to  the  society  the  dues  from  members,  are 
held  to  be  the  agents  of  the  society. 

Pringle  vs.  Modern  Woodmen  of  America,  July,  1907,  Supreme  Court 
of  Nebraska,  113  N.  W.  231. 

Agency — Waiver  of  Laws. 

The  collection  of  dues  and  assessments  from  a  member  who  has 
been  convicted  of  a  felony,  by  the  collector  of  a  subordinate  lodge, 
with  full  knowledge  of  the  fact  of  such  conviction,  which  dues  and 
assessments  are  forwarded  to  and  retained  by  such  society,  in  a 


648  FRATERNAL   SOCIETY   LAW 

suit  after  the  death  of  the  member,  was  held  to  be  a  waiver  of  the 
forfeiture  of  the  member's  certificate  on  the  ground  of  such  con- 
viction. 

Pringle  vs.  Modern  Woodmen  of  Amerif-a,  July,  1907,  Supreme  Court 
of  Nebraska,  113  N.  W.  231. 

Beneficiaries — Change  of — No  Vested  Interests. 

"Where  members  have  the  right  to  designate  and  change  their 
beneficiaries  at  pleasure,  beneficiaries  are  not  parties  to  the  con- 
tract and  have  no  vested  rights  therein  during  the  life  of  the 
member. 

Ogden    vs.    Sovereign    Camp    Woodmen    of   the    World.    April.    1907, 
Supreme  Court  of  Nebraska,  111  N.  W.  797. 

Evidence — Admissions  of  Members. 

In  a  suit  upon  a  contract,  where  the  issue  is  as  to  the  good  stand- 
ing of  the  member  at  the  time  of  his  death,  his  statements  which 
tend  to  show  his  understanding  of  his  status  in  the  society,  are 
admissible  in  evidence  in  favor  of  the  society. 

Ogden    vs.    Sovereign    Camp    Woodmen    of    the    World,    April,    1907, 
Supreme  Court  of  Nebraska.  Ill  N.  W.  797. 

Forfeiture —  Collector 's  Neglect. 

"When  it  is  the  custom  of  a  collecting  officer  to  receive  by  mail 
remittances  from  members  at  a  certain  postoffiee.  and  the  official 
stationery  of  such  officer  designated  that  postoffiee  as  his  address, 
and  remittances  of  an  assessment  properly  addressed  to  such  officer, 
which  reaches  the  designated  postoffiee  on  the  day  when  it  was  due, 
is  held  a  payment  of  the  assessment  where  there  was  no  provision 
in  the  contract  to  the  contrary,  notwithstanding  the  fact  tnat  the 
money  was  not  delivered  until  later  to  the  officer,  who  unknown 
to  the  member,  had  changed  his  place  of  receiving  mail. 

Vanrura   vs.  Zapadni.  April,   1907.   Supreme  Court  of  Nebraska,  111 
N.  W.  845. 


THE    STATE    OF   NEBRASKA  649 

Resort  to  Civil  Courts — Unreasonable  Restrictions  Against. 

A  law  of  a  society,  which  requires  an  appeal  from  the  action  of 
its  oificers,  vested  with  authority  to  allow  or  reject  death  claims, 
to  the  supreme  body  whose  action  thereon  is  declared  to  be  final,  was 
held  unreasonable  and  void  as  against  public  policy,  and  on  tEis 
point  the  court  said,  "to  pursue  a  remedy  provided  by  the  laws 
of  the  defendant  would  require  probabh'  three  and  possibly  four 
years  to  present  the  claim  finally  to  its  supreme  court,  and  for  the 
purpose  of  the  appeal  perhaps  to  follow  that  body  into  a  foreign 
land,  a  course  that  practically  amounts  to  a  denial  of  justice.  The 
provisions  are  not  only  unreasonable  in  substance  but  more  so  on 
account  of  the  length  of  time  and  expense  involved  in  following 
them  to  a  legitimate  end.  The  collection  of  indemnity  provided  by 
life  insurance  should  be  a  speedy  and  simple  process,  and  it  is  a 
praiseworthy  fact  that  most  life  insurance  societies  are  constantly 
simplifying  forms  of  proof  and  convenience  of  collection,  an  ex- 
ample that  might  well  be  followed  by  all." 

Markham  vs.   Supreme  Court   Independent  Order  of   Odd   Fellows, 
January,  1907,  Supreme  Court  of  Nebraska,  110  N.  W.  638. 

Self-Executing  Forfeiture  Laws. 

A  by-law  of  a  society  which  provides  for  the  suspension  of  a  mem- 
ber for  non-payment  of  monthly  dues  without  further  notice  than 
that  imported  by  the  by-law,  is  reasonable  in  its  nature  and  will  be 
upheld. 

Nelson   vs.    Modern    Brotherhood   of   America,    Feb.,    1907,    Supreme 
Court  of  Nebraska,  110  N.  W.  1008. 

After-enacted  Laws — Representative  Government. 

Where  a  society  has  not  complied  with  the  statute  and  adopted  a 
representative  form  of  government,  its  governing  body  is  without 
power  to  adopt  a  law  changing  the  terms  and  obligations  of  its  con- 
tracts issued  to  one  of  its  members. 

Lange  vs.  Royal  Highlanders,  Feb.,  1907,  Supreme  Court  of  Nebraska, 
110  N.  W.  1110. 


650  FRATERNAL    SOCIETY    LAW 

Suicide — No  Intent  When  Applying  for  Certificate. 

Suicide  will  not  defeat  a  recovery  on  a  certificate  when  not  pro- 
cured by  the  member  with  the  intention  of  committing  suicide  unless 
the  contract  so  provides  in  express  terms. 

Lange  vs.  Royal  Highlanders,  Feb.,  1907.  Supreme  Court  of  Nebraska, 
110  N.  W.  1110. 

Taxation  of  Funds  of  Fraternal  Societies. 

Some  few  j'ears  ago  the  State  Board  of  Assessments  and  Taxation 
of  Nebraska,  observing  the  millions  of  dollars  accumulated  and  con- 
stantly increasing  in  amount  held  by  fratei-ual  societies  in  that  State, 
conceived  the  idea  they  could  best  serve  the  people  of  that  State  by 
subjecting  these  funds  to  schedule  and  taxation  as  well  as  the  prop- 
erty and  funds  of  corporations  organized  for  profit.  In  conseqiience 
of  which  they  ordered  the  local  assessors  of  each  county  to  assess 
the  reserve  or  emergency  funds  of  all  societies  found  in  their  re- 
spective counties.  The  tax,  if  imposed,  would  have  cost  the  societies 
a  large  sum  of  money  per  year  for  taxes.  One  society  alone,  it  is 
estimated,  would  have  had  to  paj^  $100,000  annually. 

A  test  case  was  made  in  that  of  the  attempt  to  tax  the  Royal 
•Highlanders,  a  society  with  headquarters  at  Aurora.  This  attempt 
was  resisted  upon  several  grounds,  two  of  which  are  of  interest. 
First,  that  the  funds  were  exempt  from  taxation  under  the  constitu- 
tion of  Nebraska,  for  the  reason  that  they  were  used  and  devoted 
to  charitable  purposes  within  the  meaning  of  the  constitution ;  and, 
second,  that  the  Society  was  entitled  to  set  off  the  amount  of  its 
outstanding  benefit  certificates,  matured  and  unmatured,  against  its 
fidelity  or  mortuary  fund. 

Tlie  constitution  of  Nebraska  confers  the  power  upon  the  legis- 
lature by  general  law  to  exempt  from  taxation  all  property  used 
exclusively  for  charitable  purposes,  and  the  legislature  has  exercised 
this  power  by  general  law  exempting  such  property. 

The  trial  court  held  against  the  Society  on  all  points  and  the  ease 
was  appealed  to  the  Supreme  Court  where,  in  the  opinion  handed 
down,  the  first  contention  above  mentioned  was  not  sustained,  and 
on  this  ]wint  the  Court  used  the  following  lanixuage: 


THli)    STATE    OF    NEBRASKA  G51 

"A  Fraternal  Beneficiary  Association,  conducted  for  the  mutual 
benefit  of  its  members  and  for  the  purpose  of  providing  a  fund  by 
the  payment  of  stated  dues  and  fees  from  sudi  mcndjers  for  the 
payment  of  a  special  amount  upon  the  death  of  each  member  to  a 
beneficiary  named  by  him,  is  not  a  charitable  association,  and  its 
funds  are  not  used  exclusively  for  charitable  purposes,  so  as  to  ex- 
empt them  from  taxation  by  the  laws  of  this  State." 

It  was  further  held  that  the  question  must  be  determined,  not  b.y 
wliat  the  association  i)rofesses  to  be.  but  by  what  it  really  is,  and 
the  nature  of  the  business  it  conducts;  that  tlie  general  trend  of 
judicial  opinion  of  tliis  country  is  that  corporations,  like  appellant, 
are,  in  effect,  mutual  insurance  companies.  The  Coiu't  then  follows 
willi  a  statement  of  the  organization  and  purjioses  of  appellant, 
which  are  the  same  as  those  usually  declared  by  frHtcrnal  societies, 
and  further  says  in  the  opinion,  that, 

"All  of  these  purposes  are  confined  to  its  members  and  ai-e  de- 
jiendent  upon  the  payment  by  them  of  the  assessments  required  by 
the  by-laws.  Beneficiary  members  get  what  is  p;iid  for  and  nothing 
UKirc.  If  they  cease  to  pay,  they  cease  to  receive.  Members  con- 
tinued to  pay  for  the  benefit  of  another,  not  because  of  any  chari- 
table or  benevolent  impulse,  but  because  they  expect  upon  their 
death  that  those  whom  they  are  interested  in  or  bound  by  law  or  ties 
of  affection,  to  provide  for,  will  receive  the  amount  which  it  is  agreed 
in  the  beneficiary  certificate  will  be  paid  by  the  association  to  such 
beneficiary.  This  is  not  charity  nor  benevolence.  Pa.vment  to  the 
beiu'ficiary  does  not  depend  upon  his  or  her  financial  condition.  A 
wealthy  child  or  widow  of  the  assured  member  would  be  entitled 
to  claim  the  amount  named  in  his  certificate,  equally  with  one  poor 
or  needy.  This  benefit  is  ])aid  because  of  so  inuch  mimcy  and  so 
many  assessments  paid  by  the  assured  member.  This  benevolence  or 
charity  is  purely  of  a  commercial  character.  It  does  not  seek  out 
the  needy,  but  invites  only  the  able  bodied  and  healthy.  It  is  a 
business  arrangement  and  the  beneficiary  receives  payment  because 
of  a  contract  obligation  on  the  part  of  the  association  to  make  such 
payment. ' ' 

The  Court  sustained  the  second  contention, iianu^ly  that  the  Society 
was  entitled  to  set  off  the  amount  of  its  outstanding  benefit  certlfi- 


•^; 


I 


652  FRATERNAL    SOCIETY    LAW 

cates,  matured  and  unmatured,  against  its  fidelity  fir  iiKirtiiai-y  fund. 
The  revenue  statute  of  Nebraska,  which  is  much  lilvc  that  of  many 
states  provides  that  "'the  taxpayer  may  deduct  from  his  gross 
credits  the  amount  of  his  bona  fide  debts  in  order  to  determine  the 
true  value  of  his  credits  for  assessment."  The  State  insisted  that 
the  mortuary  fund  of  the  Society  was  money  loaned  and  invested, 
and  therefore  must  be  taxed.  Answering  this  contention,  the  Court 
said: 

"Money  loaned  or  invested  Avithin  the  ordinary  meaning  of  the 
term  is  money  or  ca'pital  laid  out,  with  a  view  of  obtaining  a  profit 
or  income  therefrom.  The  fact  that  the  fund  in  question  has  as- 
sumed the  form  of  bonds,  mortgages  or  other  securities,  does  not  of 
itself  fix  its  nature  or  determine  its  use.  It  is  the  use  to  which  it  is 
put,  that  determines  its  character;  that  this  fund  is  not  loaned  or 
invested  for  profit  within  the  ordinary  meaning  of  the  term,  seems 
clear.  The  fidelity  or  mortuary  fund  of  the  association  is  set  apart 
by  its  by-laws  and  the  laws  of  this  State,  as  a  trust  fund  for  the 
payment  of  its  beneficiary  certificates.  This  fund  must  be  kept  and 
conserved  for  that  particular  purpose,  and  no  other,"  the  Court 
cites  Equitable  Life  Insurance  Company  vs.  Board  of  Equalization, 
74th  Iowa,  178,  37  N.  W.  141.  in  which  it  was  said  that  the  statute 
recognizes  the  existence  of  a  debt  from  the  company  to  the  policy 
holders  and  provides  for  securing  its  payments  through  the  reserve 
fimd,  and  the  aggregate  amount  of  such  indebtedness  should  be 
deducted  from  the  reserve  fund,  and  the  balance,  if  any,  be  sub.iect 
to  taxes;  also  ]\Iicliiiian  IMutual  Life  Insurance  Company  vs.  Com- 
mon Council  of  the  city  of  Detroit.  95  N.  W.  1131,  involving  the 
question  of  the  right  of  a  Mutual  Life  Insurance  Company,  organized 
for  profit  under  a  revenue  statute,  practically  like  that  of  Nebraska, 
to  set  off  its  reserve  fund  credits  against  its  mortuary  debts,  in  which 
it  was  held  that  it  has  the  right  to  deduct  the  amount  of  its  policies 
from  its  premium  reserve,  and  concludes : 

"That  the  reserve  fund  of  the  company  represents  its  indebtedness 
to  its  policy  holders,  and  should  be  exempt  from  taxation." 

It  was  contended  by  the  State  that  the  case  of  the  Michigan 
Mutual  Life  Insurance  Company  vs.  Common  Council  of  the  city  of 
Detroit,  supra,  and  E(|uitablo  Life  [nsurance  Couipaiiy  vs.  Board  of 


THE    STATE    OF   NEBRASKA  653 

Equalization,  supra,  and  Gold  Insurance  Co.  vs.  fjott,  54  Ala.  499, 
furnished  no  authority  for  the  determination  of  the  question  in  the 
case  at  bar,  and  that  the  doctrine  of  those  cases  applied  only  to  old 
line  life  insurance  companies,  the  jjolicies  of  which  have  a  ]>rpsent 
surrender  value.     In  respect  to  these  questions,  the  Court  said: 

"It  is  difficult  to  understaiul  why  old  line  iiisurauec  cduipanies, 
which  are  organized  for  the  purjiose  of  j^ain  anil  profit,  should  be 
accorded  the  privilege  of  the  set  olf,  and  tiiat  I'ight  denied  to  bene- 
ficiary associations,  which  are  organized  solely  for  the  ])urpose  of 
conserving  the  interest  of  their  members,  and  are  prohibited  by  law 
from  being  conducted  for  the  purpose  of  gain.  *  *  *  We  are  of  the 
opinion  that  the  certificates  create  a  bona  fide  debt,  payable  out  of 
the  particular  credit  or  fund,  known  as  the  fidelity  or  mortuary 
fund  of  the  association,  and  may,  for  tin-  purpose  of  taxation,  be 
set  oft'  against  the  securities  in  such  fu7id."' 

The  Court  held  that  all  of  the  funds  and  property  of  the  associa- 
tion that  have  not  been  segregated  and  become  a  part  of  the  mortu- 
ary fund  are  taxable,  meaning  that  the  expense  or'general  fund,  fur- 
niture, fixtures  and  supplies  and  all  property  except  that  designated 
as  mortuary  fund  was  taxable  but  that  the  reserve  or  mortuary-  fund, 
in  whatever  form,  was  exempt  from  taxation. 

In  re  taxation  of  the  Royal  Highlanders.  .June  20,  1906,  108  N.  W. 
183.  Upon  the  question  presented  iu  the  foregoing  citation,  see 
also  State  ex  rel.  vs.  Drexel,  107  N.  W.  110;  Modern  Fraternal 
Order  vs.  Board  of  Review,  223  111.  54. 

Forfeiture — Notice  of  Assessments. 

Although  a  by-law  of  a  society  requires  the  clerk  of  a  local  lodge 
to  notify  the  members  of  their  liability  for  assessments,  his  failure 
so  to  do  will  not  prevent  a  forfeiture  for  non-payment,  if  another 
by-law  expressly  provides  that  such  failure  shall  have  that  effect. 

Chappie  vs.  Sovereign  Camp  Woodmen  of  the  World,  February,  1902. 
64  Nebr.  55. 

Forfeiture— Waivers  of  Laws  Not  Favored. 

When  the  by-laws  of  a  society  expressly  declare  that  the  fact  of 


654  FRATERNAL     SOCIETY    LAW 

delinquency  iu  jiayment  of  assessments  shall  work  a  forfeiture  of 
membership,  i\nd  that  thereafter  the  delinquent  member  shall  not 
be  entitled  to  receive  the  pass  word,  or  to  participate  in  any  of  the 
business  or  social  proceedings  of  his  camp,  except  that  he  may  be 
admitted  to  a  meeting  to  pay  his  arrearages,  when  he  must  retire, 
if  he  does  not  pay  same,  such  forfeiture  is  not  waived  by  the  mere 
fact  that  the  member  was  present  at  all  of  the  meetings  and  par- 
ticipated in  the  proceedings  of  his  local  camp  up  to  the  time  of  his 
death,  which  occurred  snon  after  he  became  delinquent. 

Chappie  vs.  Sovereign  Camp  Woodmen  of  the  World,  February,  1902, 
64  Nebr.  55. 

By-Laws,  Agency — Waivers  by  Local  Officials. 

It  is  a  settled  law  of  this  State  that  if  a  society  receives  dues  and 
mortuary  assessments  from  n  member  who  has  forfeited  his  certifi- 
cate, after  notice  of  such  forfeiture  by  its  officers  or  those  intrusted 
with  the  duty  of  making  assessments,  it  shall  be  held  to  have  waived 
such  forfeiture,  without  regard  to  any  restrictions  or  limitations 
incorporated  iu  its  certificates  or  bj^-laws  with  respect  to  the  power 
or  authority  of  such  persons  to  make  such  waivers. 

Modern    Woodmen   of   America   vs.   Colman,   March,   1902,   64   Nebr. 
162. 

Forfeiture — Self-executing  Provisions. 

By-laws  of  a  societ\'  providing  for  the  payment  of  assessments 
made  during  the  month  on  a  certain  day,  and  for  suspension  without 
notice  of  members  in  default,  are  self-executing,  and  the  suspended 
member  is  not  entitled  to  notice. 

Field  vs.  National  Council  Knights  and  Ladies  of  Security.  March, 
1902,  64  Nebr.  226. 

Agency — Local  Official  Cannot  Waive  Laws. 

The  iinancial  secretaiy  of  a  local  council  lias  no  implied  authority 


THE    STATE    OF    NEBRASKA  655 

to  waive  any  oT  llir  provisidiis  oh'  the  by-laws  gov<'fning  the  payment 
of  assessments. 

Field   vs.   National   Council   Knights  and  Ladies  of  Security.   March, 
1902,  G4  Nebr.  226. 

Contract — What  Composes. 

The  laws  of  the  State,  articles  of  incorporation,  by-laws  of  the 
society,  application  for  membership,  and  certificate  of  membership 
constitute  the  contract  between  the  society  and  its  members. 

Farmers  Mutual  Insurance  Co.  vs.  Kinney,  May,  1902,  64  Nebr.  808. 

After-enacted  Laws  Binding. 

Where  members  have  agreed  in  their  applications  to  be  governed 
by  all  by-laws  and  rules  "now  in  force  or  hereafter  adopted,"  they 
will  be  bound  by  all  subsequently  enacted  by-laws  the  same  as  by 
those  in  force  at  the  time  the  certificate  was  issued. 

Farmers  Mutual  Insurance  Co.  vs.  Kinney,  May,  1902,  64  Nebr.  808. 

Forfeiture  Under  After-enacted  Laws  Valid. 

A  by-law  which  provides  that  the  society  shall  not  be  liable  for 
any  loss  that  may  occur  while  the  member  is  in  default  in  the  pay- 
ment of  legal  assessments,  which  by-law  was  adopted  subsequent 
to  the  issuance  of  the  certificate,  is  a  reasonable  by-law,  and  became 
a  part  of  the  member's  contract. 

Farmers  Mutual  Insurance  Co.  vs.  Kinney,  May.  ly02.  64  Nebr.  808. 

Evidence,  Coroner's  Report  Not  Admissible. 

A  coroner's  report,  wherein  he  states  what  appeared  to  him  to  be 
the  cause  of  death  of  the  member  was  held  not  admissible  in  evi- 
dence; but  in  this  case  no  coroner's  jury  had  been  called,  because 
the  coroner  apparently  deemed  it  unnecessary.  He  was  a  physician 
and  surgeon,  and  was  called  as  a  witness  for  the  defendant,  and  was 


656  FRATERNAL   SOCIETY   LAW 

present  at  the  trial  and  testified  to  the  facts  that  he  observed  rela- 
ting to  the  cause  of  death. 

Kinney  vs.  Brotherhood  of  American  Yeomen,  December,  1905,  Su- 
preme Court  of  North  Dakota,  106  N.  W.  44. 

Evidence — When  Physician's  Opinion  Admissible. 

The  opinion  of  a  physician  as  to  the  cause  of  death  of  a  member  is 
not  admissible,  unless  the  facts  upon  which  the  opinion  is  based  are 
in  evidence. 

Kinney  vs.  Brotherhood  of  American  Yeomen,   December,  1905,  Su- 
preme Court  of  North  Daltota,  106  N.  W.  44. 


THE    STATE    OF    NEVADA  657 


THE 

STATE   OF   NEVADA. 

CHAPTER  29. 

The  State  of  Nevada  has  never  enacted  a  fraternal  society  code. 
Section  956  of  the  Compiled  Laws  of  Nevada  in  a  chapter  upon  In- 
surance Corporations  reads  a.s  follows  :  ' '  The  provisions  of  this  act 
shall  not  apply  to  secret  or  fraternal  societies,  lodges,  or  councils 
wliieh  conduct  their  business  and  secure  membership  on  the  lodge 
system  exclusively,  having  ritualistic  work  and  ceremonies  in  their 
societies,  lodges,  or  councils,  nor  to  any  mutual  or  benefit  association 
organized  or  formed  and  composed  only  of  members  of  any  such 
society,  lodge,  or  council  exclusively."  The  legislature  at  its  20th 
session  j)assed  an  act  relating  to  the  regulation  of  the  insurance  busi- 
ness in  the  State  which  act  became  a  law  March  29tli,  1901,  wherein 
insurance  concerns  were  required  to  obtain  annually  a  license  to  do 
business  in  the  State  and  to  pay  certain  fees,  and  provided  for  pen- 
alties for  failure  or  neglect  to  comply  with  the  provisions  of  the 
act,  but  the  act  contained  the  following  proviso:  "Provided,  how- 
ever, that  nothing  contained  in  this  act  shall  be  construed  to  apply 
to  any  fraternal  secret  society  organized  in  this  State,  or  working  or 
being  subordinate  to  a  supreme  lodge  of  a  secret  society  organized 
imder  the  laws  of  another  State,  or  to  prevent  the  same  from  issuing 
benefits  to  its  members." 

The  legislature  by  act  approved  by  the  governor  on  March  29, 
1907,  passed  an  act  in  relation  to  interpleader ;  a  portion  of  the  same 
being  germane  to  the  business  of  fraternal  societies  is  as  follows: 
"Whenever  conflicting  claims  are  or  may  be  binding  upon  a  person 
for  or  relating  to  personal  property  or  thr  jierformance  of  an  obliga- 
42 


658  FRATERNAL    SOCIETY    LAW 

tion  or  any  poi'tion  thereof,  such  person  may  bring  an  action  against 
the  eoutiicting  claimants  and  comijel  them  to  interplead  and  litigate 
their  several  claims  among  themselves.  The  order  ni'  substitution 
may  be  made,  and  applicant  or  plaintiff  be  discharged  from  liability 
to  all  or  any  of  the  conflicting  claimants  although  their  titles  or 
claims  have  not  a  common  origin,  or  are  not  identical,  but  are  ad- 
verse to  and  independent  of  one  another." 

Section  1  Chapter  CLXVIII  Statutes  of  Nevada,  1907. 

Contracts — Construction  of  Doubtful  Language. 

If  on  the  face  of  a  contract  of  insurance  there  is  in  the  language 
used,  or  its  ei¥ect,  any  room  for  construction  or  doubt,  the  benefit  of 
the  doubt  must  be  given  to  the  assured,  and  in  the  construction  of 
contracts  of  insurance  such  meaning  should  be  given  to  the  language 
employed  as  plain  people  usually  attach  to  it. 

Gerhauser  vs.  North  British  &  Mer.  Co.,  Octoher,  1871,  7  Nev.  174. 

Representations,  Materiality  for  Jury. 

The  question  whether  the  representations  made  by  the  applicant 
for  insurance  are  materially  untrue,  or  ttntrue  in  some  particular 
material  to  the  risk,  is  a  question  of  fact  for  the  jury. 

Gerhauser  vs.  North  British  &  Mer.  Co.,  October,  1871,  7  Nev.  174. 

Warranty — Materiality  May  be  Fixed  by  Contract. 

Parties  to  a  contract  of  insurance  ma.v  decide  for  themselves  what 
facts  or  representations  shall  be  deemed  material  and  stipulate  as  to 
their  materiality,  and  when  they  have  so  agreed,  the  agreement 
precludes  all  inquiry  upon  the  subject. 

Gerhauser  vs.  North  British  &  Mer.  Co.,  October,  1871,  7  Nev.  174. 

Warranty  and  Misrepresentation — No  Extension  by  Construction. 

As  a  warrant.v  will  not  be  created  or  extenilcd  by  constiMiction  or 


i^ 


THE    ^TATL'    OF    XEVADA  (;5<) 

implication,  so  the  iuteiition  of  the  iiaiiics  U>  ;iii  insiii-niici'  contract 
to  conclude  by  convention  the  question  of  the  in;ili'ri;il ity  of  a  rep- 
resentation should  be  clearly  manifested,  and  in  ease  of  doubt,  the 
doubt  is  to  be  resolved  in  favor  of  the  insured.  Though  as  an  or- 
dinary rule  written  contracts  cannot  be  controlled  by  or  extended 
by  cotemporaneous  statements  nul  <Mnlirae<'d  in  the  writing,  in  a 
case  of  a  contract  of  insurance  a  recovery  may  be  prevented  by  proof 
of  verbal  misrepresentations,  which  were  indueive,  and  were  ma- 
terial to  the  risk,  but  the  burden  of  i)roof  is  on  the  defendant  to 
show  the  raisrepresen-tation.  and  that  it  was  material. 

Gerhauser  vs.  North  Britisli  &  Mer.  Co..  Octol)er.  1871.  7  Nev.  174. 


660  FRATERNAL    SOCIETY    LAW 


THE 

STATE   OF   ^EW    HAMPSHIRE. 

CHAPTER  30. 

(Chapter  86  of  Statutes  aud  Sections  as  therein  uuinbered.) 

Section  1.  A  fraternal  beneficiary  association  is  hereby  declared 
to  be  a  corporation,  societ^y  or  voluntary  association  formed  or  or- 
ganized and  carried  on  for  the  sole  benefit  of  its  members  and 
beneficiaries,  and  not  for  profit.  Each  association  shall  have  a 
lodge  system,  with  ritualistic  form  o|  work  and  representative 
form  of  government,  and  may  make  provisions  for  the  payment 
of  benefits  to  members  and  their  beneficiaries  in  ease  of  death,  sick- 
ness, temporary  or  permanent  physical  disability,  either  as  the  re- 
sult of  disease,  accident  or  old  age.  The  fund  from  which  the 
payment  of  such  benefit  shall  be  made,  and  the  fund  from  which  the 
expenses  of  such  association  shall  be  defrayed,  shall  be  derived  from 
assessments  or  dues  collected  from  its  members.  Payment  of  death 
benefits  shall  be  to  the  families,  heirs,  blood  relatives,  affianced  hus- 
band or  affianced  wife,  or  to  persons  dependent  on  the  member. 
Such  associations  shall  be  governed  by  this  act,  and  shall  be  sub- 
ject to  the  provisions  of  the  insurance  laws  of  this  State  consistent 
with  the  provisions  of  this  act,  and  no  law  hereafter  passed  shall 
apply  to  them  unless  they  be  expressly  designated  therein. 

Section  2.  All  such  associations  coming  within  the  description 
as  set  forth  in  section  1  of  this  act,  organized  under  the  laws  of 
this  or  any  other  State,  province  or  territory,  and  now  doing  busi- 
ness in  this  State,  may  continiie  such  business  if  the  commissioner 
of  insurance  is  satisfied  that  such  associations  are  reliable  and  worthv 


THE    HTATI'J    OF    NEW    HAMPSHIRE  661 

of  public  patronage;  provided,  that  iln^-y  licrcul'tei-  comply  willi  tliu 
jn'ovisions  of  this  act  regulating  the  annual  reports,  and  tlie  desig- 

ii.'ilioii   ol'  111 iiiinissioiii'i'  of  insiiniiu-r  ;is  llir   |)crson   upon   wiioiii 

pi-occss  may  be  served,  as  liei'einai'ter  ])l'ovi(li'(l. 

Section  iJ.  Any  such  association  coming  witiiin  tin-  descriiition 
as  set  forth  in  section  1  of  this  act,  organized  luidi-r  the  laws  of 
any  oilier  .State,  province  or  territory,  and  not  now  doing  business 
ill  this  State,  shall  be  admitted  to  do  business  within  the  State, 
if  the  commissioner  of  insurance  is  satisfied  that  such  association 
is  reliabli'  ;md  worthy  of  piiblii'  patronage,  and  when  it  shall  have 
fili'd  with  the  commissioner  of  insurance  a  duly  certified  copy  of 
its  charter  and  articles  of  association,  and  a  copy  of  its  consti- 
tution or  laws,  certified  to  by  its  secretary  or  corresponding  officer, 
together  with  an  appointment  of  the  commissioner  of  insurance  of 
this  State  as  a  person  upon  whom  process  may  be  served  as  here- 
inafter provided,  and  provided  that  such  association  shall  be  shown 
by  certificate  to  be  authorized  to  do  business  in  the  State,  province 
or  tei'i'itory  in  which  it  is  incorporated  or  organized,  in  case  the 
laws  of  such  State,  province  or  territory  shall  provide  for  such  au- 
thorizatiim ;  and  in  case  the  laws  of  such  State,  province  or  terri- 
toi-y  ilo  not  jn-ovide  for  any  formal  authorization  to  do  Inisiness 
on  the  part  of  any  such  association,  then  such  association  shall 
be  shown  to  be  conducting  its  business  in  accordance  with  the  pro- 
visions of  this  act,  for  which  purpose  the  commissioner  of  insurance 
of  this  State  may  personally,  or  by  some  person  to  be  designated  by 
him.  examine  into  the  condition,  affairs,  character,  and  business 
methods,  aceoimts,  books,  and  investments  of  such  association  at 
its  home  office,  which  examination  shall  be  at  the  expense  of  such 
association,  and  shall  be  made  within  thirt>-  days  after  demand  there- 
for, and  the  expense  of  such  examination  shall  be  limited  to  $5 
per   diem   and   expenses. 

Section  4.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and 
file  with  the  commissioner  of  insurance  of  this  State,  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  thirty-first 
day  of  December  immediately  preceding,  which  annual  report  shall 
be  in  lieu  of  all   other  reports  required  by  any   other  law.     Such 


662  FRATERNAL    SOCIETY    LAW 

reports  shall  be  upon  blank  forms  to  be  provided  by  the  commis- 
sioner of  insurance,  or  may  be  printed  in  pamphlet  form,  and  shall 
be  verified  under  oath  by  the  duly  authorized  officers  of  such  asso- 
ciation, and  shall  be  published,  or  the  substance  thereof,  in  the 
annual  report  of  the  commissioner  of  insurance  under  a  separate 
part  entitled  "Fraternal  beneficiary  associations,"  and  shall  contain 
answers  to  the  following  questions: 

1.  Number  of  certificates  issued  during  the  year,  or  members  ad- 
mitted. 

2.  Amount  of  indemuitj'  afi'ected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representatives 
or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and  brief 
statement  of  reasons. 

9.  Does  association  charge  annual  or  other  pei'iodical  dues  or 
admission  fees? 

10.  How  much  on  each  one  thousand  dollars  annually  or  per 
capita,  as  the  case  may  be? 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officei's. 

13.  Does  association  guarantee,  in  its  certificates,  fixed  amounts 
to  be  paid  regardless  of  amount  realized  from  assessments,  dues, 
admission  fees,  and  donations? 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  .such  guar- 
anty. 

15.  Has  the  association  a  reserve  fund? 

16.  If  so.  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested? 

17.  Plas  the  association  more  than  one  class? 

18.  If  so,  how  many,  and  the  amount  of  indemnity  in  each? 

19.  Xunilier  of  momlx'rs  in  each  class? 


THE    STATE    OF    NEW    HAM  PS  II I  HE  663 

20.  ir  vohuitary,  so  state,   and  give  date  uf  or^ani/ation. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time,  giving  chapter  and  .vear  and  date  of  passage 
of  the  act? 

22.  If  organized  under  the  laws  of  anj^  other  State,  province  or 
territory,  state  such  fact  and  the  date  of  organization,  giving  chap- 
ter and  year  and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  beneficiary  membership  lapsed 
during  the  year. 

24.  Namber  in  force  at  beginning  and  cud  of  yeai';  if  move  than 
one  class,  number  in  each  class. 

25.  Names  and  addresses  of  its  president,  secretary,  and  treas- 
urer, or  corresponding  officers. 

The  commissioner  of  insurance  is  authorized  and  empowered  to 
address  any  additional  incpiiries  to  any  such  association  in  relation 
to  its  doings  or  condition,  or  any  other  matter  connected  with  its 
transactions  relative  to  the  business  contemplated  by  this  act;  and 
such  officers  of  such  association  as  the  commissioner  of  insurance 
may  require  shall  promptly  reply  in  writing,  under  oath,  to  all  such 
inquiries. 

Section  5.  Each  such  association  now  doing  or  hereafter  admitted 
to  do  business  within  this  State,  and  not  having  its  principal  office 
within  this  State,  and  not  being  organized  under  the  laws  of  this 
State,  shall  appoint  in  writing  the  commissioner  of  insurance  or  his 
successor  in  office  to  be  its  true  and  hnvful  attorney,  upon  whom  all 
lawful  process  in  any  action  or  proceeding  against  it  may  be  served 
and  in  such  writing  shall  agree  that  any  lawful  process  against  it 
which  is  served  on  said  attornej^  shall  be  of  the  same  legal  force 
and  validity  as  if  served  upon  the  association,  and  that  the  author- 
ity shall  continue  in  force  so  long  as  any  liability  remains  out- 
standing in  this  State.  Copies  of  such  certificate,  certified  by  said 
commissioner  of  insurance,  shall  be  deemed  sufficient  evidence 
thereof,  and  shall  be  admitted  in  evidence  with  the  same  force  and 
efi:'ect  as  the  original  thereof  might  be  admitted.  Service  upon 
such  attorney  shall  be  deemed  sufficient  service  upon  such  associ- 
ation. When  legal  process  against  any  such  association  is  served 
upon  said  commissioner  of  insurance,  he  shall  immediately  notify 


6(ji  FRATERNAL    SOCIETY    LAW 

the  association  of  such  service  by  letter,  prepaid  and  directed  to 
its  seeretar.y  or  corresponding  officer,  and  shall  within  two  days 
after  such  service  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him  to  such  officer.  The  plaintiff  in  such  process  so 
served  shall  paj'  to  the  commissioner  of  insurance  at  the  time  of  such 
service  a  fee  of  three  dollars,  which  shall  be  recovered  by  him  as 
part  of  the  taxable  costs  if  he  prevails  in  the  suit.  The  commis- 
sioner of  insurance  shall  keep  a  record  of  all  processes  served  upon 
him.  which  record  shall  show  the  day  and  hour  when  such  service 
was  made. 

Section  6.  The  commissioner  of  insurance  of  this  State  shall,  upon 
the  application  of  any  association  having  the  right  to  do  business 
within  this  State  as  provided  by  this  act.  issue  to  such  association 
a  permit  in  writing  authorizing  such  association  to  do  business  within 
this  State,  for  which  certificate  and  all  proceedings  in  connection 
therewith  such  association  shall  pay  to  said  commissioner  a  fee 
of  five  dollars. 

Section  7.  Existing  associations  may  re-incorporate  themselves,  at 
their  option,  under  this  act.  and  any  new  association  may  organize 
under  its  provisions,  but  no  certificate  of  incorporation  shall  issue 
until  the  association  has  submitted  to  the  insurance  commissioner 
their  constitution,  by-laws,  and  a  statement  of  their  proposed  meth- 
ods, and  they  have  been  by  him  approved. 

Section  8.  Such  association  shall  not  employ  paid  agents  in  so- 
liciting or  procuring  members,  except  in  the  organizing  or  building 
up  of  subordinate  bodies  or  granting  members  inducements  to  jiro- 
cure  new  members. 

Section  9.  No  contract  with  any  other  association  shall  be  valid 
when  there  is  a  contract,  agreement  or  under.standing  between  the 
meml)er  and  the  beneficiary  that  the  beneficiary  or  any  person  for 
him  shall  pay  such  member's  assessments  and  dues,  or  either  of  them. 

Section  10.  The  money  or  other  beneiit.  charity,  relief  or  aid 
to  be  paid,  provided  or  rendered  by  an  association  authorized  to  do 
business  under  this  act  shall  not  be  liable  to  attachment  by  trus- 
tee, garnislii'c  or  other  i)rocess.  and  shall  not  be  seized,  taken,  ap- 
])i-(i|iriated  or  applied  by  any  leyal  or  equitable  pi'ocess  or  bj-  oper- 
alion  of  law.  to  pny  any  di'lil  or  li;ibilily  of  a  certificate-holder,  or  of 


THE    STATE    OF    NEW    HAMPSHIRE  6G5 

iijiy  beneficiary  named  in  a  certificate,  or  of  any  person  who  maj' 
have  any  right  thereunder. 

Section  11.  Any  such  association  organized  under  the  laws  of 
this  State  may  provide  for  the  meetings  of  its  legislative  or  gov- 
erning body  in  any  other  State,  province  or  territory  wherein  such 
association  shall  have;  subordinate  bodies,  and  all  business  transacted 
at  such  meetings  shall  be  valid  in  all  respects  as  if  such  meetings 
were  held  within  this  State;  and  where  the  laws  of  any  such  asso- 
ciation provide  for  the  election  of  its  officers  by  votes  to  be  cast  in 
its  subordinate  bodies,  the  votes  so  east  in  its  subordinate  bodies 
in  any  other  State,  province  or  territory  shall  be  valid,  as  if  cast 
within  this  State. 

Section  12.  Any  person,  officer,  member  or  examining  physician, 
who  shall  knowingly  or  willfully  make  any  false  or  fraudulent  state- 
ment or  representation  in  or  with  reference  to  any  application  for 
membership,  or  for  the  purpose  of  obtaining  anj^  money  or  benefit 
in  any  association  transacting  business  under  this  act,  shall  be 
guilty  of  misdemeanor,  and  upon  conviction  shall  be  punished  by 
a  fine  of  not  less  than  sf^lOO  nor  more  than  $500,  or  imprisonment 
in  the  county  jail  for  not  less  than  thirty  days  nor  more  than 
one  year,  or  both,  in  the  discretion  of  the  court ;  and  any  pers(Ui 
who  shall  willfully  uuike  a  false  statement  of  any  material  fact  or 
thing  in  a  sworn  statement  as  to  the  death  or  disability  of  a  cer- 
tificate-holder in  any  such  association  for  the  purpose  of  procuring 
payment  of  a  benefit  named  in  the  certificate  of  such  holder,  and 
any  person  who  shall  willfully  make  any  false  statement  in  any 
verified  report  or  declaration  under  oath  required  or  authorized 
by  this  act,  shall  be  guilty  of  perjury,  and  shall  be  proceeded  against 
and  punished  as  provided  by  the  statutes  of  this  State  in  relation 
to  the  crime   of'  perjury. 

Section  13.  Any  such  association  refusing  or  neglecting  to  make 
the  report  as  provided  in  this  aet  shall  be  excluded  from  doing  busi- 
ness within  this  State.  Said  commissioner  must,  within  sixty  days 
after  failure  to  make  such  report,  or  in  case  any  such  association 
shall  exceed  its  powers  or  shall  conduct  its  business  fraudulently,  or 
shall  fail  to  comply  with  any  of  the  provisions  of  this  act.  give  notice 
in  writing  to  the  attorney-general,  who  shall  immediately  commence 


666  FRATERNAL    SOCIETY    LAW 

ao  action  against  such  association  to  enjoin  the  same  from  carrying 
on  any  business;  and  no  injunction  against  any  such  association  shall 
be  granted  by  any  court,  except  on  application  by  the  attorney- 
general  at  the  request  of  the  commissioner  of  insurance.  No  asso- 
ciation so  enjoined  shall  have  authority  to  continue  business  until 
such  report  shall  be  made  or  overt  act  or  violations  complained  of 
shall  have  been  corrected,  nor  until  the  costs  of  such  action  be  paid 
by  it,  provided  the  court  shall  find  that  such  association  was  in  de- 
fault as  charged,  whereupon  the  commissioner  of  insurance  shall 
reinstate  such  association ;  and  not  until  then  shall  such  association 
be  allowed  to  again  do  business  in  this  State.  Any  officer,  agent 
or  person  acting  for  any  association  or  subordinate  body  thereof 
within  this  State  while  such  association  shall  be  so  enjoined  or 
prohibited  from  doing  business  pursuant  to  this  act,  shall  be  deemed 
guilty  of  a  misdemeanor,  and  on  conviction  thereof  shall  be  pun- 
ished by  a  fine  not  less  than  $25  nor  more  than  $200,  or  by  imprison- 
ment in  the  county  jail  not  less  than  thirty  days  nor  more  than 
one  year,  or  by  both  such  fine  and  imprisonment,  in  the  discretion 
of  the  coui't. 

Section  1-1.  Any  person  who  shall  act  within  this  State  as  an 
officer,  agent  or  otherwise,  for  any  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with  or  shall  have  violated 
any  of  the  provisions  of  this  act,  or  shall  have  failed  or  neglected 
to  prociu'e  from  the  commissioner  of  insurance  proper  certificate  of 
authority  to  transact  business  as  provided  for  by  this  act,  shall 
be  subject  to  the  penalty  provided  in  the  la-st  preceding  section  for 
the  misdemeanor  therein  specified. 

Section  15.  All  acts  and  parts  of  acts  inconsistent  with  the  ]U'0- 
visions  of  this  act  are  hereby  repealed;  but  nothing  herein  con- 
tained shall  apply  to  or  in  anyway  intei-fere  with  ilasonic.  Odd 
Fellow,  Knights  of  Pythias,  Red  Men  or  other  similar  orders,  or 
any  association  working  in  the  lodge  system  which  limits  its  cer- 
tificate-holders to  a  particular  class,  or  to  the  employees  of  any 
firm,  or  municipal  or  other  corporation,  or  to  corporations  or  asso- 
ciations insuring  only  members  of  some  particular  order,  sect,  pro- 
fession or  trade. 

The  following  general  i)rovisions  of  the  Insurance  Statutes  of 
New  Hampshire  are  proper  to  be  included  here : 


THE    STATE    OF    NEW    HAMPSHIRE  (J(i7 

An  Act  Relating-  to  the  Provisions  of  Life  Insurance  Policies. 

lie  it  eiiaL'tcd  \>y  llif  Sciuitc  and  House  of  Representatives  in  Gen- 
eral  Coui't   convened: 

Sectiiiii  1.  Kvery  |i(ilicy  o['  insurance  issued  oi-  delivered  within 
this  State  on  or  after  tiie  first  day  of  January,  nineteen  linndred 
aiul  eig'ht,  by  any  life  insurance  corporation  doiny  Inisiness  within 
the  State  shall  contain  the  entire  contract  Ijetween  the  parties. 

Section  2.  All  acts  ami  parts  of  acts  inconsistent  with  the  pro- 
visions of  this  act  are  hereby  repealed. 

Section  3.  This  act  shall  take  effect  and  be  in  force  from  and  after 
its  passage. 

.\pproved  April  'A.  1907. 

An  Act  Regulating-  Life  Insurance  Companies  and  prohibiting  the 
diversion  of  funds  for  political  purposes. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  in  Gen- 
eral Court  convened : 

Section  1.  No  insurance  company  or  association  including  fra- 
ternal beneficiary  associations,  doing  business  in  this  State  shall, 
directly  or  indirectly,  pay  or  use  or  offer,  consent  or  agree  to  pay 
01'  use  any  money  or  jiroperty  for  or  in  aid  of  any  political  party, 
committee  or  organization,  or  for  or  in  aid  of  any  corporation,  joint 
stock  or  other  association  organized  or  maintained  for  political  pur- 
poses or  for  or  in  aid  of  any  candidate  for  political  office,  or  for 
nomination  for  such  office,  or  for  any  political  purpose  whatsoever, 
or  for  the  reimbursement  or  indemnification  of  any  person  for  money 
or  property  so  used.  Any  officer,  director,  stockholder,  attorney  or 
agent  of  any  corporation  or  association  which  violates  any  of  the 
provisions  of  this  act,  who  participates  in.  aids,  abets,  or  advises  or 
consents  to  any  .such  violation,  and  any  i^erson  who  solicits  or  know- 
ingly receives  any^  money  or  property  in  violation  of  this  act,  shall  be 
guilty  of  a  misdemeanor  and  be  punished  by  imprisonment  for  not 
more  than  one  year  ai^d  a  fine  of  not  more  than  one  thousand 
dollars,  and  anv  officer  aiding  or  abetting  in  anv  contribution  made 


668  FRATERNAL    SOCIETY    LAW 

in  violation  of  this  act,  shall  be  liable  to  the  company  or  association 
for  the  amount  so  contributed. 

No  person  shall  be  excused  from  attending  and  testifying,  or 
producing  any  books,  papers  or  other  doeiiments  before  any  court 
or  magistrate,  upon  any  investigation,  proceeding  or  trial,  for  a 
violation  of  any  of  the  provisions  of  this  act,  upon  the  ground  or 
for  the  reason  that  the  testimony  or  evidence,  documentary  or  other- 
wise, required  of  him  may  tend  to  incriminate  or  degrade  him; 
but  no  person  shall  be  prosecuted  or  subjected  to  any  penalt}'  or 
forfeiture  for  or  on  account  of  any  transaction,  matter  or  thing 
concerning  which  he  may  so  testify  or  produce  evidence,  docu- 
mentary or  otherwise,  and  no  testimony  so  given  or  produced  shall 
be  used  against  him  upon  any  criminal  investigation  or  proceeding. 

Section  2.  All  acts  and  parts  of  acts  inconsistent  with  the  pro- 
visions of  this  act  are  hereby  repealed. 

Section  3.  This  act  shall  take  effect  and  be  in  force  from  and 
after  its  passage. 

Approved  April  -3.  1907. 

An  Act  placing-  Certain  Corporations,  Associations,  Societies,  and 
Orders  under  the  Jurisdiction  of  the  Insurance  Commissioner. 

(From  Laws  of  1891.) 

Section  1.  Every  corporation,  association,  society  or  order,  or- 
ganized under  the  laws  of  this  State,  which  issues  a  certificate  to 
or  makes  a  promise  or  agreement  with  its  members  whereby  any 
sum  of  money  or  other  benefit  is  to  become  due  or  payable  upon 
the  decease  of  a  member,  or  whereby  such  money  or  other  benefit 
is  to  become  due  or  payable  as  an  endowment  or  lifetime  benefit, 
or  an  investment  involving  tontine  or  survivorship  principles  for  the 
benefit  of  persisting  members,  shall  annually,  on  or  before  the  first 
day  of  March  in  each  year,  make  and  transmit  to  the  insurance 
commissioner  a  statement  under  oath  of  its  president  and  secre- 
tary, or  officers  corresponding  thereto,  by  whatever  name  they  may 
be  called,  showing  its  financial  standing,  the  amount  and  sources 
of  its  income,  and  the  amount  and  manner  of  its  disbursement  for 


THE    tiTATE    OF    NEW    HAMPHIIIKE  (j(i9 

tlic  year  rudiug  on  tlic  |ii-ccriliiiL;'  lliiiiy-tirst  day  nl'  Dcci'inlici-,  and 
shall  make  sneli  I'lirt  lici'  stati'inents  ol'  its  iiU'inlji'i'sliip  and  linancial 
transactions,  plans,  and  incthods  of  Inisiness  done  or  i)ro]>osed  to  be 
done,  as  said  commissioner  shall  deem  necessary  to  a  proper  exhibit 
of  its  business  and  standing',  in  accordance  with  blanks  to  be  fur- 
nished by  the  coniniissionrr  for  this  purjjose;  and  every  such  cor- 
poration, association,  society  or  order  heretofore  oi'yani/.ed  in  this 
State  shall  file  with  said  commissioner  a  full  statement  as  above 
nMiuifcd  within  thirty  days  after  the  passage  of  this  act,  and  any 
such  coi'poratidn.  association,  society  or  order  hereafter-  organized  in 
this  State  shall,  before  doing  any  business,  tile  with  the  commis- 
sioner a.  eertitied  copy  of  its  charter  and  by-laws  and  a  full  state- 
iiieiit,  under  oath  of  its  president  and  secretary,  showing  the  finan- 
cial standing  of  the  corporation,  association,  society  or  order,  and 
explaining  fully  tlie  plans,  contracts,  and  methods  proposed  to  be 
used  in  the  prosecution  of  its  business.  Upon  receiving  such  state- 
ments, if  the  connnissicuier  is  satisfied  that  the  corporation,  asso- 
ciation, society  or  order  is  relialde  and  worthy  of  i)uhlic  patronage, 
he  shall  grant  a  license  authorizing  them  to  do  business.  sub.ject 
to  law.  until  the  first  day  of  April  thereafter:  and  annually  there- 
after on  the  first  day  of  April  such  license  may  be  renewed,  so  tong- 
as the  corporation,  association,  society  or  order  complies  with  the 
i-e(|uirements  aforesaid.  The  acting  officers  of  such  corporations, 
associations,  societies  or  orders  shall  be  liable  to  indietnu^nt  and 
subject  to  a  fine  not  exceeding  five  hundred  dollars  and  not  less 
than  fifty  dollars  for  violation  of  the  provisions  of  this  act.  This 
act  shall  not  be  construed  to  apply  to  any  benevolent  association 
which  pays  funei-al  and  sick  benefits  only. 

Section  2.  It  shall  be  the  duty  of  the  insurance  connnissioner. 
whenever  he  shall  have  reason  to  believe  that  any  such  corporation, 
association,  society  or  order,  organized  under  the  laws  of  this  State 
or  otherwise,  is  unsound,  or  conducting  its  affairs  contrary  to 
public  ])olicy.  or  ui)on  the  petition  of  five  or  more  jiolicy.  certificate, 
contract  or  bond  holders  of  any  such  corporation,  association,  society 
or  order,  setting  forth  that  they  believe  such  corporation,  association, 
society  or  order  unsomid.  or  that  there  is  waste  or  mismanagement 
in  the  affairs  of  such  eorp(U-ation,  association,  society  or  order,  or 


670  FRATERNAL    SOCIETY    LAW 

that  their  business  is  conducted  in  a  manner  contrary  to  public 
policy,  with  reason  for  such  belief,  to  make  personal  examination 
of  the  atfairs  of  such  eorj^oratiou,  association,  society  or  order,  at 
the  expense  of  the  corporation,  association,  society  or  order,  and 
for  such  purpose  he  shall  have  access  to  all  the  records,  books,  and 
papers  of  that  corporation,  association,  society  or  order,  and  may 
examine,  under  oath,  an.v  officer  or  agent  thereof.  If  upon  exami- 
nation the  commissioner  shall  be  of  the  opinion  that  the  affairs 
and  business  methods  of  the  corporation,  association,  society  or 
order  are  in  such  condition  as  to  render  it  unsafe  or  unworthy  of 
public  confidence,  he  shall  consult  the  attorney-general,  and,  with 
his  approval,  shall  file  a  petition  against  such  corporation,  asso- 
ciation, society  or  order,  in  the  office  of  the  supreme  court  of  the 
county  in  which  such  corporation,  association,  society  or  order  has 
its  principal  place  of  business,  for  closing  the  aft'airs  of  the  cor- 
poration, association,  soeietj^  or  order;  and  any  judge  of  said  court 
may  issue  a  temporary  injunction  to  restrain  such  corporation,  asso- 
ciation, societj'  or  order  from  doing  business,  which  shall  be  dis- 
solved or  made  permanent  by  said  court  upon  the  hearing  and 
determination  of  said  petition;  and  the  court  may  make  such  fur- 
ther orders  and  decrees  as  the  circumstances  of  the  ease  and  the 
protection  of  the  imblic  may  render  proper. 

Section  3.  It  shall  not  be  lawful  for  any  such  corporation,  asso- 
ciation, society  or  order,  organized  under  the  laws  of  this  State  or 
any  other  State,  to  issue  such  certificates,  contracts,  bonds  or  prom- 
ises in  this  State  unless  such  corporation,  association,  society  or 
order  shall  first  obtain  license  of  the  insurance  commissioner  au- 
thorizing them  so  to  do.  Before  receiving  such  license  such  cor- 
poration, association,  society  or  order  shall  file  witli  the  insurance 
commissioner  a  certified  copy  of  its  charter  and  by-laws,  and  a  full 
statement,  under  oath  of  its  president  and  secretary,  showing  the 
financial  standing  of  the  corporation,  association,  society  or  order, 
and  explaining  fully  the  plans,  contracts,  and  methods  used  or 
proposed  to  be  used  in  the  ])roseeution  of  their  business,  in  accord- 
ance with  blanks  furnislied  bj'  him.  Upon  receiving  such  copies 
and  statements,  if  the  insurance  commissioner  is  satisfied  with  the 
same,  and   that    the  plans,   contracts,  and  methods  are  worthy  of 


THE    STATK    OF    NEW    HAMPSHIRE  (j71 

])ulj|i('  palriiuiiyi',  iiiid  Ili,-i1  sueJi  (/orpdi'ation.  associiit  inn,  society 
or  oi'dcr  is  relial)l('  and  entitled  to  jiublic  confidence,  and  such 
cor]Kn'ation,  association,  society  or  order  has  filed  with  the  insur- 
ance commissioner  a  written  stipulation,  duly  authenticated  by 
the  company,  agreeing  that  any  legal  process  affecting  the  cor- 
jjoralion,  association,  society  or  order  served  on  the  insurance 
eonnnissioner  for  the  time  being  shall  have  the  same  effect  as 
if  served  personally  on  the  corporation,  association,  society  or 
order  within  the  State,  he  shall  grant  such  license  authorizing 
such  corporation,  association,  society  or  order  to  do  business 
under  the  plans,  contracts,  and  methods  by  them  described,  sub- 
ject to  the  laws  of  this  State,  until  the  first  day  of  April  there- 
after, and  annually  thereafter  on  the  first  day  of  April  such  license 
may  be  renewed  so  long  as  the  corporation,  association,  society 
or  order  shall  comply  with  the  requirements  aforesaid.  For  each 
license  as  above,  the  corporation,  association,  society  or  order  .shall 
pay  to  the  insurance  commissioner,  five  dollars  when  applied  for, 
and  if  such  license  be  granted,  five  dollars  more,  and  five  dollars 
for  each  annual  renewal  thereof.  Such  license  may  be  revoked  at 
any  time  by  the  insurance  commissioner  for  the  causes  and  in  the 
manner  jjreseribed  by  law. 

Section  4.  No  person  shall  act  as  an  agent  of  any  such  corpo- 
ration, association,  society  or  order,  until  he  shall  have  filed  with  the 
insurance  commissioner  a  certificate  from  the  corporation,  asso- 
ciation, society  or  order,  or  its  authorized  general  agent,  author- 
izing him  to  act  as  such  agent,  and  obtained  license  thereon  from 
him  so  to  do  for  each  cor]ioration.  association,  society  or  order  for 
which  he  proposes  to  act.  I'pon  filing  the  aforesaid  certificate,  the 
commissioner  shall  issue  a  license  to  such  person  to  act  as  agent 
for  such  corporation,  association,  society  or  order  in  this  State, 
provided  the  corporation,  association,  society  or  order  for  which 
he  proposes  to  solicit  ap])lications  for  certificates,  contracts  or  in- 
vestments, shall  be  authorized  to  do  such  business  in  this  State,  which 
license  shall  continue  until  the  first  day  of  April  thereafter,  unless 
for  cause  revoked  in  the  meantime ;  and  upon  filing  a  certificate 
as  aforesaid,  such  license  may  be  renewed  on  said  first  day  of  April, 
and  annually  thereafter,  and  for  such  license  and  for  each  subse- 


672  FRATERNAL    SOCIETY    LAW 

queut  renewal,  the  person  receiving  the  same  shall  pay  to  the  com- 
missioner the  sum  of  one  dollar.  No  officer  or  member  of  any  such 
corporation,  association,  society  or  order  shall  be  required  to  secure 
license  under  the  provisions  of  this  section  unless  he  is  regularly 
employed  and  devotes  his  time  to  soliciting  membership  for  such 
corporation,  association,  society  or  order,  receiving  compensation 
therefor. 

Section  5.  If  any  person,  except  as  provided  in  section  four  of 
this  act,  shall  solicit  or  receive  any  application  for  an  endowment, 
investment,  bond,  lifetime  benefit  or  death  benefit,  or  receive  money 
or  value  therefor,  for  any  such  corporation,  association,  society 
or  order,  without  such  license  from  the  commissioner,  or  after  the 
license  granted  to  him  or  the  corporation,  association,  society  or 
order  for  which  he  acts  as  agent  has  been  revoked,  he  shall  be  pun- 
ished for  each  offense  by  fine  not  exceeding  one  hundred  dollars, 
one  half  to  the  use  of  the  prosecutor;  but  any  certificate  or  in- 
vestment issued  on  an  application  thus  procured  shall  bind  the 
corporation,  association,  society  or  order,  if  otherwise  valid.  If 
any  agent  shall  refuse  to  show  his  license  when  reqviested  so  to 
do  by  any  person,  he  shall  be  punished  in  the  manner  as  pi'ovided 
for  persons  acting  without  a  license. 

Section  6.  Whenever  the  insurance  commissioner  shall  liave  rea- 
son to  believe  that  any  such  corporation,  association,  society  or  order, 
whether  organized  in  this  State  or  otherwise,  or  any  officer  or  agent 
of  such  corporation,  association,  society  or  order,  or  any  other 
person  shall  have  violated  fuiy  law  of  this  State  relating  to  such 
corporations,  associations,  societies  or  orders,  their  officers  or  agents, 
or  the  business  by  them  conducted,  or  the  laws  relating  to  lotteries, 
gambling  or  wagers,  or  failed  to  comply  with  any  requisition  of 
the  laws  of  this  State  relating  to  such  corporations,  associations, 
societies  or  orders,  their  oiScers  or  agents,  or  the  business  by  them 
conducted,  or  the  laws  relating  to  lotteries,  gambling  or  wagers,  he 
shall  forthwith  report  the  fact,  with  any  information  he  may  have 
relating  thereto,  to  the  attornej'-general  of  the  State,  who  shall, 
if  in  his  judgment  it  is  advisable  so  to  do,  prosecute  every  such 
corporation,  association,  society  or  order,  their  officers  or  agents, 
or  other  person  thereof;  and  any  such  corporation,  association,  so- 


THE    STATE    OF    NEW    HAMPSHIRE  (J73 

ciety  or  oi'dei',  their  officer,  agenl  uv  oilier  i)ers()ii,  upun  couvietiou, 
shall  be  liable  for  each  offense  to  a  fine  not  exceeding-  two  thousand 
dollars  and  eosts  of  prosc-ciition,  and  not  less  than  live  hundred 
dollars. 

Section  7.  The  fees  of  the  eonimissioncr,  when  not  otherwise  pro- 
vided in  this  act,  shall  be  the  same  for  the  examination  of  such 
corporations,  associations,  societies  or  orders  as  jtrovided  by  law 
for  the  examination  of  insurance  companies. 

Assessments  Recoverable  Against  Forfeited  Member. 

A  by-law  of  a  society  provided  for  the  forfeiture  of  member.ship 
upon  the  member  failing  to  pay  three  death  assessments.  Held,  that 
the  member  was  liable  for  assessments  levied  after  his  suspension 
and  withdrawal  for  the  payment  of  a  loss  occurring  during  the  con"- 
tinuance  of  his  membership,  and  that  recovery  might  be  made  against 
the  member  for  such  assessments.  The  Court  said:  "As  a  member 
of  the  association  the  defendant  was  at  the  same  time  both  insurer 
and  insured.  As  to  the  latter  it  was  optional  with  him  to  forfeit 
his  insurance  and  membership  rights  as  he  pleased,  but  as  to  the 
former  he  had  no  option  as  to  the  relinquishment  of  that  condition 
as  it  was  of  a  very  different  class  of  obligation  pertaining  and  at- 
taching to  that  relation. " 

Provident  Mutual  Relief  Association  vs.  0  Pelissier.  June,  1S99,  69 
N.  H.  60C. 

Benefits — Duty  of  Local  Lodge  Upon  Receiving  Same  From  Society. 

A  subordinate  lodge  upon  receiving  the  amount  of  a  benefit  due 
to  a  member  of  such  lodge  which  is  paid  it  by  the  Society,  cannot 
refuse  to  pay  the  benefit  over  to  the  beneficiary,  because  of  the  de- 
ceased member's  non-compliance  Avith  some  of  the  laws  or  rules  of 
the  subordinate  lodge,  such  member  not  having-  been  suspended  or 
expelled. 

Taylor  vs.  Pettee,  December.  1899.  70  N.  H.  38. 
43 


674  FRATBICXAL    SOCIETY    LAW 

Resort  to  Civil  Courts. 

In  the  absence  of  a  by-law  to  the  contrary  a  beneficiary  entitled 
to  a  benefit  dxie  iipon  the  death  of  a  member  may  maintain  an  action 
therefor  without  first  submitting  the  claim  to  the  society  or  anj'  com- 
mittee thereof. 

Mullen  vs.  Court  Queen  City  Order  Foresters,  June,  1900,  70  N.  H. 
327. 

Member  Under  Charges  Not  Entitled  to  Benefits. 

A  member  is  not  entitled  to  benefits  while  charges  are  pending 
against  him.  Where  the  laws  so  provide  and  until  such  charges 
are  disposed  of,  recovery  of  benefits  cannot  be  had  against  the 
society. 

Mullen  vs.  Court  Queen  City  Order  Foresters,  June,  1900,  70  N.  K. 
327. 

Benefits— What  is  Total  Disability. 

Where  a  certificate  stipulates  for  payment  of  an  indenmity  in  the 
event  of  and  during  the  total  disability  of  a  member,  which  requires 
his  absolute  disability  and  continuous  confinement  to  his  house,  the 
necessity  for  confinement  is  held  to  be  merely  an  evidentiary  fact  of 
the  determination  of  the  existence  of  disability,  and  that  the  member 
was  entitled  to  recover  benefits  while  totally  incapacitated  for  labor 
by  illness,  although  he  was  out  of  doors  during  a  portion  of  the  time. 

Scales  vs.  Masonic  Protective  Association,  December.  1900,  70  N.  H. 
490. 

Evidence — Dormant  by  Laws. 

Where  a  by-law  is  relied  upon  to  defeat  a  claim  for  benefits  on  the 
ground  that  a  member  was  forfeited  by  reason  of  refusal  to  make 
payment  of  assessment  in  accordance  with  the  terms  of  a  by-law,  it 
is  competent  to  receive  evidence  to  show  that  the  by-law  has  been 


THE    STATE    OF    NEW   HAMPSHIRE  (;75 

habitually  disregnrded,  and  thereby  waived  so  that  it  is  no  longer 
part  of  the  contract  sued  upon. 

Salvail  vs.  Catholir  Order  of  Foresters,  December,  1900,  70  N.  H.  635. 

By-laws  Binding — No  Vested  Rights. 

By-laws  are  binding  upon  those  who  consent  to  their  adoption, 
or  acquiesce  in  their  enforcement,  although  they  are  irregularly  en- 
acted, and  may  impair  the  so-called  vested  rights  of  members. 

Allen  vs.  Merrimac  County  Odd  Fellows  Association,  April,  1904,  72 
N.  H.  525. 

Fraternal  Societies  Exempt  From  General  Insurance  Laws. 

A  fraternal  beneficiary  law  enacted  in  1895  is  held  to  exempt  fra- 
ternal societies  from  the  general  insurance  laws  of  the  State. 

Brotherhood    Accident    Company    vs.    Linehan    Insurance    Commis- 
sioner, June,  1901,  71  N.  H.  7. 

Liability  of  Members  for  Prosecuting  Members  for  Offenses  Against 
the  Society. 

A  case  action  was  brought  by  a  member  for  libel,  malicious  prose- 
cution ami  conspiracy  to  unlawfully  exjiel  tTu'  plaintiff  from  a  lodge 
of  Odd  Fellows.  The  Court  held  that  in  order  to  sustain  an  action 
of  this  character,  it  would  be  necessary  for  the  plaintiff  to  show 
that  the  defense  instituted  the  prosecution  against  him  without  hav- 
ing probable  cause  to  believe  he  Avas  guilty  of  the  offense  charged, 
and  that  in  such  a  case  it  is  unimportant  how  bitter  and  hostile  the 
defendants'  personal  feelings  again.st  the  plaintiff  were  nor  how 
persistent  they  were  in  endeavoring  to  cause  his  expulsion. 

Moon  vs.  Flack,  Supreme  Court  of  N.  H.,  February,  1907,  65  Atl.  829. 

Members  Acting  in  Judicial  Capacity  Not  Liable  in  Damages  for 
Acts  Done. 

The  officers  of  a  lodge  of  Odd  Fellows,  in  the  prosecution  and  ti'ial 


676  FRATERNAL    SOCIETY    LAW 

of  a  member  charged  with  offences  against  the  laws  of  the  Society 
were  held  to  be  acting  in  a  judicial  capacity  and  as  such  are  not 
responsible  in  damages  for  their  acts  in  that  prosecution.  To  hold 
otherwise  would  be  to  violate  the  fundamental  principle  relating  to 
the  administration  of  justice  and  the  due  and  orderly  system  for 
settlement  of  private  contentions. 

Moon  vs.  Flack,  Supreme  Court  of  N.  H..  February.  1907.  65  Atl.  829. 


I 


THE    STAT  I',    OF    NEW  JERSEY  677 


THE 

STATE  OF  NEW  JERSEY. 

CHAPTER  31. 

The  Fraternal  Societies  in  New  Jersey  are  governed  by  Chap. 
128  Laws  of  1893,  which  was  ap])roved  March  11,  1893.  Section  one 
of  said  chapter  was  amended  by  act  approved  May  13,  1907,  and  the 
said  chapter  128  or  so  amended  is  as  follows : 

1.  A  fraternal  beneficiary  association  is  hereby  declared  to  be  a 
corporation,  society  or  voluntary  association,  organized  and  carried 
on  for  the  sole  benefit  of  its  members  and  their  beneficiaries,  and  not 
for  profit,  having  a  lodge  s.ystem  with  a  ritualistic  form  of  work  and 
a  representative  form  of  government,  and  making  provision  for  the 
payment  of  benefits  in  case  of  sickness,  disability  or  death  of  its 
members,  subject  to  their  compliance  with  its  constitution  and  laws, 
the  fund  from  which  the  payment  of  such  benefits  shall  be  made  and 
the  fund  ivom  which  the  expenses  of  such  association  shall  be  de- 
frayed being  derived  from  assessments  or  d\ies  collected  from  its 
members,  and  the  payment  of  death  benefits  beins'  made  to  the  fam- 
ilies, heirs,  blood  relatives,  affianced  husband  or  affianced  wife  of, 
or  to  persons  dependent  upon,  the  members.  Such  associations  .shall 
be  governed  by  this  act  and  shall  be  exempt  from  the  provisions  of 
insurance  laws  of  this  State,  and  no  law  hereafter  passed  shall  apply 
to  them  unless  they  be  expressly  designated  therein.  Nothing  in  this 
act  shall  appl.y  to  any  fraternal  beneficiary  society,  order  or  asso- 
ciation heretofore  licensed  or  authorized  to  do  business  in  this  State, 
and  such  society,  order  or  association  may  continue  to  transact  busi- 
ness in  this  State  as  heretofore. 

2.  That  all  such  associations  coming  within  the  description  as  set 


678  FRATERNAL    HOCIETY    LAW 

iortli  in  section  one  of  this  act,  organized  under  the  laws  of  this  or 
any  other  State,  province  or  Territory,  and  now  doing  business  in 
this  State,  may  continue  such  business:  Provided,  That  they  here- 
after comply  with  the  provisions  of  this  act  regulating  annual  re- 
ports and  the  designation  of  the  commissioner  of  banking  and  insur- 
ance as  the  person  upon  whom  process  may  be  served  as  hereinafter 
provided. 

3.  That  any  such  association  coming  within  the  description  as 
set  forth  in  section  one  of  this  act,  organized  under  the  laws  of  any 
other  State,  province  or  Territory,  and  not  now  doing  business  in  this 
State,  shall  be  admitted  to  do  business  within  this  State  when  it  shall 
have  filed  with  the  commissioner  of  banking  and  insurance  a  duly 
certified  copj-  of  its  charter  and  articles  of  association,  and  a  copy  of 
its  constitution  or  laws,  certified  to  by  its  secretary  or  corresponding 
officer,  together  with  an  appointment  of  the  commissioner  of  bank- 
ing and  insurance  of  this  State  as  a  person  upon  whom  process  may 
be  served  as  hereinafter  provided  :  And  provided,  That  such  asso- 
ciation shall  be  shown  by  certificate  to  be  authorized  to  do  business 
in  the  State,  province  or  Territory  in  which  it  is  incorporated  or 
organized  in  ease  the  laws  of  such  State,  province  or  Territory  shall 
provide  for  such  authorization;  and  in  ease  the  laws  of  such  State, 
l^rovince  or  Territory  do  not  provide  for  any  formal  authorization  to 
do  business  on  the  part  of  any  such  association,  then  such  association 
shall  be  shown  to  be  conducting  its  business  in  accordance  with  the 
provisions  of  this  act,  for  which  purpose  the  commissioner  of  bank- 
ing and  insurance  of  this  State  may  personally,  or  by  some  person 
designated  by  him,  examine  into  the  condition,  affairs,  character  and 
business  methods,  accounts,  books  and  investments  of  such  associa- 
tion at  its  home  office,  which  examination  shall  be  at  the  expense  of 
such  association,  and  shall  be  made  within  thirty  days  after  demand 
therefor,  and  the  expense  of  such  examination  shall  be  limited  to  the 
sum  of  fifty  dollars. 

4.  That  every  such  association  doing  business  in  this  State  shall, 
on  or  before  the  first  day  of  March  of  each  year,  make  and  file  with 
the  commissioner  of  banking  and  insurance  of  this  State  a  report 
of  its  affairs  and  niici-ilions  during  1  he  \v;\v  ending  on  the  thirty-first 
(hiy  of  December  immediately  jirecedinu.  wliicli  annual  reimrt  shall 


THE    STATE    OF    NEW   JERSEY  679 

be  in  lieu  of  all  other  reports  required  by  any  other  law ;  such  reports 
shall  be  upon  blank  forms  to  be  provided  by  the  commissioner  of 
banking  and  insurance,  or  may  be  printed  in  pamphlet  form,  and 
shall  be  verified  under  oath  by  the  duly  authorized  officer  of  such 
association,  and  shall  be  i)ublished,  or  the  substance  thereof,  in  the 
annual  report  of  the  commissioner  of  hanking  and  insurance  under 
a  separate  part  entitled  "Fraternal  Beneficiary  Associations."  and 
shall  contain  answers  to  the  following  questions: 

I.  Number  of  certificates  issued  during  the  year,  or  members  ad- 
mitted. 

II.  Amount  of  indemnity  effected  thereby. 

III.  Number  of  losses  or  benefit  liabilities  incurred. 

IV.  Number  of  losses  or  benefit  liabilities  paid. 

V.  The  amount  received  from  each  assessment  for  the  year. 

VI.  Total  amount  paid  members,  beneficiaries,  legal  representa- 
tives or  heirs. 

VI.     Number  and  kinds  of  claims  for  which  assessments  have  been 
made. 

VIII.  Niimber  and  kind  of  claims  compromised  or  resisted,  and 
brief  statement  of  reasons. 

IX.  Does  association  charge  annual  or  other  periodical  dues  or 
admission  fees? 

X.  How  much  on  each  one  thousand  dollars  annually   or  per 
capita,  as  the  case  may  be? 

XI.  Total  amount  received,  from  Avhat  soiirce,  and  the  disposition 
thereof. 

XII.  Total  amount  of  salaries  paid  to  officers. 

XIII.  Does  association  guarantee  in  its  certificates  fixed  amounts  to 
be  paid  regardless  of  amount  realized  from  assessment  dues,  admis- 
sion fees  and  donations? 

XrV.     If  so,  state  the  amount  guaranteed,  and  the  security  of  sucH 
guaranty. 

XV.  Has  the  association  a  reserve  fund? 

XVI.  If  so,  how  is  it  created  and  for  what  purpose,  the  amount 
thereof  and  how  invested? 

XVII.  Has  the  association  more  than  one  class? 

XVIII.  If  so,  how  manv.  and  the  amount  of  indemnity  in  each? 


680  FRATERNAL    SOCIETY    LAW 

XIX.  Number  of  members  in  each  class. 

XX.  If  voluntary,  so  state,  and  give  date  of  organization. 

XXI.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time,  giving  chapter  and  year  and  date  of  passage  of 
the  act. 

XXII.  If  organized  under  the  laws  of  any  other  State,  province 
or  Territory,  state  .such  fact  and  the  date  of  organization,  giving 
chapter  and  year  and  date  of  passage  of  the  act. 

XXIII.  Number  of  certificates  of  beneficiary  membership  lapsed 
during  the  year. 

XXIV.  Number  in  force  at  beginning  and  end  of  year;  if  more 
than  one  class,  number  in  each  class. 

XXV.  Name  and  address  of  its  president,  secretary  and  treas- 
urer, or  eorrespondnng  officers. 

The  commissioner  of  banking  and  insurance  is  empowered  to  ad- 
dress any  additional  inquiries  to  any  such  association  in  relation 
to  its  doings  or  condition,  or  any  other  matter  connected  with  its 
ti'ansaction  relative  to  the  business  contemplated  by  this  act,  and 
such  officers  of  such  association  as  the  commissioner  of  banking  and 
insurance  may  require  shall  promptly  reply  in  writing,  under  oath, 
to  all  such  inquiries. 

5.  That  each  such  association  now  doing  or  hereafter  aduaitted 
to  do  business  within  this  State  and  not  having  its  principal  office 
within  this  State,  and  not  being  organized  under  the  laws  of  this 
State,  shall  appoint,  in  writing,  the  commissioner  of  banking  and 
insurance  or  his  siiccessor  in  office  to  be  its  true  and  lawful  attorney, 
upon  whom  all  lawful  process  in  any  action  or  proceeding  against  it 
may  be  served,  and  in  such  writing  shall  agree  that  any  lawful  pro- 
cess against  it  which  is  served  on  said  attorney  shall  be  of  the  same 
legal  force  and  validity  as  if  served  upon  the  association,  and  that 
the  authority  shall  continue  in  force  so  long  as  any  liability  remains 
outstanding  in  this  State;  copies  of  such  certificate,  certified  by  said 
commissioner  of  banking  and  insurance,  shall  be  deemed  sufficient 
evidence  thereof,  and  shall  be  admitted  in  evidence  with  the  same 
force  and  efl'eet  as  the  original  thereof  might  be  admitted :  service 
upon  such  attorney  shall  be  deemed  sufficient  service  ui)on  such  asso- 
ciation ;  when  legal  process  against  any  such  association  is  served 


THE    STATE    OF    NEW    JERSEY  681 

upon  said  commissioner  of  bankiijg  and  insurance,  he  shall  imme- 
di;itply  notify  the  association  of  such  service  by  letter,  prepaid  and 
directed  to  its  secretary  oi-  oorrcsiionding  officer,  and  shall  within 
two  d;iys  after  such  service  forward  in  the  same  maimer  a  copy  of 
the  process  served  on  him  to  such  officer;  the  plaintiff  in  such  process 
so  served  shall  pay  to  the  commissioner  of  banking  and  insurance,  at 
the  time  of  such  service,  a  fee  of  three  dollars,  which  shall  be  recov- 
ered by  him  as  part  of  the  taxable  costs  if  he  prevails  in  the  suit;  the 
coiuniissiouer  of  banking  and  insurance  shall  keep  a  record  of  all 
processes  served  upon  him,  which  record  shall  show  the  day  and 
hour  when  such  service  was  made. 

6.  That  the  commissioner  of  banking  and  insurance  shall,  upon 
application  of  any  association  having  the  right  to  do  business  within 
this  State  as  provided  by  this  act,  issue  to  such  association  a  permit 
in  writing,  authorizing  such  association  to  do  business  within  this 
State,  for  which  certificate  and  all  proceedings  in  connection  there- 
with such  association  shall  pay  to  said  commissioner  the  fee  of  five 
dollars. 

7.  (Section  providing  for  incorporation,  repealed  July  -t,  1899.  by 
chapter  76,  laws  of  1899.) 

8.  That  such  associations  shall  -not  employ  paid  agents  in  solicit- 
ing or  procuring  members,  except  in  the  organizing  or  building  up 
of  subordinate  bodies  or  granting  members  inducements  to  procure 
new  members. 

9.  That  no  contract  with  any  such  association  shall  be  valid  when 
there  is  a  contract,  agreement  or  understanding  between  the  mem- 
ber and  the  beneficiary  or  any  person  for  him  shall  pay  such  mem- 
ber's assessments  and  dues,  or  either  of  them. 

10.  That  the  money  or  other  benefit,  charity,  relief  or  aid  to  be 
paid,  provided  or  rendered  by  any  association  authorized  to  do  busi- 
ness under  this  act  shall  not  be  liable  to  attachment  by  trustee, 
garnishee,  or  other  process,  and  shall  not  be  seized,  taken,  appro- 
priated or  applied  b,v  any  legal  or  equitable  process,  or  by  operation 
of  law,  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any 
beneficiary  named  in  a  certificate,  or  of  any  person  who  may  have 
any  right  thereunder. 

11.  That  anv  such  association  orsranized  under  the  laws  of  this 


6g2  FRATERNAL    SOCIETY    LAW 

State  may  provide  for  the  meetings  of  its  legislative  or  governing 
body  in  any  other  State,  province  or  Territory  wherein  such  asso- 
ciation shall  have  subordinate  bodies ;  and  all  business  transacted  at 
such  meetings  shall  be  valid  in  all  respects  as  if  such  meetings  were 
held  in' this  State;  and  where  the  laws  of  any  such  association  pro- 
vide for  the  election  of  its  officers  by  vote  to  be  cast  in  its  subordinate 
bodies,  the  vote  so  cast  in  its  subordinate  bodies,  in  any  other  State, 
province  or  Territory,  shall  be  valid  as  if  cast  within  this  State. 

12.  That  any  person,  officer,  member  or  examining  physician,  who 
shall  knowingly  or  wilfully  make  any  false  or  fraudulent  statement 
or  representation,  in  or  with  reference  to  any  application  for  mem- 
bership, or  for  the  purpose  of  obtaining  any  money  or  benefit  in 
any  association  transacting  business  under  this  act,  shall  be  guilty 
of  a  misdemeanor,  and  upon  conviction  shall  be  punished  by  a  fine 
of  not  less  than  one  hundred  dollars  nor  more  than  five  hundred  dol- 
lax's,  or  imprisonment  in  the  county  jail  for  not  less  than  thirty  days 
nor  more  than  one  year,  or  both,  in  the  discretion  of  the  court :  and 
any  person  who  shall  willfully  make  a  false  statement  of  any  ma- 
terial fact  or  thing  in  a  sworn  statement  as  to  the  death  or  disa- 
bility of  a  certificate  holder  in  any  such  association,  for  the  purpose 
of  procuring  payment  of  a  benefit  named  in  a  certificate  of  such 
holder,  and  any  person  who  shall  wilfully  make  any  false  state- 
ment in  any  verified  report  or  declaration  under  oath  required  or 
authorized  by  this  act,  shall  be  guilty  of  perjury  and  shall  be  pro- 
ceeded against  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  perjury. 

13.  That  whenever  said  commissioner  of  banking  and  insurance 
shall  become  satisfied  that  any  such  association  doing  business 
within  this  State  is  exceeding  its  power,  or  conducting  its  business 
fraudulently,  he  may  personally,  or  by  some  person  to  be  designated 
by  him,  examine  into  the  condition,  affairs,  character  and  business 
methods,  accounts,  books  and  investments  of  such  association  at  its 
home  office,  which  examination  shall  be  at  the  expense  of  such  asso- 
ciation, antl  sueli  expense  shall  be  limited  to  the  sum  of  fifty  dollars. 

14.  That  any  such  association  refusing  or  neglecting  to  make 
the  report  as  provided  in  this  act  shall  be  excluded  from  doing  busi- 
ness within  this  State;  said  commissioner  of  banking  and  insurance 


b 


THE    STATE    OF    NEW    JERSEY  683 

must  within  sixty  days  after  failure  to  make  such  report,  or  in  cmsc 
any  such  association  shall  exceed  its  powers  or  shall  conduct  its 
business  fraudulently,  or  shall  fail  to  comply  with  any  of  the  pro- 
visions of  this  act,  or  shall  refuse  to  submit  its  accounts,  books, 
papers  and  vouchers  for  examination  by  said  commissioner  or  person 
designated  by  him,  shall  give  notice  in  writing  to  the  Attorney- 
General,  who  shall  immediately  commence  an  action  against  such 
association  to  enjoin  the  same  from  carrying  on  any  business;  and 
no  injunction  against  any  such  association  shall  be  granted  by  any 
court,  except  on  application  by  the  Attorney-General,  at  the  request 
of  the  commissioner  of  banking  and  insurance;  no  association  so 
enjoined  shall  have  authority  to  continue  business  until  such  reports 
shall  be  made,  or  overt  acts  or  violations  complained  of  shall  have 
been  corrected,  nor  until  the  cost  of  such  action  be  paid  by  it: 
Provided,  The  coui-t  sliall  find  that  such  association  was  in  dcfnult 
as  charged,  whereupon  the  commissioner  of  banking  and  insurance 
shall  re-instate  such  association,  and  not  until  then  shall  such  asso- 
ciation be  allowed  to  again  do  business  in  this  State;  any  officer, 
agent  or  person  acting  for  any  association  or  subordinate  body 
thereof,  within  this  State,  while  such  association  shall  be  so  enjoined 
or  ijrohibited  from  doing  business  pursuant  to  this  act,  shall  be 
deemed  guilty  of  a  misdemeanor,  and  on  conviction  thereof  shall  be 
punished  by  a  fine  not  less  than  twenty-five  nor  more  than  two  hun- 
dred dollars,  or  by  imprisonment  in  the  county  jail  not  less  than 
thirty  days' nor  more  than  one  year,  or  by  both  such  fine  and  im- 
prisonment, in  the  discretion  of  the  coui't. 

15.  That  any  person  who  shall  act  within  this  St^te  as  an  officer, 
agent  or  otherwise,  for  any  association  which  shall  have  failed, 
neglected  or  refused  to  comply  with,  or  shall  have  violated  any  of 
the  ju-ovisions  of  this  act,  or  shall  have  failed  or  neglected  to  procure 
from  the  commissioner  of  banking  and  insurance  proper  certificates 
of  avithority  to  transact  business,  as  ])rovided  for  by  this  act,  shall 
be  subject  to  the  penalty  provided  in  the  last  i)receding  section  for 
the  misdemeanor  therein  specified. 

16.  That  this  act  shall  not  apply  to  any  corporation,  society  or 
association,  carrying  on  the  business  of  life,  health,  casualty  or  acci- 
dent insurance  for  profit  or  gain,  but  it  shall  apply  to  fraternal  bene- 


684  FRATERNAL    SOCIETY    LAW 

ficiary  associations  only,  as  defined  in  section  one  of  this  act;  this  act 
shall  not  affect  or  apply  to  any  grand  or  subordinate  lodges  of  the 
Ancient  Order  of  Free  and  Accepted  Masons,  Independent  Order  of 
Odd  Fellows,  Improved  Order  of  Red  Men,  Junior  Order  of  American 
Mechanics,  as  they  now  exist,  nor  of  the  Knights  of  Pythias  (ex- 
clusive of  the  endowment  rank),  nor  to  similar  orders,  nor  to  any 
association  not  working  on  the  lodge  system  or  which  limits  its  cer- 
tificate holders  to  a  particular  class  or  to  the  employees  of  a  particu- 
lar town  or  city,  designated  firm,  business  house  or  corporation. 

17.  That  every  association  to  which  this  act  shall  be  applicable 
.shall  pay  the  following  fees  to  the  commissioner  of  banking  and 
insurance  for  defraying  the  expenses  of  this  act.  viz.: 

For  filing  the  declaration  or  a  certified  copy  of  charter  required  by 
this  act,  ten  dollars. 

For  filing  the  annual  report  therein  provided,  five  dollars. 

For  every  copy  of  any  paper  filed  or  recorded  in  his  office,  eight 
cents  per  folio. 

For  affixing  his  official  seal  on  such  copy  and  certifjnng  same,  one 
dollar. 

18.  That  all  acts  and  parts  of  acts  inconsistent  with  the  provisions 
of  this  act  are  hereby  repealed,  and  that  this  act  shall  take  effect 
innuediatel}'. 

Can  a  Member  Set  Off  His  Claim  of  Losses  Against  Society's  Claim 
for  Assessments? 

The  receiver  of  a  mutual  assessment  insurance  company  brought 
an  action  to  recover  assessments  upon  a  policy  of  insurance.  The 
defendants  sought  to  set  off  a  sum  due  to  it  for  losses  covered  by 
the  policy.  The  question  presented  was  whether  there  was  a  right 
of  set-off.    The  Court,  in  discussing  this  question,  said: 

"Under  such  a  contract,  the  relation  of  the  defendant  to  the  asso- 
ciation is  two-fold.  It  is  assured  thereby,  and  hence  a  possible 
creditor.  It  is  a  member  of  the  association,  and  hence  a  quasi 
partiicf  ill  the  enterprise.  The  pres(>nt  suit  is  to  enforce  the  liability 
of  the  defendants  in  the  character  of  member.  The  set-off  is  claimed 
in  its  character  of  creditor.     The  injustice  of  allowing  one  member 


THE    STATE    OF    NEW    JERSEY  685 

ol'  a.  iiiiitiKil  iiisiiniiii'c  cdiiii):!!! y  on  .'in  asscssiin'iil  plan  l.o  escapi' 
lial)ility  to  contribute  to  the  coiiiiiioii  fund,  and  tliei'cljy  obtain  an 
advantage  ovef  liis  fellow  members,  all  of  whom  embarked  on  the 
same  enterprise,  presumably  on  equal  terms;  and  to  allow  one 
creditor  of  an  insolvent  company  to  be  preferred  over  other  creditors, 
merely  because  of  his  liability  to  contribute  to  the  loss  of  all.  is  mani- 
fest. The  authorities  seem  quite  unanimous  in  disallowing  his  sef-off 
in  such  a  case. ' ' 

Stone  vs.  New  Jersey  Co.,  Supreme  Court  of  N.  J.,   June,   1907,   66 
Atl.  1072. 

Members  Must  Exhaust  Remedies  in  Society  Before  Resorting  to 
Civil  Courts. 

An  application  for  mandamus  was  filed  seeking  to  secure  the  rein- 
statement of  a  suspended  court,  which  court  had  been  summarily 
suspended  by  the  chief  executive  official  of  the  order.  Subsequent 
to  the  suspension  a  hearing  was  given  to  the  suspended  court  before 
the  executive  council  of  the  Society,  which  body  sustained  and  con- 
tinned  the  suspension.  It  was  charged  that  the  suspension  was 
irregularly  made  aiul  the  hearing  before  the  executive  council  irregu- 
larly and  luifairly  conducted  and  that  the  proceedings  were  void. 
The  Society  denied  this  and  claimed  that  the  suspended  court  must 
first  exhaust  its  remedies  by  an  appeal  to  the  superior  bodies  of  the 
Society  where  such  an  appeal  may  be  had.    The  Court  said : 

"The  case  shows  that  under  the  rules  of  the  organization  there  is 
a  right  to  appeal  to  the  subordinate  high  court  which  will  meet  in 
September  next,  and  from  the  decision  of  the  latter  there  may  be 
an  appeal  to  the  supreme  high  court.  It  should  be  stated  that  this 
is  not  a  case  involving  property  rights  or  money  demands,  but  in- 
volves a  question  of  discipline  only.  While  the  case  shows  that  the 
high  court  has  a  sick  and  funeral  benefit  department,  the  subordin- 
ate courts  cannot  participate  in  it  unless  they  are  connected  with 
that  department  by  becoming  contributors  to  that  fund.  The  court 
Manhattan  was  not  connected  with  that  department,  but  had  its 
own  benetieial  department  as  allowed  by  the  rules.  In  such  a  situa- 
tion, the  law  is  settled  that  ordinarily  the  appeal  must  first  be  taken 


686  FRATERNAL    SOCIETY    LAW 

within  the  orgauizatioii,  before  recourse  can  be  had  to  the  civil 
courts  (Zelift'  vs.  Knights,  53  N.  J.  Law  536 :  22  Atl.  63.)  The  rehitor 
contends  that  this  principle  should  not  be  applied  to  this  application 
on  the  ground  that  the  irregularity  of  the  hearing  was  so  marked 
that  no  testimony  or  minutes  were  taken,  and  hence  there  was  no 
record  upon  which  to  ajjpeal.  But  the  case  shows  that  the  relator 
and  his  witnesses  were  examined  in  the  pi-esence  of  the  council  and 
that  there  were  some  minutes  Icept  of  the  proceedings,  and  it  cannot 
be  said  that  the  action  of  the  council  was  void  for  want  of  juris- 
diction. It  is  presumed  that  the  appellate  body  within  the  organ- 
ization will  do  justice  between  the  parties." 

Grant  vs.  Ancient  Order  of  Foresters.  Supreme  Court  N.  J.,  June, 
1907.  66  Alt.  902. 

Resort  to  Civil  Courts — Void  Lodge  Trial. 

A  member  that  had  been  expelled  from  the  Society  sought  by  man- 
damus to  be  reinstated.  A  by-law  of  the  Society  provided  that  the 
trustees  should  strike  from  the  roll  and  expel  from  the  benefits  of  the 
Society  all  persons  unlawfully  or  improperly  upon  the  roll,  or  who 
should  refuse  to  comply  with  any  lawful  requirements  regarding 
same.  The  member  was  required  to  furnish  information  as  to  his  age. 
and  was  notified  that  unless  he  furnished  such  information  by  a  date 
certain  his  refusal  would  be  communicated  to  the  trustees.  The 
member  failed  to  furnish  the  information,  and  his  name  was  stricken 
from  the  list  of  members.    The  Court  said: 

"We  think  that  the  jn-oceeding,  as  set  forth,  was  not  a  lawful 
mode  of  expelling  a  member  for  the  cause  stated.  The  relator's 
right  to  participate  in  the  fund  in. question  was  a  property-  right. 
Hence  his  expulsion  involved  more  than  a  mere  matter  of  discipline. 
It  was  a  quasi  judicial  proceeding.  The  relator  became  a  member 
of  the  order  and  of  the  benefit  fund  in  1897.  and  at  that  time  com- 
plied with  all  the  requirements  tlu'u  in  force  whifli  included  a  pre- 
cise statement 'of  the  date  and  yeai'  of  his  bii-th.  *  *  *  AVhen  the 
relator  was  notified  that  upon  his  failnr(>  to  answer  the  question  that 
was  put  to  him,  the  trustees  would  take  such  action  as  Article  16 
warranted,  he  was  justified  in  supposing  that  such  action  would  be 


THE    STATE    OF    NEW    JERSEY  687 

ill  the  form  of  trial  in  which  he  would  have  the  ticncfit  of  a  specifica- 
tion of  the  precise  offence  with  which  he  was  charged,  and  notice  of 
the  time  and  place  when  such  eharsre  would  be  i)r()vi'd  against  liim, 
and  an  opportunity  to  be  heard  in  liis  defense.  In  a  ipiasi  judicial 
proceeding-  affecting  his  property  riglits.  the  relator  was  entitled 
to  this  protection." 

Byrne  vs.  The  Supreme  Circle  Brotherhood  of  the  Union,  Supreme 
Court  of  N.  J.,  February,  1907,  65  Atl.  839. 

Lodge  Trials— Member  Charged  Entitled  to  Make  Defense. 

A  members  had  been  expelled  from  the  society  and  he  brought 
mandamus  proceedings  to  secure  his  restoration.  It  was  charged 
by  the  member  that  his  expulsion  was  illegal  because  among  other 
reasons  he  was  not  given  an  opportunity  to  be  heard  in  his  defense. 
The  Court  said : 

"We  think  that  his  contention  must  prevail.  The  member  of  a 
benevolent  association,  against  whom  proceedings  are  pending  which 
have  his  expulsion  for  their  object,  may  make  such  defense  as  he 
may  have  to  the  charges  upon  which  the  proceedings  are  based,  and 
if  he  is  expelled  without  having  an  opportunity  to  present  his  de- 
fense, he  is  deprived  of  a  substantial  right  which  the  ordinary  prin- 
ciples of  justice  require  that  he  be  iicrinitted  to  enjoy." 

Venezia   vs.    Italian    Mutual    Benevolent   Society,    Supreme   Court  of 
N.  J.,  Marcli,  1907,  65  Atl.  89S. 

Members  Rights  Under  Medical  Examination. 

A  certificate  provided  that  the  secretary  of  the  medical  board  of 
the  society  should  have  the  power  to  reconsider  any  medical  exam- 
ination within  six  months  after  passing  the  same,  and  if  there  be 
sufficient  cause  which  existed  at  the  time  of  the  examination  to  have 
rejected  the  applicant,  said  secretary  might  reject  the  applicant, 
and  whereupon  the  member  should  cease  to  be  a  beneficiary  mem- 
ber of  the  society  and  the  certificate  issued  should  become  null  and 
void.  It  was  held  in  a  suit  upon  the  certificate  that  the  society  in 
order  to  sustain  a  defense  that  a  medical  examination  was  reconsid- 


688  FRATERNAL    SOCIETY    LAW 

ered,  and  the  applicant  rejected,  must  prove  that  such  rejection  was 
for  a  sufHeient  cause  which  existed  at  the  time  of  the  original  exam- 
ination. 

Gilroy  vs.  Supreme  Court  I.  0.  F.,  November.  1907.  Court  of  Errors 
and  Appeals,  N.  J.,  67  Atl.  1037. 

Judgments  of  Tribunals,  Finalty  of  Same. 

As  to  a  provision  in  the  laws  of  a  society  which  have  the  effect 
of  making  the  judgment  of  the  supreme  tribunal  of  the  society  con- 
clusive, the  court  in  construing  this  provision  said,  "The  clause 
making  the  action  or  decision  of  the  Supreme  Court  of  the  order 
final  and  conclusive  occurs  in  the  provision  for  appeals,  which 
provides  that  the  right  of  appeal  shall  be  vested  in  every  court,  and 
that  an  appeal  shall  lie  against  the  action  or  decision  of  any  ofiSeer 
or  of  any  court,  except  the  action  or  decision  of  the  Supi'eme  Court, 
and  that  is  made  final  and  conclusive  in  all  cases.  We  think  the 
words  'final  and  conclusive'  were  enacted  to  mark  the  distinction 
between  the  efi'ect  of  the  decision  of  the  Supreme  Court  of  the  order 
and  that  of  its  other  courts,  and  not  to  exclude  the  jurisdiction  of 
the  legal  tribimal.  The  Supreme  Court  of  the  order  is  the  only 
corporation  whose  contractual  liability  is  in  question,  and  we  ought 
not  to  adopt  a  construction  which  would  make  it  the  final  judge  of 
its  own  cause." 

Gilroy  vs.  Supreme  Court  I.  0.  F..  November,  1907.  Court  of  Errors 
and  Appeals,  N.  J..  67  Atl.  1037. 

Warranties  and  Representations,  Rule  With  Respect. 

The  member  represented  in  his  application  in  response  to  ques- 
tions propounded,  that  his  father  died  of  pneumonia,  when  in  fact 
he  died  of  phthisis.  A  provision  in  the  laws  was  to  the  eifect  that 
if  the  applicant  makes  any  false  statement  or  gives  any  untrue 
answers,  or  conceals  i>r  neglects  to  disclose  any  material  fact  relat- 
ing to  payments  or  to  anything  contained  in  his  medical  examina- 
tion, he,  ipso  facto  forfeits  all  payments  and  all  benefits  that  he 
or  his  benefieiarv  would  otherwise  be  entitled  to  receive.    The  court 


THE    STATE    OF    NEW    JERSEY  689 

s;ii(l :  "The  question  is  presented  therefore,  whether  the  ai:swer 
must  be  absolutely  triu>  in  oi-der  to  ])revent  the  forfeiture,  or  whether 
it  suffices  that  the  assured  honestly  believed  it  to  be  true.  Whether 
the  statements  are  to  be  regarded  as  warrantees  or  as  representations 
is  not  important.  If  representations,  they  were  as  to  a  fact  material 
to  the  risk,  the  obligation  of  the  assured  to  answer  truthfully  was  as 
great  as  if  his  answers  were  warranted  to  be  true.  The  rule  adopted 
by  this  court  is  that  with  re.speet  to  questions  as  to  matters  that  the 
insurer  must  know  are  not  within  the  personal  knowledge  of  the 
applicant,  with  respect  to  those  that  call,  not  for  definite  statements 
of  facts,  but  for  statements  of  belief  or  opinion ;  the  letter  of  the 
contract  is  to  be  controlled  by  its  spirit  and  [lurposes:  and  the 
answers  will  he  deemed  warranted  only  of  the  Ixma  fide  belief  and 
opinion  of  the  applicant." 

Gilroy  vs.  Supreme  Court  I.  O.  F.,  November.  1907,  Court  of  Errors 
and  Appeals,  N.  J.,  67  Atl.  1037. 

Members  Have  Voice  in  Changing  Purposes  of  Society. 

The  objects  of  a  soeiet_y  cannot  be  changed  without  the  vote  of 
the  con.stituent  members. 

State  Council  .Junior  Order  of  United  American  Mechanics  vs. 
National  Council  Junior  Order  of  United  American  Mechanics 
of  America  et  al.,  August,  1906,  Court  of  Cliancery  of  N.  J.,  64 
Atl.   561. 

Purposes  of  Society,  Change  of. 

The  constitution  of  a  national  and  state  society  provided  that  the 
objects  of  the  society  was  to  establish  a  sick  and  funeral  fund,  and 
that  such  objects  should  not  be  changed  except  by  the  vote  of  the 
constituent  members  of  the  society.  The  National  Society  attempted 
to  enforce  an  amendment  providing  for  the  creation  of  a  "insiar- 
ance  branch  and  a  sick  funeral  fund"  \vithout  .submitting  such 
amendment  to  the  members  of  the  society.  Tt  was  held  that  such 
amendment  constituted  a  material  change  which  justified  the  with- 
draAval  of  the  state  council  from  affiliation. 
4-1 


« 


690  FRATERNAL    SOCIETY    LAW 

State  Council  Junior  Order  of  United  American  Mechanics  vs. 
National  Council  Junior  Order  of  United  American  Mechanics 
of  America  et  al.,  August,  1906,  Court  of  Chancery  of  N.  J.,  64 
Atl.  561. 

Right  of  Subordinate  to  Secede  from  Society. 

The  state  council  of  a  society  was  incorporated  in  New  Jersey 
prior  to  the  organization  and  incorporation  of  the  national  council 
composed  of  delegates  chosen  from  the  various  state  councils,  the 
affiliation  between  the  state  and  national  council  was  voluntary,  and 
it  was  held  that  upon  the  termination  of  such  affiliation  liy  the 
withdrawal  of  the  state  council  from  the  national  council,  that  the 
former  was  entitled  to  the  corporate  name  and  had  the  right  to 
restrain  the  national  council  from  operating  within  the  state  under 
such  name  for  the  purpose  of  destroying  the  state  council  and  its 
various  subordinate  bodies. 

state  Council  Junior  Order  of  United  American  Mechanics  vs. 
National  Council  Junior  Order  of  United  American  Mechanics 
of  America  et  al.,  August,  1906,  Court  of  Chancery  of  N.  J.,  64 
Atl.   561. 

Warranty,  Breach  in  Part  and  Waiver. 

When  a  statement  in  an  application  for  insurance  was  warranted 
to  be  true,  and  it  is  proven  that  it  is  false  in  part,  the  applicant 
failing  to  answer  the  whole  inquiry,  there  is  a  breach  of  warranty 
which  avoids  the  contract  but  the  insurer  waives  an  answer  to  that 
part  of  the  inquiry  oiily  which  is  left  unanswered. 

Hanrahan  vs.  Metropolitan  Life  Insurance  Co.,  March,  1906,  Court 
of  Errors  and  Appeals  N.  J.,  63  Atl.  280. 

After-enacted  Liquor  Law  Valid. 

A  provision  was  contained  in  a  benefit  certificate  which  provided 
for  the  member's  compliance  "with  all  the  laws,  regulations,  and  re- 
quirements which  are  or  may  be  hereafter  enacted  by  said  order 
is  the  express  condition  upon  which  I  am  to  be  entitled  to  participate 
in  the  beneficiary  fund  and  have  and  enjox-  all  the  iAhov  benefits 


THE    STATE    OF    NEW    JEHHEY  691 

and  privileges  of  such  order."  Subsequent  to  tlic  issuance  of  this 
certificate  a  by-law  was  adopted  providing  that  "any  member  of 
the  order  who  shall,  after  August  1st,  1898,  enter  the  business  of 
selling  by  retail  intoxicating  liquors  as  a  beverage  shall  be  expelled 
from  the  order"  and  made  provision  for  suspension  from  rights  in 
the  beneficiary  fund  and  rendered  the  certificate  null  and  void,  it 
was  held  that  such  after-enacted  by-law  was  valid  and  binding  upon 
one  who  was  holding  a  certificate  at  the  time  of  its  enactment. 

The  State  ex  rel  Strang  vs.  Camden  Lodge  A.  O.  U.  W.,  February, 
1906,  73  N.  J.  L.  500. 

Forfeiture — Burden  of  Showing  at  all  Times. 

The  burden  of  showing  that  a  member  has  not  made  payment  of 
an  assessment,  although  notice  of  such  assessment  had  been  mailed 
to  the  member  while  living  at  his  last  known  postoffice  address,  as 
required  by  the  by-laws,  was  upon  the  defendant. 

Van  Etten  vs.  Grand  Lodge  A.  O.  U.  W.,  February,  1905,  72  N.  J.  L. 
61. 

After-enacted  Suicide  Law. 

A  member  in  his  application  expressly  agreed  to  conform  in  all 
respects  to  the  laws,  rules,  and  usages  of  the  order,  then  in  force 
or  which  might  be  thereafter  adopted.  Subsequent  to  the  issuance 
of  the  certificate  the  society  adopted  a  law  which  read:  "No  bene- 
fit shall  be  paid  to  a  beneficiary  or  beneficiaries  of  any  member  com- 
mitting suicide  while  sane  or  insane,"  and  subsequent  to  the  pas- 
sage of  such  by-law  the  member  in  question  suicided  and  the  fact  of 
the  membership,  the  agreement,  passage  of  the  suicide  law,  and  that 
the  member  committed  suicide,  was  set  out  in  a  plea  filed  in  a  suit 
brought  to  recover  upon  the  certificate  in  question.  A  demurrer 
was  filed  to  the  plea  and  in  passing  upon  the  pleadings  the  court 
said: 

"The  plea  demurred  to  sets  forth  no  facts  which  constitute  a  bar 
to  this  action ;  it  does  not  aver  any  violation  by  the  insured  of  any 
law,  rule  or  regulation  of  the  association  enacted  by  it  for  its  gov- 


692  FRATERXAL    SOCIETY    LAW 

ernment  or  for  the  goverument  of  its  fund;  but,  by  waj-  of  argu- 
ment, asserts  that  he,  by  entering  into  the  stipulation  which  it  re- 
cites agreed  that  the  association  might,  at  will,  so  change  the  eon- 
tract  of  insurance  as  to  relieve  it.  to  a  material  extent  from  the 
liability  created  thereby.  We  think  such  a  construction  of  the  stip- 
ulation is  not  warranted  by  its  language.  To  say  that  it  coiifi-rs 
upon  the  association  the  power  to  so  alter  the  contract  of  insurance 
by  an  after-adopted  by-law  is  to  destroy  the  right  of  the  beneficiary 
to  be  paid  the  amount  called  for  by  the  certificate,  iu  case  the  in- 
sured shall  die  by  his  own  hand,  is  equivalent  to  saying  that  it 
authorized  the  association  to  limit  its  liability  to  such  an  extent  as 
it  chose :  for  instance,  by  providing  that  no  benetit  shall  lie  paid  in 
case  the  death  of  the  insured  shall  result  from  an  accident  occurring 
through  his  own  negligence  or  from  a  disease  which  is  epidemic  in  ifs 
character,  or  from  any  other  cause  or -causes  which  it  may  designate. 
An  agreement  by  a  person  applj'^ing  for  membership  in  one  of  these 
fraternal  organizations  and  for  insurance  therein,  that  he  will  com- 
ply with  such  rules  and  regulations  as  the  association  may  thereafter 
enact  for  its  own  government,  or  the  government  of  its  death  fund, 
cannot  be  construed  into  a  stipulation  conferring  any  such  power  as 
has  been  suggested  without  disregarding  the  plain  meaning  of  the 
words  of  the  agreement." 

Sautter  vs.  Supreme  Conclave  Improved  Order  of  Heptasophs.  .lune, 
1906,  72  N.   J.  L.  325. 

Cause  of  Action  Accrues  Upon  Repudiation  of  Contract. 

Where  a  contract  embodies  mutual  and  inter-dependent  conditions 
and  obligations,  and  one  part  either  disables  himself  from  perform- 
ing or  jjrevents  the  other  fi'om  performing,  or  repudiates  in  ad- 
vance his  obligations  under  the  contract,  and  refuses  to  be  longer 
bound  thereby,  communicating  such  repudiation  to  the  other  i)arty, 
the  latter  party  is  not  only  excused  from  further  performance  on 
his  part,  but  may,  at  his  option,  treat  the  contract  as  terminated  for 
all  purposes  of  performance,  and  maintain  an  action  at  once  for 
the  damages  occasioned  by  such  repudiation,  without  waiting  the 
time  fixed  by  the  contract  for  performance  by  the  defendant. 


THE    STATE    OF    AWIV    JERSEY  693 

O'Neill  vs.  Supreme  Council  Anieri('an  Legion  o[  Jlonor,  Feby.,  1904, 
70   N.  J.   L.  410. 

Upon  Repudiation  of  Contract  Member  Has  Cause  of  Action  for 
Damages. 

A  luoiiiber  of  a  fraternal  society  holding  a  benefit  certi(ic:i1c  li:is 
such  an  interest  in  the  enforcement  of  the  certificate  as  entith's  liiin 
to  innintain  an  Mction  to  recover  damages  for  its  re[ni(liation. 

O'Neill  vs.  Supreme  Council  American  Legion  of  Honor,  Feby..  1904. 
70  N.  J.  L.  410. 

Precedent  Conditions  Dissolved  by  Repudiation. 

When  a  certificate  is  repudiated  during  the  life  of  a  member, 
he  need  not  continue  payment  of  assessments  or  otherwise  preserve 
his  good  standing  in  the  organization  in  order  to  entitle  him  to  sue 
for  damages.  Repudiation  absolves  the  injured  juu-ty  from  further 
perfornifUice  of  conditions  precedent. 

O'Nfill  vs.  Supreme  Council  American  Legion  of  Honor.  Feby.,  1904, 
70  N.  J.  L.  410. 

After-enacted  Laws — Must  be  Reasonable. 

Where  a  certificate  is  conditioned  upon  a  compliance  of  the  mem- 
ber with  all  laws  of  the  society  in  force  at  the  date  of  its  issuance, 
or  tluit  m;iy  be  thereafter  enacted,  such  condition  must  be  construed 
as  referring  only  to  reasonable  hy-laws  and  amendments,  adopted 
in  furtherance  of  the  contract,  and  not  to  sucli  as  would  overthrow 
it  or  materiallv  alter  its  terms. 


O'Neill  vs.  Supreme  Council  American  Legion  of  Honor,  Feby.,  1904, 
70  N.  J.  L.  410. 


Time  Limit  to  Sue  Waived  by  Repudiation, 

An  action  brought  for  damages  for  the  repudiation  of  a  contract 
is  not  subject  to  the  time  limitation  contaiued  therein. 


694  FRATERNAL    SOCIETY    LAW 

O'Neill  vs.  Supreme  Council  American  Legion  of  Honor,  Feby.,  1904, 
70  N.  J.  L.  410. 

Beneficiary,  Heirs  of  Beneficiary. 

The  charter  of  a  society  provided  that  its  olijeet  was  to  establish 
a  benefit  fund  for  the  families  or  dependents  of  members  as  they 
might  direct,  and  a  by-law  of  the  society  declared  that  on  the  death 
of  one  or  more  beneficiaries  prior  to  the  death  of  the  member,  if  any 
change  should  not  have  been  made,  the  share  or  shares  to  which  such 
beneficiaries  would  have  been  entitled,  shall  be  paid  to  the  bene- 
ficiary's legal  representative  to  be  distributed  to  his  or  her  heirs 
at  law.  In  passing  upon  such  a  contract  the  court  held  that  where 
the  member  died  after  the  death  of  his  wife  who  was  named  as  his 
beneficiary  without  having  appointed  a  new  beneficiary,  the  heirs 
of  the  wife  at  the  time  of  the  member's  death  were  entitled  to 
the  fund. 

Anderson  vs.  the  Supreme  Council  Catholic  Benevolent  Legion,  April, 
1905,  69  N.  J.  E.  176. 

Ante  Nuptial  Parol  Contract  void. 

An  ante  nuptial  parol  agreement  by  a  husband  to  make  the  wife 
his  beneficiary  in  his  certificate  is  void  under  the  provisions  of  the 
statute  of  frauds  that  an  agreement  made  in  consideration  of  mar- 
riage must  be  reduced  to  writing  and  signed. 

Penn  R.  R.  Co.  vs.  Warren.  .June,  1905.  69  N.  J.  E.  706. 

Beneficiary,  Incompetent  not  Helped  by  Society's  Interpleader. 

AVhere  a  member  intended  and  attempted  to  substitute  a  bene- 
ficiary who  did  not  comply  with  the  provisions  of  the  laws,  the  sub- 
stituted beneficiary  was  not  entitled  to  the  fund,  although  the  society 
had  paid  it  into  court. 

Penn  R.  R.  Co.  vs.  Warren,  June,  1905,  69  N.  J.  E.  706. 


THE    STATE    OF    NEW    JERSEY  695 

Unlawfully  Expelled  Member  Entitled  to  Mandamus. 

A  member  of  a  society  who  has  been  expelled  from  membership 
by  a  tribunal  not  authorized  by  the  constitution  and  laws  of  the 
society  and  from  whose  decision  no  appeal  is  provided,  is  entitled  to 
the  writ  of  mandamus  to  secure  a  reinstatement  in  the  society. 

Jennings  vs.   Supreme  Lodge  Order  of  Shepherds.   November,   1901, 
67  N.  J.  L.  126. 

Unlawful  Expulsion,  Rights  of  Member. 

The  constitution  of  a  society  prescribed  the  penalty  of  expulsion 
against  members  who  should  impugn  the  honor  or  name  of  the 
society,  either  in  word  or  deed,  or  who  should  talk  against  the  so- 
ciety thus  staining  the  good  name  and  honor  of  the  same.  Two 
members  were  appointed  upon  a  committee  to  defend  certain  suits 
against  the  society  in  the  civil  courts.  The  suits  were  lost  by  the 
society.  A  motion  was  then  made  to  expel  the  two  members  on 
account  of  the  loss  of  the  two  suits,  and  in  the  case  of  one  of  the 
two,  on  account  of  his  disorderly  manner  in  pressing  a  motion  for 
sick  benefits  for  his  brother,  and  his  refusal  to  cease  talking  when 
oi'dered  to  do  so,  held  that  the  charges  gave  no  jurisdiction  for  the 
expulsion,  and  that  the  members  so  expelled  should  be  reinstated. 

Radice  vs.  Italian  American  Society.  November.  1901.  67  N.  J.  L.  196. 

Evidence — Proper  Way  to  Prove  Laws. 

The  laws  of  a  fraternal  societj'^  cannot  be  proven  by  the  testi- 
mony of  a  member  with  a  printed  book  produced  by  him  containing 
the  supposed  laws  in  force  at  the  particular  date.  The  court  said 
"it  is  too  plain  for  argument,  that,  in  order  to  vary  the  existing 
contract,  strict  proof  of  the  enactment  of  the  law  claimed  to  have 
such  effect,  is  requisite.  Proof  by  members  of  the  order  that  copies 
of  what  purported  to  be  the  laws  e.xtant  had  been  promulgated  could 
not  legally  stand  in  lieu  of  direct  proof  of  such  enactment." 

Herman    vs.    The    Supreme    Lodge    Knights    of    Pythias,    February, 
1901,  66  N.  J.  L.  77. 


696  FRATERNAL    SOCIETY    LAW 

Agency — Laws  Not  to  be  Waived. 

Where  the  laws  of  a  society  limit  the  appointment  of  its  officers 
in  the  scope  of  their  powers  and  duties,  and  forbid  the  alteration  or 
amendment  of  such  laws,  except  by  the  governing  body  in  the  mode 
therein  provided,  and  where  the  members  have  agreed  as  a  part  of 
their  contract  of  membership  to  strictly  compl.v  with  the  laws,  tlie 
officers  thereof  have  no  power  to  waive  the  provisions  of  such  laws 
as  relate  to  the  substance  of  the  contract  between  the  individual 
members  and  their  associates  in  their  corjiorate  capacity. 

Kocher   vs.    Supreme    Council    Catholic    Benevolent    Legion,    March, 
1901,  65  N.  J.  L.   649. 

Agency — Laws  Cannot  be  Waived  Except  Upon  Express  Authority 
— Member  Has  Notice  of  Laws. 

In  a  suit  by  the  beneficiary  of  a  member  to  recover  the  amount 
of  the  certificate,  proof  of  parol  declarations  of  the  secretary  of  the 
society  made  to  the  plaintiff  that  waived  the  payment  of  assess- 
ments for  death  benefits  required  by  the  laws  until  such  time  as 
she  could  find  out  whether  her  husband  was  dead  or  alive,  was  not 
competent.  The  court  said  ''in  the  present  case  the  plaintiff  is  not 
in  the  attitude  of  one  dealing  with  a  corporation  in  good  faith  and 
without  notice,  as  beneficiary  she  had  no  vested  interest  even  in  tlie 
benefit  certificate.  A  by-law  authorized  the  holder  of  it  to  change 
the  beneficiary  at  any  time.  She  was  recognized  perhaps,  as  an 
agent  of  her  husband  in  paying  the  assessment  and  she  could 
occupy  a  no  more  favorable  position  than  he  in  dealing  with  the 
corporation ;  and  he  having  been  a  charter  member  and  former 
president  of  the  subordinate  council,  must  be  held  to  have  been  aa- 
quainted  with  the  provision  of  the  constitution  .-iiul  by-laws  of  the 
society.  Besides,  it  is  a  general  principle  that  jiersons  entering 
mutual  companies  are  presumed  to  know  the  terms  of  the  charter 
and  by-laws  umlcr  which  tlicy  are  organized.  Nor  can  the  offices 
of  such  associations  dispense  with  the  terms  and  conditions  of  such 
charter  and  by-laws,  vinless  they  are  expressly  authorized  to  do  so." 

Radice  vs.  Italian  American  Society,  November,  1901,  67  N.  J.  L.  196. 


THE    STATE    OF    NEW    JERSEY  697 

By-laws — What  Not  Self-operative. 

Foi"  the  facts  in  a  case  where  it  was  held  that  a  by-law  providmg 
for  forfeitures  in  the  event  of  member's  failure  to  make  payments, 
was  not  self-operative ;  see 

American  Council  vs.  National  Council,  February,  1899,  63  N.  J.  L.  52. 


Suicide — Insufficient  Evidence. 

For  the  facts  in  a  case  where  it  was  alleged  that  a  member 
suicided,  but  the  court  held  that  the  evidence  was  insufficient  to 
show  such  fact,  there  being  no  evidence  except  the  declaration  by 
a  physician  contained  in  an  affidavit  procured  inwn  him  by  the 
s(K'iet\,  th;it  the  member  had  suicided;  see 

Supreme   Lodge   Knights   of   Honor   vs.   Jaggers.    June.    1898,   62   N. 
J.  L.  96. 

Right  of  Defense  Under  Laws  of  Society. 

A  by-law  which  provides  for  the  expulsion  of  a  member  without 
affording  au  opportunity  of  defense  against  the  charges  upon  which 
the  expulsion  is  based,  was  held  not  to  be  altogether  null  and  void, 
but  only  so  to  the  extent  that  it  deprives  such  member  of  a  hearing 
from  whicli  he  might  possibly  derive  a  benefit,  and  where  it  con- 
clusively appears  that  no  such  result  has  followed  its  enforcement, 
the  existence  of  such  by-law  will  not  be  held  to  invalidate  the  pro- 
ceedings taken. 

Berkhout  vs.   Supreme   Council  Roj-al    Arcanum.   April,   1899,   62  N. 
J,   L.   103. 

Courts  Have  Right  of  Review  Where  Contracts  Involved. 

As  to  the  claim  of  exclusive  right  of  a  societ.v  under  particular 
laws  to  determine  who  is  entitled  to  receive  the  benefit  due  upon  a 
member's  certificate  wnthout  any  suit  ngainst  the  society,  cannot  be 
maintained;  see 

Societa  Di  Mutuo  vs.   Paulina  Cenni,  March,  1899,   62  N.  J.  L.   652. 


698  FRATERKAL    SOCIETY    LAW 


THE 

TERRITORY  OF  NEW  MEXICO. 

CHAPTER    32. 

The  following  provisions  of  the  New  Mexico  Code  of  1905  so  far 
as  applicable  concern  fraternal  societies: 

Section  2114.  It  shall  be  the  duty  of  the  president  and  of  the 
vice-president  and  secretary  of  each  company  organized  under  this 
act  or  incorporated  under  any  laws  of  this  territory,  or  doing  busi- 
ness in  this  territory,  annually,  on  the  first  day  of  January  of  each 
year,  or  within  thirty  days  thereafter,  to  prepare  under  oath  and 
deposit  in  the  office  of  the  territorial  auditor,  a  full,  true  and  com- 
plete statement  of  the  condition  of  such  company  on  the  first  day 
of  the  month  preceding  that  in  which  such  statement  is  filed,  which 
last  statement  shall  exhibit  the  following  items  and  facts  in  the  fol- 
lowing form,  viz. : 

First.     The  amount  of  the  capital  stock  of  the  company. 

Second.     The  names  of  the  officers. 

Third.     The  name  of  the  company  and  where  located. 

Fourth.     The  amount  of  capital  stock  paid-up. 

Fifth.  The  property  or  assets  held  by  the  company,  specifying 
the  value,  as  near  as  may  be,  of  the  real  estate  owned  by  such  com- 
pany; the  amount  of  ca.sh  on  hand  and  deposited  in  banks  to  the 
credit  of  the  company,  and  in  what  bank  the  same  is  deposited; 
the  amount  of  moneys,  stocks  or  bonds  deposited  in  anj'  foreign 
country,  State  or  territory  of  the  United  States  for  the  special 
benefit  of  the  assured  therein;  the  amount  of  cash  in  the 
hands   of  agents   and    in  eoiu'se   of   transmission ;   the    amount   of 


THE    TERRITOHY    O/'    .V/vlT    MEXICO  (j99 

lojiiis  scciiri'd  liy  lirsl  iiuirtR'age  ou  i'r;il  csliitc.  willi  llii;  ivitc  (if  iii- 
tcri'sl  1  lici-cdii,  specifying  the  location  of  such  real  estate  and  its 
assessed  valuation;  the  amount  of  all  other  bonds  and  loans,  and 
how  secured,  with  the  rate  of  interest  thereon ;  the  amount  due 
the  company  on  which  judgment  has  been  ohtaiiu-d;  the  amount 
of  stock  of  this  territory,  of  the  United  States,  or  of  any  incorpo- 
rated city  of  this  territory,  and  of  any  othoi"  stock  owned  hy  tlie 
company,  specifying  the  amounts,  number  of  shares  and  par  and 
market  value  of  each  kind  of  stock;  the  amount  of  stock  held  hy 
each  company  as  collateral  security  for  loans,  with  amount  loaned 
on  eacli  kind  of  stock,  its  par  and  market  value;  the  amount  (if 
assessment  on  stock  and  premium  notes  paid  and  unpaid;  the 
amount  of  interest  actually  due  and  unpaid ;  all  other  securities  and 
their  value;  the  amount  for  which  premium  notes  have  been  given 
on  which  policies  have  been  issued. 

Sixth.  The  liabilities  of  such  com|iaiiy.  sjiecifyiug  the  losses  ad- 
justed and  due;  losses  adjusted  and  not  due;  losses  unadjusted; 
losses  in  suspense  and  the  cause  thereof;  losses  resisted  and  in  litiga- 
tion; dividends,  either  in  script  or  cash,  specifying  the  amount  of 
each  declared,  but  not  due:  dividends  declared  ami  due;  the  amount 
required  to  reinsure  all  outstanding  risks  on  the  basis  of  fifty  per 
cent,  of  the  premiums  on  all  unexpired  risks  under  one  year,  and 
pro  rata  on  all  risks  having  more  than  one  year  to  run;  the  amount 
due  banks  and  other  creditors;  the  amount  of  money  borrowed 
and  the  security  therefor;  all  other  claims  against  the  company. 

Seventh.  The  income  of  the  company  during  the  previous  year, 
specifying  the  amounts  received  for  premiums  exclusive  of  premium 
notes;  the  amount  of  premium  notes  received;  the  amount  received 
for  interest;  the  amount  received  for  assessment,  calls  on  stock 
or  notes  or  premium  notes;  the  amounts  received  from  all  other 
sources. 

Eighth.  The  expenditures  during  the  preceding  year,  specifying 
the  amount  of  losses  paid  during  said  term,  stating  how  much  of 
the  same  accrued  prior,  and  how  much  subsequent  to  the  date  of 
the  preceding  statement,  and  the  amount  at  which  losses  were  esti- 
mated in  such  preceding  statement;  the  amount  paid  for  dividends, 


700  FRATERNAL    SOCIETY    LAW 

the  amount  paid  fur  cunimissions,  salaries,  expenses  and  other 
charges  of  agents,  clerks  and  other  employes;  the  amount  paid  for 
salaries,  fees  and  other  charges  of  office  and  directors;  the  amount 
paid  for  local,  territorial,  national,  internal  revenue  and  other  taxes 
and  duties;  the  amount  jiaid  for  all  other  expenses,  expenditures, 
including  printing,  stationery,  rents,  furniture,  etc. 

Ninth.     The  largest  amount  insured  in  any  one  risk. 

Tenth.     The  amount  of  risks  during  the  year  then  ending. 

Eleventh.  The  amount  of  risks  in  force  having  less  than  one 
year  to  run. 

Twelfth.  The  amount  of  risks  in  force  having  more  than  one  and 
not  over  three  years  to  run. 

Thirteenth.  The  Mniount  of  risks  having  more  than  three  years 
to  run. 

Fourteenth.  The  following  question  must  be  answered,  viz.: 
Are  dividends  declared  on  premiums  received  from  risks  not  ter- 
minated? 

The  territorial  auditor  shall  withhold  the  certificate  of  authority 
from  any  such  company  neglecting  or  failing  to  comph*  with  the 
provisions  of  this  section.  (For  "Auditor"  read  "Superintendent." 
Sees.  28  and  18,  Laws  1905.) 

Section  25.  The  provisions  of  this  act  shall  not  be  construed  so 
as  to  prevent  any  fraternal,  religious  or  benevolent  society  from 
issuing  indemnity  to  an>-one  against  loss  by  death  or  accident  of 
and  of  its  members,  and  such  society  shall  imt  be  held  amenable 
under  or  governed  by  any  of  the  provisions  of  any  article  in  this 
act  pertaining  to  accident  or  life  insurance,  except  as  to  rendering 
an  annual  statement  of  the  condition  of  said  association  or  society. 
The  fee  for  filing  the  annual  statement  as  herein  nrovided  shall 
be  five  ($5)  dollars.  But  all  life  and  accident  associations  here- 
after organized  under  the  laws  of  this  territory  to  operate  on  the 
mutual  assessment  plan  shall  comply  with  all  the  ])rovisions  of 
this  act  so  far  as  applicable,  and  shall  be  under  the  full  supervision 
of  the  .superintendent  of  insurance.  All  such  companies  now  exist- 
ing shall  comply  with  this  law,  within  ninety  (00)  days  after  its 
approval,  and  thereafter  shall  be  sub.ieet  to  exaniiii.itioii :  shall  take 


THE    TERRITORY    OF    NEW    MEXICO  701 

out  certificates  of  autluirity   and    in   all    ways  (Mintcniplati'il    licrciti 
aud  be  under  the  direction  of  tlie  Insurance  De|)artnu'n1. 

The    following'    next    section    though    somewhat    eonllictiui::    with 
Section  211 -4  is  probably  cumulative: 

Section  18.  Every  insurance  company  doing  business  in  this  ter- 
ritory shall  on  or  before  the  1st  day  of  March  in  each  year,  render 
to  the  superintendent  of  insurance  a  report,  signed  and  sworn  to 
by  its  chief  officer,  of  its  condition  on  the  preceding  31st  day  of 
Uuceiuber.  which  shall  include  a  detailed  statement  of  .assets  and 
liabilities,  the  amount  and  character  of  its  business  transacted  and 
moneys  received  and  expended  during  the  year,  and  such  other 
information  as  the  superintendent  of  insurance  may  deem  neces- 
sary, and  shall  annually  and  at  such  other  times  as  the  superin- 
tendent may  require,  make  such  report  as  may  be  prescribed  by 
hiui  of  all  re-insurance  or  cessions  of  risks  or  liabilities  contracted 
for  or  al¥ected  by  it  in  any  manner  whatsoever  upon  property 
located  in  this  territoi-y,  such  return  to  be  verified  by  the  oath  of 
its  president  and  secretary,  of  a  company,  society,  association  or 
partnership  of  one  of  the  United,  States,  and  if  of  a  foreign  country 
by  the  oath  of  its  manager  in  the  United  States.  The  refusal  of 
any  such  company,  society,  association  or  partnership  to  make  such 
return  shall  be  presumptive  evidence  that  it  is  guilty  of  violating  the 
provisions  of  this  act,  prohibiting  re-insurance  of  risks  of  a  company 
not  authorized  to  do  business  in  this  territory. 

Section  16.  No  company  shall  transact  in  this  territory  any  insur- 
ance business  unless  it  shall  procure  from  the  superintendent  of 
insurance  a  certificate  stating  that  the  requirements  of  the  laws 
of  this  territory  have  been  complied  with,  and  authorizing  it  to 
do  business.  Said  certificate  shall  expire  on  the  last  day  of  Feb- 
ruary in  each  year,  and  must  be  renewed  annually.  Every  such 
company  shall  be  required  to  procure,  annually,  for  the  use  of  its 
agents  and  solicitors,  copies  of  such  certificate  of  authority,  and 
any  person  soliciting  business  for  any  company  authorized  to  trans- 
act business  in  this  territory  without  first  procuring  a  certificate 
from  the  superintendent  of  insurance,  shall  be  guilty  of  a  misde- 
meanor, aud,  upon  conviction  thereof,  shall  be  piuiished  by  a  fine  of 
one  hundred  dollars  for  each  and  every  offense. 


702  FRATER2'fAL    SOCIETY    LAW 

No  insurance  company  or  association  organized  by  any  other 
authority  than  the  Territory  of  New  Mexico  shall,  directly  or  in- 
directly, issue  policies,  take  risks  or  transact  business  in  the  terri- 
tory until  it  shall  have  first  ajjpointed,  in  writing,  the  superin- 
tendent of  insurance,  to  be  the  true  and  lawful  attorney  of  such 
company  or  association  in  and  for  this  territory,  upon  whom  all 
lawful  processes  in  any  action  or  proceeding  against  the  comjiany 
may  be  served  with  the  same  effect  as  if  the  company  existed  in 
this  territorj'.  Said  power  of  attorney  shall  sti|tulat;'  ;ind  agree, 
upon  the  part  of  the  compauj'.  that  any  lawful  process  against 
the  company  wliich  served  on  said  altoriu-y  shall  be  of  the  saiue 
legal  force  and  validity  as  if  served  upon  the  company,  and  that 
the  authority  shall  continue  in  force  so  long  as  any  liability  re- 
mains outstanding  against  the  company  in  this  territory.  A  cer- 
tificate of  such  appointment,  duly  certified  and  authenticated,  shall 
be  filed  in  the  office  of  the  superintendent  of  insurance,  and  copies 
certified  b.v  him  shall  be  deemed  sufficient  evidence ;  service  ujton 
such  attorney  shall  be  deemed  sufficient  service  u]ion  the  principal. 

"Whenever  lawful  process  against  any  insurance  company  shall 
be  served  upon  the  superintendent  nf  insurance,  he  shall  forth- 
with forward  a  copy  of  the  process  served  on  him.  b.y  mail,  post- 
paid, and  directed  to  the  secretarv  of  the  eompan.v.  or.  in  ease 
of  companies  of  foreign  eountrir's.  to  the  i-esident  manager  in  this 
countrj^;  and  shall  also  forward  a  co]iy  thereof  to  the  general  agent 
of  the  said  company  in  this  territory.  For  each  copy  of  process 
the  superintendent  of  insurance  shall  collect  the' sum  of  two  ($2) 
dollars,  which  shall  be  paid  by  the  plaintiff  at  the  time  of  such 
service,  the  same  to  be  recovered  by  hini  as  ]>art  of  the  taxable 
cost,  if  he  prevails  in  the  suit. 

Section  17.  No  insurance  company,  not  incorporated  or  organized 
under  the  law  of  this  territory,  shall  transact  any  insurance  busi- 
ness in  this  territory  unless  it  shall  first  file  in  the  office  of  the 
superintendent  of  insurance  a  duly  certified  copy  of  its  charter, 
or  articles  of  incorporation,  or  deed  of  settlement,  together  wilh 
a  statement,  under  oath,  of  the  president  and  secretary,  or  other 
chief  officer  of  said  company,  showing  the  condition  of  affairs  of 
such  company  on  the  31st  day  of  December  next  preceding  the 


THE    TERRITORY    OF    XEW   MEXICO  703 

date  of  such  oath.  The  statement  shall  be  in  the  same  form  and 
shall  set  forth  the  same  i)articulars  as  the  annual  statement  re- 
quired by  this  act,  and  shall,  also,  before  permission  is  given  to 
transact  business  and  before  the  renewal  of  its  certificate  of  au- 
thority, file  a  certificate  signed  by  its  prcsi(l<'n(  or  chief  officer  to  the 
effect  that  all  the  provisions  of  this  act  are  accepted  by  it  as 
a  part  of  the  conditions  of  its  ris'ht  and  authority  to  transact 
business  in  this  territory:  Provided,  That  insurance  companies 
complying  with  the  provisions  of  this  section  shall  not  be  required 
to  comply  with  Section  1,  of  Chapter  65  of  the  Acts  of  the  Thirty- 
fifth  Legislative  Assembly  of  the  Territory  of  New  Mexico,  en- 
titled "An  Act  to  regulate  the  admission  of  foreign  corporations 
and  providing  a  penalty  for  corporations  I'.iiliiig  to  eoiiipl\-  with 
the  law,"  ;ii .proved  March  14,  1903. 

Assignment  Valid — Not  Wagering  Contract. 

A  life  insurance  contract  providing  for  the  payment  of  a  certain 
sum,  which  is  assigned  absolutely  by  the  insured  to  his  creditor  for 
the  cancellation  of  a  debt  less  than  one-half  the  amount  of  the  in- 
surance contract,  was  held  not  a  wagering  policy  or  a  speculative 
risk,  where  at  the  time  of  the  death  of  the  insured  the  assignee  had 
paid  on  the  insurance  contract  to  keep  it  in  force,  including  the 
amount  originally  paid  to  the  member  and  also  other  payments  made, 
a  sum  amounting  to  nearly  the  face  of  the  contract. 

Givens  vs.  Veeder,  October.  1S97,  9  N.  M.  256. 

Who  Is  Real  Party  in  Interest  in  Suit  on  Contract. 

Where  a  deceased  administrator  had  in  his  lifetime  as  such  admin- 
istrator collected  a  life  insurance  contract  made  payable  to  the  ex- 
ecutor, administrator,  or  assigns  of  the  deceased  member,  the  bene- 
ficiary of  the  contract  is  the  real  party  in  interest  and  a  suit  may  be 
brought  on  the  same  against  the  sureties  upon  the  administrator's 
bond  to  recover  proceeds  collected  upon  the  certificate. 

Conway  vs.  Parker.  April,  1902,  n  N.  M.  419. 


704  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  NEW  YORK. 

CHAPTER  33. 

(The  Section  numbers  employed  correspond  to  those  in  "The 
Insurance  Laws  of  New  ^'nrk,  !!)()(). "') 

Section  230.     Incorporation. 

Nine  or  more  persons  may  become  an  incorporated  fraternal  bene- 
ficiary society,  order  or  association  for  the  relief  by  insurance,  upon 
the  mutual  or  assessment  plan,  of  members  of  beneficiaries,  in  case 
of  sickness,  disability  or  death,  by  filing  in  the  office  of  the  superin- 
tendent of  insurance  a  declaration  executed  and  acknowledged  liy 
each  of  them,  stating  their  intention  to  form  a  fraternal  beneficiary 
society,  order  or  association  for  the  purposes  above  named,  the 
name  of  the  proposed  society,  order  or  association,  the  mode  in 
which  its  corporate  powers  are  to  be  executed,  the  name  and  official 
title  of  the  officers,  trustees,  directors,  representative  or  other  per- 
son, by  whatsoever  name  or  title  designated,  who  are  to  have  and 
exercise  the  general  control  and  management  of  its  affairs  and 
funds,  who  shall  be  elected  after  the  fii'st  year  by  representatives 
chosen  by  subordinate  lodges,  councils  or  bodies  who  shall  be  mem- 
bers of  such  society,  order  or  association.  There  shall  be  endorsed 
upon  such  declaration  or  annexed  thereto,  and  forming  a  part 
thereof,  the  swoi'u  statenu^nt  of  at  least  three  of  the  subscribers 
thereto,  that  two  hundred  persons  eligible  under  the  proposed  laws 
of  such  society,  order  or  association  to  nuunbership  therein  have  in 
good  faith  made  application  in  writing  for  membership. 


THE    STATE    OF    NEW    YORK  705 

If  all  the  requirements  of  law  have  been  complied  with,  the  super- 
intendent shall  thereupon  file  such  declaration  and  cause  it  to  be 
recorded  with  the  certificate  of  the  attorney-general  in  a  book  to 
be  kept  for  that  purpose,  and  shall  deliver  to  such  society,  order  or 
association  a  certified  copy  of  the  papers  so  recorded  in  his  otfice, 
together  with  a  license  or  certificate  of  the  superintendent  to  such 
society,  order  or  association,  as  proposed  in  the  declaration. 
No  such  society,  order  or  association  shall  transact  the  business 
of  insurance  in  this  State  until  at  least  two  hundred  persons  have 
subscribed  in  writing  to  be  beneficiary  members  therein  in  the 
aggregate  amount  of  at  least  four  hundred  thousand  dollars,  and 
have  each  ])aid  in  one  full  assessment  in  cash  amounting  to  at  least 
one  per  centum  thereof,  nor  until  the  superintendent  of  insurance 
shall  have  further  certified  that  it  has  comjilied  with  the  provisions 
of  this  chapter  and  is  authorized  to  transact  business  in  this  State. 

Section  231.    Reincorporation  of  Existing  Fraternities. 

Any  mutual  benefit  fraternity,  as  defined  by  this  article,  and  in- 
corporated under  the  laws  of  this  State,  may  reincorporate  under 
the  (irovisions  of  this  chapter  by  filing  with  the  superintendent  a 
declaration  adopted  by  the  governing  bod.y  of  such  corporation  and 
executed  and  duly  acknowledged  by  the  president,  secretary,  treas- 
urer and  trustees,  with  the  seal  thereof,  which  shall  contain  the 
name  of  the  corporation,  the  mode  in  which  the  corporate  powers 
granted  by  this  article  are  to  be  exercised,  the  name  and  official 
title  of  the  officers,  trustees,  directors,  representatives  or  other  per- 
sons by  whatsoever  name  or  title  designated,  who  are  to  have  and 
exercise  the  general  control  and  management  of  its  affairs  and  of 
its  funds,  and  the  mode  of  their  selection,  and  the  place  where  its 
office  within  the  State  is  located.  Such  declaration  shall  have  in- 
dorsed thereon  or  annexed  thereto  as  a  part  thereof,  the  sworn  state- 
ment of  three  of  such  officers  that  at  least  two  hundred  persons  are 
bona  fide  members  of  such  society,  order  or  association,  and  that  the 
total  beneficiary  amount  is  not  less  than  four  hundred  thousand 
dollars,  and  that  one  full  assessment  has  been  paid  in. 

The  superintendent  shall  file  such  declaration  and  .statement,  and 
|l  refer  same  to  the  attorney-general  for  his  certificate  of  conformity 
4.^ 


706  FRATERNAL    SOCIETY    LAW 

and  appi'oval,  and  upon  the  return  thereof  the  superintendent  shall 
record  the  same  with  the  cei'tificate  of  the  attorney-general  in  his 
office,  and  deliver  to  such  corporation,  association  or  society  a  cer- 
tified copy  of  the  papers  so  recorded,  together  with  his  license  to 
carry  on  the  work  of  a  fraternal  beneficiary  society,  order  or  asso- 
ciation as  proposed  in  such  declaration.  Upon  filing  the  same  in 
the  office  of  the  clerk  of  the  county  wherein  the  principal  ofSce  for 
the  transaction  of  its  bvisiness  is  located,  it  shall  thereupon  be  duly 
incorporated  under  the  provisions  of  this  article.  No  existing  fra- 
ternal beneficiary  society,  order  or  association  shall  be  required  to 
reincorporate  under  the  provisions  of  this  article. 

Section  232.    Foreign  Societies. 

No  fraternal  beneficiary  societj%  order  or  association  organized 
under  the  laws  of  any  other  State  or  territory  of  the  United  States, 
or  of  the  District  of  Columbia  or  foreign  countries,  or  any  volun- 
tary fraternal  beneficiary  society,  order  or  association  hnving  its  prin- 
cipal place  of  business  outside  of  the  State  of  New  York  and  not  now 
doing  business  in  this  State,  shall  transact  business  herein  until 
it  has  filed  with  the  superintendent  of  insurance  a  certificate  under 
oath  of  its  principal  officers  that  at  least  two  hundred  persons  Have 
subscribed  in  writing  to  be  beneficiary  members  therein  with  a  total 
beneficiary  amount  not  less  than  four  hundred  thousand  dollars,  and 
that  they  have  paid  in  one  full  assessment  in  cash  amounting  to  at 
least  one  per  cent  thereof,  nor  until  such  society,  order  or  associa- 
tion has  received  from  the  superintendent  a  certificate  of  aiithority 
to  transact  business  in  this  State  in  duplicate,  one  of  which  shall 
be  filed  in  the  office  of  the  superintendent. 

The  superintendent  shall  revoke  such  certificate  at  any  time  that 
it  shall  appear  from  the  annual  report  of  such  order,  society  or  asso- 
ciation to  the  insurance  department,  or  from  an.v  other  satisfactory 
evidence,  that  the  membership  of  such  society,  order  or  associa- 
tion has  diminished  below  two  hundred,  representing  an  insurance 
of  four  hundred  thousand  dollars,  and  no  such  society,  order  or 
association  shall  thereafter  continue  to  do  business  in  this  State. 

In  addition  to  the  foregoing  requirements  and  provisions,  and 
before  the  issuance  of  a  certificate  of  authority,  to  transact  business, 


THE    STATE    OF   NEW    YORK  707 

as  lierein  pi'ovi(_loil,  Id  jiiiy  soeioty,  order  or  association,  licrein  de- 
scribed, organized  undrr  I  he  laws  of  any  foreign  country,  it  shall 
be  the  duty  of  the  superintendent  of  insurance,  either  personally  or 
by  some  person  or  persons  appointed  by  him,  to  visit  and  examine 
tliuroughly  and  fully  as  he  may  deem  necessary,  and  as  he  may 
determine,  into  the  condition,  business  methods,  character  and  in- 
vestment of  funds  and  the  affairs  generally  of  any  such  society, 
order  or  association  making  application  to  him  for  license,  and  such 
supcriutendent  is  authorized  to  make  such  examination  as  often  as 
he  maj-  deem  necessary;  and  the  expense  of  every  such  examination 
shall  be  paid  by  the  society,  order  or  association  examined  to  such 
an  amount  as  the  superintendent  shall  determine;  but  when  such 
examination  shall  be  made  by  the  sujierintentlcnt  ])ersonally.  or 
by  one  or  more  of  the  regular  clerks  in  his  department,  no  charge 
shall  be  made  for  such  examination,  except  for  the  necessary  travel- 
ing and  other  expenses.  And  whenever  it  shall  apjiear,  to  the  said 
superintendent,  from  an  examination  made  as  aforesaid,  and  from 
the  statement,  report  or  certificate  filed  or  submitted  by  any  such 
society,  order  or  association  as  herein  provided,  that  it  is  coilducting 
its  affairs  in  a  safe  and  authorized  manner  and  has  in  all  respects 
complied  with  the  r(>quirements  of  this  section,  he  shall  issue  to 
such  society,  order  ov  association,  a  certificate  under  his  hand  and 
seal,  permitting  it  to  transact  business  in  this  State  for  the  term  of 
one  year  from  the  date  thereof. 

But  whenever  it  shall  appear  to  the  said  superintendent,  from  any 
examination  made,  or  from  any  report  submitted  or  certificate 
filed,  or  from  any  reliable  information  otherwise  obtained,  that  such 
licensee,  in  addition  to  any  other  violation  in  this  section  provided, 
is  conducting  its  business  in  an  unsafe  and  unauthorized  manner, 
he  shall,  by  an  order  under  his  hand  and  seal  of  office,  addressed  to 
such  licensee,  or  its  proper  officers,  direct  said  licensee  to  discontinue 
such  unsafe  or  unlawful  i)ractice.  and  to  conform  to  the  require- 
ments of  its  charter  and  of  law.  and  to  ])rovide  for  the  safety  and 
si^MU'ity  of  its  transactions,  and  for  the  failure  to  make  any  report 
herein  required,  or  to  comply  with  such  order,  or  whenever  it  shall 
appear  to  said  superintendent  that  it  is  unsafe  or  inexpedien«t  for 
any  such   licensee   to   continue   the   transaction   of  business   in   this 


708  FRATERNAL    SOCIETY    LAW 

ytate,  he  shall  forthwith  revoke  the  liceuse  of  such  licensee ;  aud 
service  of  any  such  order  of  revocation  ma.v  be  made  personally 
upon  any  of  the  officers  of  such  licensee  within  this  State,  or  by 
mail,  addressed  to  such  licensee  or  its  officers,  at  its  principal  place 
of  business  in  the  country  wherein  it  is  organized,  or  such  service 
may  be  made  by  ])ublieation  thereof  for  six  successive  days  in  the 
State  paper,  published  in  the  city  of  Albany,  and  after  the  comple- 
tion of  such  service,  no  such  licensee  shall  thereafter  continue  to  do 
business  in  this  State. 

The  examination  herein  provided  for,  however,  shall  not  be  neces- 
sary in  any  case  where  such  society,  order  or  association  is  under 
the  supervision  and  examination  of  the  insurance  department  of  the 
country  of  its  organization  or  incorporation,  and  in  case  the  super- 
intendent of  this  State  shall  be  satisfied  from  the  report  of  said 
home  department,  that  such  society,  order  or  association  is  conduct- 
ing its  business  in  a  safe  and  lawful  manner. 

Section  233.    Mutual  Benefit  Fraternities. 

All  beneficiary  societies,  orders  or  associations,  whether  voluntary 
or  incorporated  under  the  laws  of  this  State  or  any  other  State  or 
territory  of  the  United  States  or  of  the  District  of  Columbia,  doing 
any  kind  of  business  in  this  State  authorized  by  this  article,  and  the 
members  of  wliicli  are  proposed,  elected  and  initiated  in  subordinate 
lodges  or  councils  or  other  bodies,  by  whatever  other  name  known, 
aecoi'ding  to  the  constitution,  laws,  rules,  regulations,  rites  and 
ceremonies  of  such  societies,  orders  or  associations,  respectively,  now 
existing  in  this  State,  or  which  may  be  hereafter  instituted,  organ- 
ized or  authorized  to  do  business,  in  this  State,  are  declared  to  be 
mutual  benefit  fraternities  and  exempt  from  the  provisions  of  the 
other  insurance  laws  of  the  State,  and  shall  be  sub.iect  only  to  the 
provisions  of  this  article,  and  such  provisions  of  article  one  of  this 
chapter  as  ma.v  be  specially  applicable  thereto. 

Section  234.     Constitution  and  By-laws. 

The  incorjiorators,  trustees,  directin's.  iiicmln-rs  or  representa- 
tives, as  the  case  may  be,  of  iiii>'  fi';itiTii:iI  bi'neficinry  socii>ty.  order 


THE    STATE    OF    NEW    YOllK  709 

or  nssociation,  organized  iimler  this  nrlirlc  di'  luulcr  any  act  re,  r  il  'il 
l)y  this  chapter,  or  under  any  special  act,  shall  have  the  power  to 
make  such  constitution  and  by-laws,  not  inconsistent  with  law.  as 
ni.iy  be  deemed  necessary  for  the  government  of  its  officers  and  the 
conduct  of  its  affairs,  and  to  alter  and  amend  the  same  when  ueees- 
saiy.  When  so  made,  altered  and  amended,  they  shall  be  the  law 
governing-  such  society,  order  or  association,  and  its  officers,  sub- 
ordinate lodges,  councils  or  bodies  and  the  members  in  their  rela- 
tions to  such  society,  order  or  association  in  all  their  acts;  and  they 
and  their  successors  may  have  a  common  seal,  and  may  change  and 
alter  the  same.  Every  such  society,  order  or  ass()ciati(m  transact- 
ing business  under  this  act  or  within  this  State,  shall  file  with  the 
superintendent  of  insurance  a  duly  certified  copy  of  its  constitution 
and  laws  and  of  all  amendments  of  or  additions  thereto,  within 
ninety  days  after  the  enactment  of  the  same.  Such  certified  copies 
or  duly  certified  transcripts  therefrom  shall  be  competent  evidence 
in  any  court  of  this  State.  Printed  copies  of  such  constitution  and 
laws  and  all  additions  or  amendments  thereto,  certified  by  the  secre- 
tary or  similar  officer  of  the  association,  shall  be  also  prima  facie 
evidence  thereof  in  any  court,  provided  they  shall  have  been  first  so 
filed. 

Section  235.    Agreements  for  Benefits. 

Any  such  fraternal  beneficiary  society,  order  or  association,  may 
make  such  promise  or  agreement  with  its  members  for  the  payment 
of  benefits  to  a  member  or  others  dependent  upon  him.  or  a  bene- 
ficiary designated  by  him  in  case  of  sickness,  disability  or  death.  It 
shall  not  issue  any  certificate  or  make  any  promise  or  agreement 
exju-ess  or  implied,  for  the  payment  of  any  greater  sum  of  money 
than  one  assessment  npan  all  its  members  will  realize  at  the  time 
of  issuing  such  certificate  or  the  making  of  such  promise  or  agree- 
ment. No  fraternal  beneficiary  society,  order  or  association  shall 
hereafter  make  any  promise  or  agreement  with  its  members  for  the 
payment  of  money  upon  the  expiration  of  a  fixed  period  in  ease  a 
death  loss  has  not  been  incurred  before  the  expiration  of  such 
period,  except,  that  any  society,  order  or  association,  incorporated 
under  the  provisions  of  this   article,   which,   on   the   first   day  of 


710  FRATERNAL    SOCIETY    LAW 

March,  nineteen  hundred  and  three,  had  in  force  agreements  with 
its  members  for  the  payment  of  money  upon  the  expiration  of  a 
fixed  period  not  less  than  five  years  in  case  a  death  loss  has  not  been 
incurred  before  the  expiration  of  such  period,  in  accordance  with 
its  constitution,  laws,  rules  and  regulations,  may  continue  to  make 
such  agreements  with  its  members. 

Section  236.    Revenues. 

Any  such  fraternal  society,  order  or  association,  may  derive  such 
money  or  such  benefit,  charitj%  relief  or  aid  fund  from  voluntary 
donations,  or  from  admission  fees,  dues  and  assessments,  collected 
or  to  be  collected  from  members  thereof,  in  manner  and  form  as 
may  be  provided  by  its  constitution,  laAvs,  rules  and  regulations.  It 
shall  not,  nor  shall  any  officer  thereof,  use  any  money  collected  or 
received  for  the  payiiient  of  beneficiary  claims  for  any  other  pur- 
pose. 

Section  237.    Annual  Report. 

Every  such  fraternal  society,  order  or  association  as  defined  by 
this  article,  and  doing  business  within  this  State,  shall,  ou  or  before 
-the  first  day  of  March  of  each  year,  make  and  file  with  the  super- 
intendent of  insurance  of  this  State  a  report  of  its  affairs  and  opera- 
tions during  the  year  ending  on  the  thirty-first  day  of  December 
immediately  preceding,  which  annual  report  shall  be  in  lieu  of  all 
other  i-eports  required  by  any  other  law.  Such  report  shall  be  upon 
blank  forms  to  be  provided  by  the  superintendent,  and  shall  be  veri- 
fied under  oath  by  the  duly  authorized  officers  of  such  society,  oi'der 
or  association,  and  shall  be  published,  or  the  substance  thereof,  in 
his  annual  report  by  the  superintendent,  under  a  separate  part  en- 
titled "fraternal  beneficiary  societies,  orders  or  associations,"  and 
shall  contain  answers  to  the  following  questions : 

1.  Nvimber  of  certificates  issued  during  the  year,  or  members 
admitted. 

2.  Amount  of  indemnity  effected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred.. 

4.  Number  of  losses  or  benefit  liabilities  paid. 


THE    STATE    OF   NEW    YORK  711 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representatives 
or  heirs. 

7.  Nmnber  and  kind  nf  (claims  I'or  which  assessments  have  been 
made. 

8.  Number  and  kinds  of  claims  compromised  or  resisted,  and  brief 
statement  of  reasons. 

9.  Does  society  chargi>  annual  or  other  periodical  dues  or  admis- 
sion fees? 

10.  How  much  on  each  one  thousand  dollars  annually  or  per 
eajiita,  as  the  case  may  be  ? 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 

12.  State  total  amount  of  salaries  paid  to  officers. 

13.  Does  society  guarantee,  in  its  certificates,  fixed  amounts  to  be 
paid,  regardless  of  amount  realized  from  assessments,  dues  and  ad- 
mission fees  and  donations? 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  svich 
guaranty. 

15.  Has  the  society  a  reserve  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested  ? 

17.  Has  the  society  more  than  one  class? 

18.  If  so,  how  many,  and  the  amount  of  indemnity  in  each? 

19.  Number  of  members  in  each  class. 

20.  If  voluntary  so  state,  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  state  under  what 
law  and  at  what  time,  giving  chapter  and  year  and  date  of  passage 
of  the  act. 

22.  If  organized  under  the  laws  of  any  other  State,  territory 
or  District  of  Columbia,  state  such  fact  and  the  date  or  organization, 
giving  chapter  and  year  and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  membership  lapsed  during  the  year. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more  than 
one  class,  number  in  each  class. 

The  superintendent  of  insurance  is  authorized  and  empowered  to 
address  any  additional  inquiries  to  any  of  the  societies,  orders  or 


712  FRATERNAL    SOCIETY    LAW 

associations  referred  to  in  this  article  iu  relation  to  its  doings  or 
condition  or  any  other  matters  connected  with  its  transactions  rela- 
tive to  the  business  contemplated  by  this  article,  and  such  ofSeers 
of  the  society,  order  or  association  as  the  superintendent  may  re- 
quire, shall  properly  reph'  in  writing,  under  oath,  to  all  such  in- 
quiries. 

All  such  societies,  orders  or  associations,  together  with  their 
books,  papers  and  vouchers,  shall  be  subject  to  visitation  and  in- 
spection hy  the  superintendent  of  insurance,  or  such  person  or  per- 
sons as  he  may  at  any  time  designate.  Any  such  society,  order  or 
association  refusing  or  neglecting  to  make  such  report  may,  upon 
the  suit  of  the  superintendent,  be  enjoined  by  the  supreme  court 
from  carrying  on  any  business  until  such  report  shall  be  made,  and 
until  the  costs  of  such  action  shall  be  paid.  Such  superintendent 
must  within  thirty  days  after  failure  to  make  such  report,  or  in 
case  au.y  such  society,  order  or  association  shall  exceed  its  powers 
or  shall  conduct  its  business  fraudulently,  or  fail  to  comply  with  any 
of  the  provisions  of  this  article,  give  notice  in  writing  to  the  at- 
torney-general who  must  immediately  commence  an  action  against 
the  delinquent  society.  The  annual  report  of  the  superinteudent 
of  insurance  shall  be  in  lieu  of  all  other  reports  required  by  any 
other  law.  Any  supreme  grand  or  subordinate  officer,  trustee,  or 
agent  of  any  such  mutual  fraternal  beneticiary  society,  order  or 
association,  subject  to  any  of  the  provisions  of  this  chapter,  who 
shall  neglect  or  refuse  to  comply  with  such  provisions  or  who  shall 
make  in  any  report  or  statement,  any  intentionally  false  or  fraudu- 
lent statement;  or  shall  refuse  to  permit  the  superintendent  of  in- 
surance or  any  examiner  duly  authorized  by  him  for  that  purpose, 
to  make  an  examination  of  its  condition  and  business,  books,  papers 
and  vouchers,  and  any  person  who  shall  act  within  this  State  as 
supreme  grand  or  subordinate  officer,  trustee,  agent,  solicitor  or 
collector  for  any  such  fraternal  beneficiary  society,  order  or  asso- 
ciation, which  shall  have  failed,  neglected  or  refused  to  comply  with 
or  violate  any  of  the  provisions  of  this  chapter,  or  shall  have  failed 
or  neglected  to  procure  from  the  superintendent,  the  certificate  of 
authority  to  transact  business  in  this  State  required  by  law,  shall 
forfeit  to  the  people  of  the  State  the  sum  of  one  hundred  dollai's  for 


THE    STATE    OF   NEW    YORK  713 

every  such  offense.  If  an  exaiiiinatiou  of  the  condition  and  business 
of  any  such  fraternal  beneficiary  society,  order  or  association  trans- 
acliiig  business  in  this  State  shall  be  prevented  by  such  refusal,  the 
superintendent  of  insurance  shall  revoke  the  certificate  of  authoi-ity 
issued  to  such  fraternal  beneficiai-y  society,  order  or  association; 
and  it  shall  thereafter  be  unlawful  for  it  to  do  business  in  this  State 
until  it  shall  have  issued  to  it  a  new  certificate  of  authority  author- 
izing it  to  continue  business  in  this  State. 

Section  238.     Rights  of  Members — Exemptions — Notice  of  Assess- 
ment. 

Membership  in  any  such  society,  order  or  association  shall  give  to 
the  member  the  right  at  any  time,  upon  the  consent  of  such  society, 
order  or  association,  in  the  manner  and  form  prescribed  by  its  by- 
hiws,  to  make  a  change  in  its  payee  or  payees,  beneficiary  or  bene- 
ficiaries, without  requiring  the  consent  of  such  payees  or  bene- 
ficiaries. All  money  or  other  benefit,  charity,  relief,  or  aid.  to  be 
paid,  provided  or  rendered,  or  which  has  heretofore  been  paid,  or 
which  shall  hereafter  be  paid,  provided  or  rendered,  by  any  such 
society,  order  or  association,  whether  voluntary  or  incorporated 
under  this  article  or  any  other  law,  shall  be  exempt  from  execu- 
tion, and  shall  not  be  liable  to  be  seized,  taken  or  appropriated  by 
any  legal  or  equitable  process,  to  pay  any  debt  or  liability  of  a  mem- 
ber, beneficiary,  or  beneficiaries  of  a  member.  All  notices  of  assess- 
ment made  upon  its  lodges,  councils,  branches  or  members,  or  any 
of  them  bj^  any  such  society,  order  or  association,  shall  truly  state 
the  cause  and  purpose  of  the  assessment,  and  what  portion  or  amount 
thereof,  if  any,  is  to  be  used  for  the  payment  of  other  than  bene- 
ficiary claims.  An  affidavit  made  by  any  officer  of  such  society, 
order  or  association  that  such  notice  was  mailed,  stating  the  date  of 
mailing,  shall  be  presumptive  evidence  thereof. 

Section  239.    Application  of  Article. 

All  fraternal  beneficiary  societies,  orders  or  associations,  as  defined 
by  section  two  hundred  and  thirty-three  of  this  chapter,  shall  be 
subject  to  all  the  provisions  of  this  article,  except  sections  two  huu- 


I 


714  FRATERNAL    SOCIETY    LAW 

dred  and  thirty  to  two  hundred  and  thirty-two,  both  inclusive,  to- 
gether with  their  members  and  beneficiaries,  and  entitled  to  all  the 
rights,  privileges    and  benefits  of  this  article. 

This  article  shall  not  apply  to  any  corporation,  society  or  asso- 
ciation carrying  on  the  business  of  life,  health,  casualty  or  accident 
insurance  for  profit  or  gain,  but  it  shall  only  apply  to  fraternal 
beneficiary  societies,  orders  or  associations  as  defined  in  this  article. 
This  article  shall  not  effect  any  subordinate  lodge  or  branch  of  any 
such  fraternal  beneficiary  society,  order  or  association,  except  as 
provided  in  section  two  hundred  and  thirty-four,  nor  apply  to  the 
grand  or  suboi'dinate  lodges  of  the  Independent  Order  of  Odd  Fel- 
lows as  they  now  exist,  or  any  grand  or  subordinate  lodge  or  other 
body  of  Free  and  Accepted  Masons,  nor  to  the  grand  or  any  sub- 
ordinate lodge  of  the  Knights  of  Pythias,  exclusive  of  the  Endow- 
ment Rank. 

Section  240.    Reinsurance. 

No  domestic  association  shall  reinsure  with  or  transfer  its  mem- 
bership or  funds  to  any  association  not  authorized  by  the  superin- 
tendent of  insurance  to  transact  business  in  this  State.  Nor  shall 
any  svich  association  reinsure  with  or  transfer  its  membership  or 
funds  to  any  licensed  association,  unless  the  said  contract  of  trans- 
fer or  reinsurance  is  submitted  to  and  approved  by  a  two-thirds  vote 
of  the  members  of  each  association  present  at  meetings  called  to 
consider  the  same,  of  which  meetings  written  or  printed  notice  shall 
be  mailed  to  each  certificate  holder  at  least  thirty  days  before  the 
date  fixed  for  said  meeting;  nor  unless  the  said  contract  of  transfer 
or  reinsurance  is  first  submitted  to  and  approved  by  the  superin- 
tendent of  insurance. 

Benefits  Exempt  From  Creditors'  Claims. 

When  a  fund  due  under  a  certificate  has  been  paid  over  to  the 
beneficiary,  the  exemption  of  the  statute  in  favor  of  such  fund  and 
preventing  it  from  being  taken  for  debt,  no  longer  attaches  to  the 
fund,  and  it  may  then  be  seized  under  lawful  process  by  a  creditor 
of  the  beneficiary. 

Bull  vs.  Case,  Feb.,  1901,  1G5  N.  Y.  578. 


THE    STATE    OF    NEW    YORK  716 

Proofs  of  Death,  Suit  to  be  Brought  in  Limited  Time. 

Where  a  contract  of  insurance  provides  that  liability  of  the  so- 
ciety shall  not  mature  until  90  days  from  the  date  of  receipt  of 
satisfactory  proofs  of  death,  and  that  an  action  to  enforce  pay- 
ment must  be  commenced  within  six  mouths  from  the  date  of  the 
maturity  of  the  claim,  which  time  does  not  commence  until  the  re- 
jection of  the  claim  upon  the  proofs  presented  by  the  beneficiary, 
it  is  not  a  defense  to  an  action  commenced  within  six  months  after 
sucli  rejection  that  the  claim  was  rejected  before  presentation  of 
the  proofs,  and  that  the  action  was  commenced  within  six  months 
thereafter.    Affirming  115  Appellate  Division  855. 

Munn  vs.  Masonic  Life  Association,  November,  1907,  1S9  New  York 
486. 

Beneficiary,  When  Interest  Vested  and  Cannot  be  Defeated  by  Desig- 
nation of  New  Beneficiary. 

Where  a  certificate  is  taken  out  for  the  benefit  of  a  person  named 
therein  and  delivered  to  her  under  an  agreement  made  between  her 
and  the  member,  whereby  she  was  to  take  care  of  the  member  dur- 
ing his  lifetime,  which  agreement  has  been  fully  performed,  the  in- 
sured cannot  destroy  the  rights  of  such  bciicticiary  without  her  c-on- 
sent  by  cancelling  her  designatimi  as  benetieiary,  and  procuring  a 
new  certificate  to  be  issued  to  another  beneficiary,  notwithstanding 
tile  liy-laws  of  the  society  provide  that  a  change  of  beneficiary  may 
be  made  at  any  time  and  as  often  as  required  by  the  member,  with- 
out the  consent  of  any  existing  beneficiary,  sueh  provision  relates 
to  a  case  in  which  the  designation  has  been  made  volnut'ririly.  but 
has  no  application  to  a  case  where  the  beneficiary  has  acquired 
rights  under  the  certificate  for  a  valuable  consideration.  Keverring 
111  Appellate  Division  87. 

Stronge  vs.   Supreme  Lodge  Knights  of  Pytliias,  October,  1907,  189 
New  York  346. 

Beneficiary,  Sister-in-law  May  be  Named  as. 

A  contention  that  a  beneficiarv  as  a  sister-in-law  of  the  insured 


716  FRATERNAL    SOCIETY    LAW 

■vvas  not  a  proper  person  to  be  designated  as  beneficiar3%  is  unten- 
able as  a  defense  where  the  certificate  upon  its  face  disclosed  her 
relationship,  and  the  society  having  issued  the  certificate  to  her 
has  received  the  payments  required  of  the  member  thereunder. 

Stronge  vs.   Supreme  Lodge  Knights  of  Pythias,  October,   1907,  189 
New  York  346. 

Initiation,  Injuries  During  Charged  to  Society  Where  Local  Body 
Working  Under  Ritual  Prescribed  by  Society. 

The  Supreme  Tent  of  the  Knights  of  the  jMaecabees  of  the  World 
having  superintending  control  over  all  subordinate  tents,  and  having 
enacted  by-laws  requiring  the  officers  of  such  tents  to  carry  out  the 
directions  of  the  ritual  established  for  the  lodge  work  by  it.  is 
liable  for  personal  in.iuries  sustained  by  a  member  during  his  initia- 
tion into  the  subordinate  tent  in  consequence  of  the  acts  of  the 
officers  thereof  who  were  by  such  ritual  required  to  do  the  very 
acts  which  produced  the  injury,  and  under  such  circumstances  the 
officers  and  members  conducting  the  initiation  ceremonies  act  as 
the  lawfully  constituted  agents  of  the  Supreme  Tent  within  the 
scope  of  the  authorit.v  vested  in  them.  Reversing  114  Appellate 
Division  906. 

Thompson   vs.   Supreme   Tent  Knights   of  Maccabees  of  the   World, 
October.  1907.   189  New  York  294. 

After-enacted  Laws,  How  far  Binding  on  Contracts  Outstanding. 

While  a  society  may  so  amend  its  by-laws  as  to  make  reasonable 
changes  in  the  mi'tbo  Is  nf  administration,  the  manner  of  conduct- 
ing its  business,  and  the  like,  no  change  can  be  made  which  will 
deprive  the  member  of  a  substantial  right  either  expressly  or  im- 
pliedly given  him  by  the  contract.  It  is  beyond  the  power  of  the 
legislature,  as  well  as  the  societv  to  avoid  the  obligation  of  a  con- 
tract.    Confirming  109  Appellate  Division  919. 

Ayers  vs.  Grand  Lodge  A.  0.  U.  W..  April.  1907.  1S8  New  York  280. 


THE    STATU    OF    NEW    YORK  717 

After-enacted  Occupation  Laws  Not  Valid. 

Payment  of  a  cei-tifieate  upon  which  duos  had  been  paid  by  the 
member  and  accepted  by  the  society  to  the  time  of  his  death  cannot 
be  avoided  upon  the  ground  that  the  member  at  tlie  time  of  his 
death  was,  and  for  a  few  months  prior  thereto,  had  been  engaged  in 
the  hotel  business  in  violation  of  a  by-law  adopted  by  the  society, 
without  notice  to  the  member,  more  than  a  year  after  his  certificate 
was  issued,  prohibiting  any  certificate  holder  from  selling  liquors 
at  retail,  and  declaring  the  certificate  of  anyone  engaged  in  such 
business  void  for  violation  thereof,  where  in  the  certificate,  in  ques- 
tion, the  application  therefor,  nor  the  by-laws  under  which  it  was 
issued  there  was  no  restriction  as  to  the  business  in  which  the  mem- 
ber might  engage.     Confirming  109  Appellate  Division  919. 

Ayers  vs.  Grand  Lodge  A.  0.  U.  W.,  April,  1907,  188  New  York  280. 

Member  Has  Vested  Right  to  Follow  Any  Occupation  Not  Prohibited. 

The  fact  that  in  the  application  upon  which  the  certificate  was 
issued  the  member  agreed  to  comply  with  all  laws,  regulations,  and 
requirements  of  the  society,  which  were  then  or  which  might  there- 
after be  enacted, — there  being  no  reservation  in  the  laws  of  the 
right  to  amend  them  so  as  to  restrict  an  occupation  or  business  of 
the  member,  without  the  consent  of  the  member,-— and  which  made 
it  without  this  consent  beyond  the  power  of  the  society  to  make 
amendments  so  as  to  avoid  contracts  upon  any  ground  or  to  re- 
duce the  amount  of  the  benefits,  the  fact  that  the  member  had  the 
right  to  engage  in  any  lawful  business  was  a  vested  right  and  the 
member  could  not  be  deprived  of  it  without  his  voluntary  consent. 
Confirming  109  Appellate  Division  919. 

Ayers  vs.  Grand  Lodge  A.  0.  U.  W.,  April,  1907,  188  New  York  280;. 

After-enacted  Laws — When  Not  Valid. 

A  member  in  his  application  agreed  "to  conform  in  all  respects 
to  the  laws,  rules,  and  usages  of  the  order  now  in  force,  or  which 
may  hereafter  be  adopted."     The  certificate  issued  obligated  the 


718  FRATERNAL    SOCIETY    LAW 

society  to  pay  the  death  benefit,  upon  satisfactory  proof  of  death 
"in  consideration  of  the  full  compliance  with  all  the  by-laws  now 
existing  or  hereafter  adopted."  At  the  time  the  certificate  w.as 
issued,  there  was  no  provision  in  the  laws  limiting  the  time  in  which 
an  action  might  be  maintained  against  the  society  upon  the  cer- 
tificate; but  subsequently,  and  before  the  death  of  the  member, 
the  by-laws  were  amended  so  as  to  provide  a  short  statute  of  limita- 
tions of  one  year  for  such  an  action.  Held,  that  such  amended  by- 
law did  not  apply  to  the  certificate  in  question,  and  judgment  against 
the  society  was  affirmed  May,  1905,  in  Butler  vs.  Supreme  Council 
American  Legion  of  Honor,  105  N.  Y.  Appellate  Division  164,  and 
on  appeal  to  the  Court  of  Appeals,  the  judgment  of  the  Appellate 
Division  was  affirmed  without  an  opinion  being  written. 

Butler   vs.    Supreme   Council    American    Legion    of   Honor,   October, 
1906.  1S6  N.  Y.  514. 

Suicide,  After-enacted  Laws  Not  Valid  as  to. 

At  the  time  when  a  member  was  admitted  to  the  society  and  re- 
ceived a  certificate,  the  by-laws  provided  that  no  benefit  should  be 
paid  when  death  was  the  result  of  suicide  within  one  year  after  the 
admission  of  the  member,  whether  the  suicide  was  sane  or  insane. 

Subsequently  the  by-laws  were  amended  so  as  to  provide  that  no 
benefits  should  be  paid  when  death  resulted  from  suicide  within  five 
years  after  the  member's  admission,  whether  the  member  was  sane 
or  insane,  and  provided  further  that  in  case  of  siteh  suicide  all  as- 
sessments paid  in  would  be  repaid  to  the  beneficiary,  which  anuniut 
should  be  the  full  amount  that  could  be  claimed;  and  subsequently 
the  by-laws  were  again  amended  so  as  to  provide  that  no  benefits 
should  be  paid  if  death  was  the  result  of  suicide,  whether  the  mem- 
ber was  sane  or  insane,  providing  that  in  case  of  suicide,  twice  the 
amount  of  all  assessments  paid  should  be  repaid  to  the  beneficiary, 
w-hich  amount  should  not  exceed  the  face  of  the  certificate,  and 
should  be  the  full  :i.;iiHi;:t  tlial  (•(iiihl  Iw  claimed.  It  was  held  th;it 
a  beneficiary  under  the  certificate  in  question  was  entitled  to  recover 
the  face  thereof,  although  said  certificate  was  in  conflict  with  the 
amendments,  and  that  the  memlier  could  not  be  said  to  have  eon- 


THE    tSTATE    OF    NEW    YORK  719 

sented  to  the  amendments  because  the  representative  of  the  subordi- 
nate lodge  to  which  he  belonged  was  in  attendance  on  the  Supreme 
Tent  when  the  amendment  was  made.  Affirming  opinion  of  Appel- 
late Division,  July,  1904,  96  N.  Y.  App.  Div.  491. 

Fargo  vs.  Supreme  Tent  Knights  of  the  Maccabees  of  the  World, 
June,  1906,  185  N.  Y.  578. 

Misstatements  in  Application,  Evidence  Under. 

In  an  action  upon  a  certificate  the  principal  issues  litigated  were 
(1)  as  to  whether  the  answers  to  questions  in  the  application  relat- 
ing to  the  member's  use  of  intoxicating  liquors  were  made  by  him, 
or  were  written  without  his  knowledge  or  consent  by  the  medical 
examiner;  (2)  if  made  by  the  member,  whether  they  were  true,  there 
being  evidence  that  he  was  an  habitual  user  of  intoxicating  liquors, 
and  had  been  convicted  of  public  intoxication,  and  confined  in  prison 
therefor.  The  refusal  of  the  trial  court  to  permit  the  plaintiff,  who 
had  sworn  that  the  answers  were  made  without  the  knowledge  or 
consent  of  the  member,  and  that  she  had  never  seen  him  intoxi- 
cated, to  testify  on  cross-examination,  as  to  whether  she  had  seen 
him  drink,  constituted  a  reversible  error.  The  facts  in  the  case  are 
interesting  by  reason  of  the  same  alone,  and  not  because  of  any  prin- 
ciple of  law  discussed.    Reversing  98  App.  Div.  634. 

Rossenbach  vs.  Supreme  Court  Independent  Order  of  Foresters,  Feb- 
ruary, 1906,  184  N.  Y.  92. 

Suspension,  Mandate  Will  Not  Restore  Member  Under. 

The  Court  has  no  power  to  issue  a  mandatory  injunction  to  secure 
the  reinstatement  of  a  suspended  member  of  a  voltmtary  associa- 
tion, and  in  the  proceeding  to  punish  as  for  civil  contempt  the  vio- 
lation of  such  injunction,  the  lack  of  authority  to  grant  it  is  a  com- 
plete defense.    Reversing  108  App.  Div.  357. 

Bachman  vs.  Harrington,  April,  1906,  184  N.  Y.  458. 

After-enacted  Laws — When  Not  Valid. 

At  the  time  when  a  member  joined  the  society  there  were  three 


720  FRATERNAL    SOCIETY    LAW 

classes  of  membership,  and  upon  the  death  of  a  member  of  the  class 
to  which  Evans  belonged,  he  became  liable  for  an  assessment  for  $1, 
and  in  case  of  his  death,  his  beneficiary  became  entitled  to  have  the 
latter  assessment  against  all  the  members  of  Evans'  class,  and  to 
receive  the  same  to  not  exceed  the  amount  specified  in  the  certifi- 
cate. Subsequent  to  Evans's  admission,  the  by-laws  were  amended 
so  that  all  three  classes  were  consolidated  into  one  class,  and  the 
assessment  thereafter  to  be  paid  upon  the  death  of  a  member  was 
graded  according  to  the  age  of  the  member  paying  the  same,  and 
by  subsequent  payments  the  rates  of  the  Evans  contract  were  in- 
creased so  that  he  was  required  to  pay  $2.40  per  month.  The  only 
question  in  the  case  was  as  to  whether  the  amendments  of  the  laws 
affected  Evans's  certificate,  who  had  agreed  in  his  application  to 
be  bound  by  all  the  rules  and  laws  in  force  at  the  date  of  his  ad- 
mission and  those  subsequently  enacted.  The  Court  held  that  the 
after-enacted  laws  did  not  affect  Evans's  certificate.  Reversing  94 
App.  Div.  541. 

Evans  vs.   Southern  Tier  Masonic  Relief  Ass'n.  October,   1905.  182 
N.  Y.  453. 

Beneficiary,  Laws  Restricting  Class  Waived. 

A  certificate  issued  by  a  society,  designating  as  beneficiaiy  one 
who  was  neither  a  relative  nor  a  dependent  upon  the  member  was 
held  to  be  due  and  payable  to  the  beneficiary  therein  named  upon 
the  death  of  the  member,  notwithstanding  the  provisions  of  the  by- 
laws of  the  society  restricting  the  designation  of  beneficiaries  to 
relatives  or  dependents  only,  where  it  appears  that  an  act  of  the 
legislature  under  which  the  society  was  incorporated  authorized 
other  persons  to  be  named  as  beneficiaries  of  the  society,  and  where 
the  society,  with  the  knowledge  that  the  beneficiary  was  not  within 
the  classes  embraced  in  the  by-law,  accepted  the  member  thereunder 
and  received  his  dues.    Affirming  90  App.  Div.  613. 

Coiilson  vs.  Flynn,   February,  1905,  181   N.  Y.  62. 

Beneficiary,  When  Ultra  Vires  Act  in  Naming  One  is  Waived. 
The  plea  of  ultra  vires  cannot  lie  r.-iised  by  a  socioty  where  in  an 


TUB    STATE    OF    NEW    YORK  721 

action  brought  against  it  by  the  brothers  and  sisters  of  a  member 
to  recover  On  a  certificate  issued  to  him,  payable  to  a  beneficiary, 
not  related  to  nor  tlependent  upon  him,  but  who  had  interpleaded 
in  the  case,  the  society  having  paid  the  money  into  court  and  not 
defending.  Held,  that  the  plaintiffs  cannot  raise  the  question  of 
ultra  vires,  in  as  much  as  they  had  no  certificate  at  all  and  no  con- 
tract themselves  for  any  claim  whatever.  Affirming  90  App.  Div. 
613. 

Coulson  vs.  Flynn.  February,  1905,  ISl  N.  Y.  62. 

Contract  With  Foreign  Society  May  be  New  York  Contract. 

A  society  organized  under  the  Federal  Statutes  as  a  District  of 
Columbia  corporation,  with  its  general  offices  in  Chicago,  issued  to 
a  resident  of  the  city  of  New  York  a  certificate,  upon  which  was 
printed  "I  hereby  accept  this  certificate  of  membership,  subject  to 
all  the  conditions  therein  contained,"  which  was  signed  by  the 
applicant,  and  dated  in  New  York  City,  was  held  to  be  a  New  York 
contract,  and  to  be  enforced  according  to  the  laws  of  that  state.  Af- 
firming 82  App.  Div.  359. 

Meyer  vs.  Supreme  Lodge  Knights  of  Pythias,  March,  1904,  178  N.  Y. 
63. 

Physician,  Knowledge  of  Privileged,  Waivers  of  Statutory  Privilege 
Void  Unless  Made  in  Court. 

The  provisions  of  Sections  834  and  836  of  the  Code  of  Civil  Pro- 
cedure prohibiting  the  disclosure  by  a  physician  of  professional  in- 
formation, unless  they  have  been  expressly  waived  upon  the  trial 
by  the  personal  representatives  of  the  deceased,  apply  to  a  benefit 
certificate,  although  it  contains  a  waiver  of  them  made  by  the  appli- 
cant over  his  signature.    Affirming  82  App.  Div.  359. 

Meyer  vs.  Supreme  Lodge  Knights  of  Pythias,  March.  1904,  ITS  N.  Y. 
63. 

Physician  and  Patient,  When  Relation  Exists. 

When  one  who  is  sick  unto  death  is  in  fact  treated  by  a  physician 

46 


722  FRATERNAL    SOCIETY    LAW 

as  a  patient,  even  against  his  will,  he  becomes  the  patient  of  that 
physician  by  operation  of  law;  and  the  same  is  true  of  one  who  is 
unconscious  and  unable  to  speak  for  himself.  Therefore,  any  in- 
formation which  is  necessary  to  enable  such  physician  to  act  as 
such,  is  acquired  "in  attending  a  patient  in  a  professional  capacity" 
within  the  meaning  of  Section  83i  of  the  Code  of  Civil  Procedure, 
and  is  protected  from  disclosure,  and  waivers  made  by  the  member 
in  his  application  cannot  be  enforced  at  the  trial  of  a  suit  brought 
upon  the  certificate,  over  the  objection  of  the  plaintiff.  Affirming 
82  App.  Div.  359. 

Meyer  vs.  Supreme  Lodge  Knights  of  Pythias.  March,  1904.  178  N.  Y. 
63. 

Compromise,  Award  and  Satisfaction. 

Where  there  was  an  honest  dispute  between  the  beneficiaries 
named  in  a  certificate  and  the  officers  of  the  society  as  to  the  amount 
due  under  the  certificate,  the  beneficiaries  claiming  the  amount 
named  in  the  certificate  was  due,  and  the  society  insisting  that  this 
amount  was  reduced  to  a  certain  sum  by  an  amendment  to  the  by- 
laws of  the  society  adopted  subsequent  to  the  issuing  of  the  cer- 
tificate, and  refusing  to  pay  that  sum  until  the  beneficiaries  should 
sign  a  certificate  acknowledging  the  payment  of  the  full  amount  due 
thereunder  and  surrendering  it  for  cancellation,  the  signing  and 
delivery  of  such  certificate  and  the  acceptance  by  them  of  the 
amount  tendered  by  the  society  is  conclusive  and  sufficient  evi- 
dence of  their  intention  to  discharge  and  cancel  the  certificate,  and 
there  was  a  settlement  ^vith  full  knowledge  of  the  situation  and 
constitutes  an  accord  and  satisfaction  in  law.  Reversing  82  App. 
Div.  617. 

Simons  vs.  Supreme  Council  American  Legion  of  Honor,  April,  1904, 
178  N.  Y.  263. 

Misrepresentation  in  Application  Avoids  Contract. 

An  applicant  was  asked  in  his  application  the  following  question: 
"Have  you  ever  been  rejected  by  any  life  insurance  company  or 


THE    STATE    OF    NEW    YUltlC  72;5 

association?"  He  answered  the  question  "no,"  but  had  been  previ- 
ously rejected  by  another  tent  of  the  same  society,  to  which  he  was 
making-  aiiplieation,  wliich  reject idii  was  known  to  him.  Held  that 
the  answer  is  untrue  and  fraudulent  and  avoids  the  certificate  issued 
to  such  applicant,  where  he  had  stipulated  in  his  application  therefor 
that  any  untrue  or  fraudulent  answers  should  vitiate  the  certificate 
and  forfeit  all  payments  made  thereon.    Reversing  78  App.  Div.  18. 

Alden  vs.   Supreme  Tent  Knights  of  the   Maccabees  of  the  World, 
June,   1904,   178  N.   Y.   535. 

After-enacted  Laws  When  Valid. 

A  subsequently  enacted  by-law  was  held  not  to  affect  a  certificate 
in  force  at  the  time  of  its  enactment,  in  as  much  as  it  changed  ma- 
terially the  contract  between  the  society  and  the  member  holding 
the  certificate  with  respect  to  the  benefits  that  he  would  receive  by 
reason  of  accident,  notwithstanding  there  was  an  agreement  in  the 
application  by  which  the  member  was  to  be  bound  by  the  laws  in 
force  and  those  subsequently  enacted.  The  Court  said:  "If  the 
certificate  had  provided  that  the  payments  therein  specified  should 
be  subject  to  such  modification  as  to  amount,  terms,  and  conditions  of 
payment  and  contingencies  in  which  the  same  were  payable  as  the 
endowment  laws  of  the  order  from  time  to  time  might  provide,  the 
amendments  would  be  applicable  to  exi,sting  members.  But  I  think 
that  nothing  less  explicit  than  this  appearing  in  the  certificate  itself 
should  be  effectual  for  such  a  purpose.  Fairness  to  persons  joining 
the  order  require  such  plain  dealing."  The  case  reported  in  74 
App.  Div.  527  was  affirmed. 

Beach  vs.   Supreme  Tent  Knights  of  the  Maccabees  of  the  World, 
January,  1904,  177  N.  Y.  100. 

Agency,  Provisions  Against  Power  to  Bind  Society  Void. 

The  provision  of  a  society's  laws  charging  the  members  with  the 
defaults  of  ofSce'rs  in  failing  to  pay  over  moneys  received  from 
members  is  held  to  be  unreasonable  and  void,  and  to  have  no  effect 
upon  the  status  of  members  otherwise  in  good  standing.  Affirming 
66  App.  Div.  259. 


724  FRATERNAL    SOCIETY    LAW 

Brown   vs.   Supreme  Court   Ind.   0.  of  Foresters,  October,   1903,  176 
N.  Y.  132. 

Beneficiary^ — Change  When  Effective. 

A  member  who  has  received  a  certificate  entitling  him  to  par- 
ticipate in  its  beneficiary  fund,  in  which  certificate  his  wife  is  desig- 
nated as  beneficiary,  is  not  deprived  of  his  right  subsequently  to 
procure  a  certificate  to  be  issued  to  another  beneficiary  by  the  fact 
that  his  wife  who  had  obtained  possession  of  the  certificate,  wrong- 
fully withholds  it,  when  he  complies  with  the  laws  for  making  a 
change  of  beneficiary,  except  that  of  surrendering  the  original  cer- 
tificate. Equity  will  aid  the  subsequent  beneficiary  and  regard  that 
as  done  which  ought  to  have  been  done.    Affirming  66  App.  Div.  623. 

Lahey  vs.  Lahey,  March,  1903,  174  N.  Y.  146. 

After-enacted  Law  Cutting  Down  Benefit  Void. 

A  by-law  passed  subsequent  to  the  issuance  of  a  certificate  wherein 
it  was  agreed  to  pay  to  the  member's  beneficiary  a  sum  not  exceed- 
ing $5,000,  reducing  the  amount  of  said  benefit  to  be  paid  to  $2,000, 
was  held  to  be  unreasonable  and  void  so  far  as  said  certificate  was 
concerned,  and  that  the  subsequent  refusal  of  the  society  to  receive 
dues  and  assessments  upon  the  certificate  upon  the  basis  of  $5,000 
and  to  recognize  such  contract  as  binding  upon  it,  did  not  constitute 
such  breach  of  contract  as  to  entitle  the  member  to  maintain  an 
action  for  the  recovery  of  damages  therefor,  by  reason  of  the  fact 
that  the  amended  by-law  was  wholly  ineffectual  to  deprive  the  mem- 
ber of  any  rights.    Reversing  69  App,  Div.  616. 

Langan  vs.  Supreme  Council  Am.    Legion    of    Honor,    April.    1903, 
174   N.   Y.   266, 

After-enacted  Laws  When  Valid,  Effect  of  Same, 

Under  an  express  agreement  by  a  member  to  comply  with  "All 
the  laws,  rules,  regulations  and  requirements  now  in  force  or  that 
may  be  hereafter  enacted,"  by-laws  thereafter  regularly  adopted 
become  retrospective  as  well  as  prospective  in  their  operation,  ex- 


I 


THE    STATE    OF   Af/i'M'    YORK  725 

ci'j)t  as  to  rights  wliicli  liiive  become  fixed  or  vested  hy  the  terms 
of  the  original  contract.     Opinion  fin  Apii.  Div.  448  modified. 

Shlpman  vs.  Protected  Home  Circle,  April,  1903,  174  N.  Y.  398. 

After-enacted  Suicide  Law  Invalid. 

Where  the  contract  is  silent  upon  the  subject  of  scif-dcst  ruction  by 
a  member  while  insane,  death  from  that  cause  is  clearly  within  its 
terms,  and  having  acquired  a  fixed  and  vested  right  to  insurance 
covering  that  risk,  no  subsequent  amendment  of  the  b.y-laws  can 
aft'ect  that  right  without  the  express  consent  of  the  insured.  Opinion 
66  App.  Div.  448  modified. 

Shipman  vs.  Protected  Home  Circle,  April,  1903,  174  N.  Y.  398. 

Payment  to  Trustee  No  Release  Against  Real  Claimant. 

The  pa.vment  by  a  supreme  lodge  of  the  amount  of  a  benefit  due 
under  a  certificate,  which  payment  is  made  to  a  trustee,  does  not 
release  the  society  from  liability  to  pay  the  fund  to  the  proper 
beneficiaries  in  an  action  against  it  brought  by  the  member's  ad- 
ministratrix for  the  real  beneficiaries'  benefit. 

Pteifer   vs.   Supreme   Lodge   Bohemian   Society,   February,   1903,   173 
N.  Y.  418. 

Heirs — What  is  Meant  by  Use  of  Term. 

The  word  "heirs"  as  used  in  the  b.v-laws  of  a  society  in  descri- 
bing beneficiaries  is  not  to  be  regarded  as  used  in  a  strictl.v  technical 
sense  as  representing  persons  entitled  to  inherit  real  estate,  but 
rather  as  indicating  the  next  of  kin  of  the  deceased  member. 

Pfeifer  vs.   Supreme   Lodge  Bohemian   Society,   February,   1903,   173 
N.  Y.  418. 

After-enacted  Suicide  Law  Invalid, 

A  society  which  has  issued  a  certificate  under  which  it  promises 


726  FRATERNAL    SOCIETY    LAW 

indemnity  against  unintentional  self-destruction  after  one  year  of 
membership,  cannot,  by  subsequent  amendment  of  its  by-laws  pro- 
viding in  effect  that  self-destruction  while  insane  within  5  years 
from  the  date  of  the  contract  should  render  it  void,  deprive  the 
beneficiary  of  his  rights  under  the  contract  as  originally  made,  since 
such  amendment  is  held  to  be  vmreasonable.  The  Court  said :  "The 
division  line  between  proper  and  improper  amendments  and  the  au- 
thorities bearing  thereon  were  sufficiently  considered  in  this  case 
(Parish  vs.  N.  Y.  Produce  Exchange,  169  N.  Y.  34).  In  this  one 
it  suffices  in  conclusion  to  say  that  this  defendant  cannot,  by  amend- 
ment to  its  rules,  deprive  persons  already  insured  or  their  bene- 
ficiaries of  their  rights  under  contracts  of  insurance  in  the  event 
that  death  shall  ensue  from  specified  causes  necessarily  insured 
against  by  the  original  contract.  This  contract  insured  "Weber 
against  unintentional  self-destruction  after  one  year  and  defendant 
had  not  the  power  to  take  away  the  right  thus  secured  without 
his  consent."     Affirming  61  App.  Div.  613. 

Weber  vs.   Supreme  Tent  Knights  of  the  Maccabees  of  the  World, 
November,  1902,  172  N.  Y.  490. 

Beneficiary — Change  of  When  Valid. 

A  member  has  the  absolute  power  to  change  the  beneficiary  desig- 
nated in  his  certificate  by  complying  with  the  by-law  which  is  con- 
elusive  on  the  sulijeet,  and  which  provides  that  a  new  certificate 
shall  be  issued  upon  the  condition  that  the  member  asking  for  it 
shall  pay  the  sum  of  25  cents,  held,  that  another  beneficiary  can  bo 
named  only  by  strict  compliance  with  the  law. 

Fink  vs.  Fink,  June,   1902.  171  N.  Y.  616. 

Beneficiary — Changes  of  Provisions  for  in  Law  Exclusive. 

A  specific  bequest  of  a  death  benefit  due  under  a  certificate  by 
the  member  in  his  will  does  not  effect  a  change  of  beneficiary  named 
in  the  certificate  where  the  l;iws  do  not  so  provide,  and  the  method 
prescribed  by  tlirm  for  iiinkiiig  changes  is  hold  to  be  exclusive. 

Fink   vs.  Fink,  June,  1902.  171   N,  Y.   61  r,. 


THE    STATE    OF    NEW   YORK  727 

Agency  of  Medical  Examiner  Exclusively  of  Society  Regardless  of 
Contract  Provisions. 

While,  as  a  general  rule,  parties  have  the  right  to  make  such  con- 
tracts as  they  see  fit,  this  right  is  restricted  by  legislation,  public 
policy,  and  the  nature  of  things.  Thej'  cannot  stipulate  that  facts 
which  the  law  declares  establish  a  certain  relation  not  only  do  not 
establish  that  relation  but  establish  directlj'  the  opposite ;  and  the 
medical  examiner  of  a  company  is  agent  of  a  company  in  making  the 
examination,  taking  down  the  answers,  and  reporting  them  to  the 
company,  and  is  not  the  agent  of  the  applicant,  although  the  latter 
agrees  with  the  company  that  for  that  purpose  he  shall  be  deemed 
to  be  his  agent.  The  knowledge  of  the  examiner  thus  acquired,  his 
interpretation  of  the  answers  given,  and  his  errors  in  recording 
them  are  the  knowledge,  interpretation  and  errors  of  the  company 
itself,  which  is  estopped  from  taking  advantage  of  what  it  thus 
knows  and  what  it  thus  does  when  it  issues  a  contract  and  accepts 
the  payments  of  premiums  thereunder. 

Sternaman  vs.  Metropolitan  Life  Ins.  Co.,  Feb.,  1902,  170  N.  Y.  13, 
reversing  49  App.  Div.  473. 

Interpleader,  Settled  What  Questions. 

One  who  assists  in  procuring  an  order  of  interpleader  and  consents 
that  upon  payment  into  court  of  the  fund  in  controversy  he  is  to  be 
substituted  as  defendant,  cannot  raise  the  question  whether  the 
original  defendant  could  have  maintained  an  action  of  strict  inter- 
pleader. 

Hirsch  vs.  Mayer.  Jan.,  1901,  165  N.  Y.  236.,  affirming  31  App.  Div. 
627. 

Funds,  When  Not  Exempt  Prom  Seizure  for  Debt. 

The  provision  of  the  insurance  statutes  relating  to  fraternal  so- 
cieties providing  that  "all  money,  or  other  benefit,  charity,  relief, 
or  aid  to  be  paid,  provided  or  rendered  by  any  such  society,  order 
or  association,  whether  voluntary  or  incorporated,  under  this  article 
or  any  other  law,  shall  not  be  liable  to  be  seized,  taken  or  appro- 


728  FRATERNAL    SOCIETY    LAM' 

priated  by  any  legal  or  equitable  process  to  pay  any  debt  or  lia- 
bility of  a  member,  beneficiary  or  beneficiaries  of  a  member,"  does 
not  apply  in  the  case  of  money  which  has  been  actually  paid  over  and 
received  by  the  beneticiarj*.  and  therefore  a  security  representing 
a  part  of  such  money  is  liable  to  an  attachment  for  a  debt  of  the 
beneficiary. 

Bull  vs.  Case.  Feb..  1901.  165  N.  Y.  578.  affirming  41  App.  Div.  391. 

Death  Presumed  by  Absence,  Compromise  of  Claim  Valid  Though 
Member  be  Living. 

A  contract  by  which  the  beneficiary  under  a  certificate  upon  the 
life  of  a  member  who  has  not  been  heard  from  in  nine  years  and  is 
supposed  by  both  parties  to  be  dead,  agrees  with  the  society  to  settle 
and  discontinue  an  action  on  the  certificate  and  accept  an  absolute 
payment  of  a  portion  of  the  certificate,  which  is  to  be  paid  promptly 
and  not  returned  in  any  event,  and  that  the  balance  shall  be  placed 
in  the  hands  of  a  trustee  to  be  held  for  a  certain  period  and  re- 
turned to  the  society  if  it  produces  reasonable  proof  within  that 
time  that  the  member  is  living,  but  otherwise  to  be  paid  to  the  bene- 
ficiaries, entitles  the  latter  to  recover  the  amount  of  the  agreed 
cash  payment,  although  before  it  is  paid  over  the  member  is  proved 
to  be  living,  the  contract  being  not  enforcible  as  to  such  payment  on 
the  ground  that  there  was  a  mutual  mistake  as  to  the  material  fact 
of  the  supposed  death  of  the  member,  since  the  only  thing  which 
the  settlement  dealt  with  was  the  possibility  that  he  should  prove 
to  be  living,  and  the  discontinuance  of  the  certificate,  the  extension 
of  the  time  of  payment  of  a  part  of  the  claim,  and  the  compromise 
of  a  doubtful  claim  constitute  a  sufficient  consideration  for  the 
contract. 

Sears  vs.  Grand  Lodge  A.  0.  U.  W..  .Tune.  1900.  163  N.  Y.  374.  re- 
versing 24  App.  Div.  410. 

Ambiguous  Contracts  How  to  be  Construed. 

"Where  the  language  of  a  contract  is  so  ambiguous  as  to  render  it 
susceptible    of   two   interpretations,    it   should   be   construed   most 


THE    STATE    Oh'   NEW    YORK  729 

strongly  agaiust  the  soeiety,  since  the  latter  has  prepared  the  con- 
tract and  is  responsible  for  the  language  employed. 

Janneck   vs.   Metropolitan  Life   Ins.   Co.,   May,   1900.   162   N.   Y.   574. 
affirming  13  App.  Div.  514. 

Superintendent  of  Insurance,  Duties  of  Ministerial  Respecting  Issu- 
ance of  License. 

The  duties  of  the  Superintendent  of  Insurance  in  the  matter  of 
filing  articles  of  reincoi'poration  of  a  fraternal  society,  referring  them 
to  the  Attorne.y  General,  recordiiii;'  his  certificate  of  conformity  and 
approval,  and  delivering  same  to  the  corporation  together  with  the 
license  to  do  business  as  provided  for  by  the  insurance  statutes  of  the 
State,  are  purely  ministerial,  which  he  may  be  compelled  to  per- 
form b}^  mandamus. 

The  People  vs.  Payn,  Supt.  of  Insurance.  .Ian.,  1900,  161  N.  Y.  229, 
affirming  43  App.   Div.   621. 

Reincorporation,  Right  of. 

A  fraternal  society  duly  incorporated  under  the  laws  of  this  State 
has  an  absolute  legal  right  to  reincorporate  under  its  present  name, 
by  virtue  of  certain  sections  of  the  General  Corporation  Law,  which 
expressly  gives  this  privilege  to  corporations  formed  by  reincorpora- 
tion, reorganization,  or  consolidation,  or  upon  the  sale  of  the  prop- 
erty or  franchise  of  the  corporation. 

The  People  vs.  Payn.  S\uit.  ct  Insurance,  Jan.,  1900,   161  N.  Y.  229, 
affirming  43  App.  Div.  621. 

Officers,  Removal  of  at  Will. 

A  voluntary  unincorporated  society  without  articles,  constitution 
or  rules,  may  make  changes,  including  removal  without  notice  of  its 
president  or  other  officers  at  will  at  any  meeting  duly  held,  but  it 
cannot  expel  a  member  without  notice. 

Ostrom  vs.  Greene,  Jan.,  1900,  161  N.  Y.  353,  affirming  30  App.  Div. 
621. 


730  FRATERNAL    SOCIETY    LAW 

OflBcers,  Official  Actions  Presumed  to  be  Correct  and  Lawful. 

Where  the  charter  of  a  mutual  society  provides  that,  when  ascer- 
tained, each  polic.v  holder  shall  be  credited  with  an  equitable  share 
of  the  surplus,  and  that  the  earnings  and  receipts  over  and  above 
the  dividends,  losses  and  expenses  shall  be  accumulated,  the  question 
of  how  much  of  the  surplus  is  to  be  distributed  and  how  much  shall 
be  accumulated  for  the  securitj'  of  the  company  and  its  members, 
is  to  be  decided  by  the  officers  and  managers  in  the  exercise  of 
their  discretion,  having  in  view  the  present  and  future  contingencies 
of  the  business ;  and  in  the  absence  of  any  allegation  of  wrongdoing 
or  mistake  by  them,  their  determination  must  be  treated  as  proper, 
and  their  apportionment  of  the  surplus  is  prima  facie  to  be  regarded 
as  equitable. 

Greeff  vs.  Equitable  Life  Assurance  Society,  Oct.,  1S99,  160  N.  Y.  19. 
reversing  40  App.  Div.  ISO. 

Estoppel  and  Waiver,  Definition  of. 

In  the  absence  of  an  express  Avaiver,  at  least  some  of  the  ele- 
ments of  an  estoppel  must  exist,  the  insured  must  have  been  mislead 
by  some  act  of  the  insurer,  or  it  must,  after  a  knowledge  of  the 
breach,  have  done  something  which  could  only  be  done  by  virtue  of 
the  contract,  or  have  required  something  of  the  insured  which  be 
was  boimd  to  do  only  by  virtue  of  such  contract;  and  an  estoppel  or 
waiver  claimed  must  be  established  by  a  preponderance  of  the  evi- 
dence by  the  person  claiming 'same,  and  neither  an  estoppel  nor  a 
waiver  of  a  breach  of  the  condition  after  forfeiture  by  reason  there- 
of can  be  inferred  from  mere  silence  or  inaction. 

Gibson  vs.  The  Liverpool   &  London   &  Globe   Ins.  Co.,   June.  1899, 
159  N.  Y.  418,  affirming  10  App.  Div.  225. 

Assignment  of  Contract  Valid  When. 

It  is  the  doctrine  of  this  State  that  a  contract  of  insurance  taken 
out  by  the  insured  himself,  or  by  another  having  an  insurable  in- 
terest on  his  life,  in  good  faith  and  not  for  the  mere  purpose  of  as- 


THE    STATE    OF    NEW    YORK  731 

signment,  iiuiy  he  lawfully  assigned  to  one  having  no  insurable  iti- 
toi'pst  ill  the  life  of  the  insiTred,  and  that  when  the  assignment  is 
absolute  and  general  the  assignee  will  be  entitled  to  the  entire  pro- 
ceeds of  the  contract. 

Steinbach  vs.  Diepenbrock,  Jan.,  1899,  158  N.  Y.  24,  affirming  1  App. 
Div.  417. 

Contract,  Rights  Under — Measured  by  What. 

The  riyht.s  of  the  parties  to  a  death  claim  upon  tlie  funds  of  an  in- 
solvent fraternal  society  in  the  hands  of  a  receiver  api^ointed  in  an 
action  brought  by  the  Attorney  General  for  the  dissolution  of  the 
society  are  to  be  regarded  as  fixed  as  of  the  date  of  the  commence- 
ment of  the  Attorney  General's  action,  and  these  rights  are  measured 
by  the  contract  created  by  the  constitution,  by-laws,  and  certificate 
of  membership,  provided  the  same  were  authorized  by  law. 

The    People    vs.   Grand   Lodge   Empire   Order   of   Mutual   Aid.   Oct., 
1898,  156  N.  Y.  533,  affirming  S8  Hun.  621. 

Assessments  Being  Common  Burdens  of  All,  Preferences  in  Funds 
Not  Favored. 

When  the  whole  scheme  provided  by  the  laws  of  a  society  is  that 
a  fund  should  be  created  by  assessments,  which  after  it  came  into 
the  possession  of  the  society  was  to  be  appropriated  generally  to  the 
payment  of  death  losses,  and  not  that  any  particular  loss  should  be 
entitled  to  payment  from  the  money  which  arose  from  any  par- 
ticular assessment,  no  death  claim  is  entitled  to  a  preference  or  lien 
upon  funds  in  the  hands  of  the  receiver  of  the  society  hy  reason  of 
any  particular  assessment,  even  though  the  notice  for  which  the 
assessment  was  made  contained  information  of  the  death  of  the 
claimant's  member. 

The  People  vs.  Grand  Lodge,  Empire  Order  of  Mutual  Aid,  Oct.,  1898, 
156  N.  Y.  533,  affirming  88  Hun.  621. 

Suit  for  Accounting  by  Member  Will  Not  Lie. 

A  member  or  certificate  holder  of  an  insurance  corporation  has 


732  FRATERNAL    SOCIETY    LAW 

not  as  such  the  legal  capacity  under  the  laws  of  the  State  of  New 
York  to  bring  action  for  an  accounting  and  for  an  interference  with 
the  prosecution  of  the  business  of  the  corporation,  and  the  action 
must  be  brought,  if  at  all.  by  the  Attorney  General. 

Swan  vs.  Mutual  Reserve  Fund  Life  Assn.,  Jan.,  1898,  155  N.  Y.  9, 
affirming   20   App.   Div.   255. 

Laws  of  Other  States  Presumed  to  be  Same  as  Those  of  New  York. 

Where  in  action  upon  a  contract  of  life  insurance  made  by  a  cor- 
poration of  another  State,  the  contract  is  to  be  construed  under  the 
laws  of  that  State,  it  may  properly  be  assumed  that  those  laws  were 
or  are  the  same  as  our  own,  in  the  absence  of  evidence  tending  to 
show  a  difference. 

Stewart  vs.  Union  Mutual  Life  Ins.  Co.,  March,  1898,  155  N.  Y.  257, 
reversing  76  Hun.  267. 


THE    STATE    OF    NORTH    CAROLINA  733 


THE 

STATE   OF   NORTH    CAROIJNA. 


CHAPTER  34. 

(The  Section  numbers  employed  correspond  to  those  in  "The  Re- 
visal  of  1905  of  North  Carolina"  and  of  amendments  thereto." 

What  Laws  Applicable  to. 

Section  4794.  Nothing  in  the  general  insurance  laws,  except 
such  laws  as  apply  to  fraternal  orders,  shall  be  construed  to  extend 
to  benevolent  associations,  incorporated  under  the  laws  of  this  State 
that  only  levy  an  assessment  on  the  members  to  create  a  fund  to 
pay  the  family  of  a  deceased  member  and  make  no  profit  therefrom, 
and  do  not  solicit  business  through  agents. 

1899,  c.  54,  s.  87 ;  1901,  c.  706,  s.  2. 

Fraternal  Orders  Defined. 

Section  4795.  Every  incorporated  association,  order  or  society 
doing  business  in  this  State  on  the  lodge  system,  with  ritualistic  form- 
of  work  and  representative  form  of  government,  for  the  purpose 
of  making  provision  for  tlie  payment  of  benefits  in  case  of  death, 
sickness,  temporary  or  permanent  physical  disability,  either  as  the 
result  of  disease,  accident  or  old  age,  formed  and  organized  for 
the  sole  benefit  of  its  members  and  their  beneficiaries,  and  not 
for  profit,  is  hereby  declared  to  be  a  "fraternal  beneficiary  order, 
society  or  association ;"  "Provided,  that  societies  and  orders  which 
do  not  make   insurance   contracts  or  collect  dues  or  assessments 


734  FRATERNAL    SOCIETY    LAW 

therefor,  but  simply  p;iy  Ijiirial  or  other  benefits  out  of  the  treasury 
of  their  orders,  and  use  their  funds  for  the  purpose  of  building 
homes  or  asylums  for  the  purpose  of  earing  for  and  educating 
orphan  children  and  aged  and  infirm  people  in  this  State,  shall 
not  be  considered  as  'fraternal  orders'  under  this  act;"  and  such 
order,  society  or  association  paying  death  benefits  may  also  create, 
maintain,  appty  or  disburse  among  its  membership  a  reserve  or 
emergency  fund  as  may  lie  provided  in  its  constitution  or  by-laws; 
but  no  profit  or  gain  shall  be  added  to  the  payments  made  by  a 
member.  Any  incorporated  order,  association  or  society  not  doing 
business  on  the  lodge  system,  with  ritualistic  form  of  work,  which 
is  so  conducted  as  to  make  it  a  fraternal  beneficiary  order,  society 
or  association  within  the  true  meaning  of  this  chapter,  and  shall 
show  such  facts  to  the  satisfaction  of  the  commissioner,  shall  be 
permitted  to  do  business  in  this  State  upon  compliance  with  the 
laws  applicable  to  "fraternal  orders." 

1899,  c.  54,  s.  88;  1901,  c.  706,  s.  3.  and  amended  Mch.  11,  1907. 

Funds  Must  be  Derived  From  Assessments  and  Dues. 

Section  4796.  The  fund  from  which  the  payment  of  benefits, 
as  provided  for  in  the  next  preceding  section  shall  be  made  and 
the  fund  from  which  the  expenses  of  such  association,  order  or 
society  shall  be  defrayed  shall  be  derived  from  assessments  or  dues 
collected  from  its  members.  Such  societies  or  associations  shall  be 
governed  by  the  laws  of  the  State  governing  fraternal  orders,  and 
shall  be  exempt  from  the  provisions  of  all  general  insurance  laws  of 
this  State,  and  no  law  hereafter  passed  shall  apply  to  such  societies 
unless  fraternal  orders  be  designated  therein. 

1899,  e.  54,  s.  89 ;  1901.  c.  706,  s.  2. 

Supreme  Governing  Body  May  Meet  Out  of  the  State;  Principal 
Business  Office  Must  be  Here. 

Section  4797.  Any  such  society  incorporated  and  organized  under 
the  laws  of  this  State  may  pi-ovide  for  the  meeting  of  its  supreme 
legislative  or  governing  body  in  any  other  State,  province  or  terri- 
torv  wherein  such   societv  shall  have  subordinate  lodges,  and  all 


THE    STATE    OF    ^'ORTIl    CAROLINA  735 

business  that  has  been  lierctofore  or  may  hereafter  be  transacted 
at  such  nuM'tiiigs  shall  be  as  valid  in  all  respects  as  if  such  meetings 
were  held  within  this  State ;  but  the  principal  business  office  of 
such  society  shall  always  be  kept  within  this  State  and  never  re- 
moved therefrom. 
1899,  c.  54,  s.  91. 

Conditions  Precedent  to  Doing  Business  Here. 

Section  4798.  Any  such  fraternal  beneficiary  order,  society  or 
association  as  is  detioed  by  this  chapter  chartered  and  organized 
in  this  State,  or  orgnnized  and  doing  business  under  the  laws  of 
another  State,  district,  province  or  territory,  upon  satisfying  the 
insurance  commissioner  that  its  business  is  jjroper  and  legitimate 
and  so  conducted,  may  be  admitted  to  transact  business  in  this 
State  upon  the  same  conditions  as  are  prescribed  by  this  chapter 
for  admitting  and  authorizing  foreign  insurance  companies  to  do 
business  in  this  State,  except  that  such  fraternal  orders  shall  not  be 
required  to  have  the  capital  required  of  such  insurance  companies. 

1899,  c.  54,  s.  92 ;  1901,  c.  706,  s.  2 ;  1903,  c.  438,  s.  9. 

The  next  four  Sections  (4790  to  4793  inc.)  are  here  incorporated 
because  of  the  possibility  of  their  application  to  Fraternal  Societies, 
though  it  has  been  generally  supposed  that  they  do  not  apply. 

Copies  of  Charter  and  By-laws  Must  be  Filed. 

Section  4790.  Every  corporation,  company,  society,  organization 
or  association  of  this  or  any  other  State  or  country,  transacting 
business  under  this  department  upon  the  co-operative  or  assessment 
plan,  shall  file  with  the  insurance  commissioner,  before  commencing 
or  continuing  to  do  business  in  this  State,  a  copy  of  its  charter 
or  articles  of  association,  as  well  as  the  by-laws,  rules  or  regulations 
referred  to  in  its  policies  or  certificates  and  made  a  part  of  such 
contract.  No  by-laws  or  regulations,  unless  so  filed  with  the  in- 
surance commissioner,  shall  operate  to  avoid  or  affect  any  policy 
or  certificate  issued  by  such  company  or  association. 

1899,  c.  54,  s.  86. 


736  FRATERNAL    SOCIETY    LAW 

All  Contracts  Must  be  in  Accord  With  Charter  and  By-laws. 

Section  4791.  Every  policy  or  certificate  or  renewal  receipt  issued 
to  a  resident  of  this  .State  by  any  corporation,  association  or  order 
transacting  therein  the  business  of  insurance  upon  the  assessment 
plan,  shall  be  in  accord  with  the  provisions  of  the  charter  and  by- 
laws of  such  corporation,  association  or  order,  as  filed  with  the  in- 
surance commissioner.  And  it  shall  be  unlawful  for  any  such  do- 
mestic or  foreign  insurance  company  or  fraternal  order  to  transact 
or  ofl'er  to  transact  any  business  not  authorized  by  the  provisions 
of  its  charter  and  the  terms  of  its  by-laws,  or,  through  an  agent 
or  otherwise,  to  ofi'er  or  issue  any  policy,  renewal,  certificate  or 
other  contract  whose  terms  are  not  in  clear  accord  with  the  powers, 
terms  and  stipulations  of  its  charter  and  by-laws. 

1899,  c.  54,  s.  84;  1903,  c.  438,  s.  9. 

Advance  Assessments — When  Required. 

Section  4792.  Every  domestic  insurance  company,  association  or 
order,  doing  business  on  the  assessment  plan  shall  collect  and  keep 
at  all  times  in  its  treasury  one  regular  loss  assessment,  sufficient 
to  pay  one  regular  average  loss. 

1899  c.  54,  s.  84;  1903,  c.  438,  s.  9. 

Revocation  of  Licenses. 

Section  4793.  If  any  such  corporation  or  association  or  order 
shall  at  any  time  fail  or  refuse  to  comply  with  the  provisions  of 
the  two  next  preceding  sections,  or  section  four  thousand  seven 
hundred  and  thirteen,  the  insurance  commissioner  shall  forthwith 
suspend  or  revoke  all  authority  to  siich  corporation,  association  or 
order,  and  of  all  its  agents  or  officers  to  do  business  in  this  State, 
and  shall  publish  such  revocation  in  some  newspaper  published  in 
this  State. 

1899,  c.  54,  s.  85. 

An  Act  Regulating  Insurance  Companies  and  prohibiting  the  diver- 
sion of  funds  for  political  purposes. 

The  General  Assemblv  of  North  Carolina  do  enact: 


THE    STATE    UE    NORTH    CAKOLINA  737 

Section  1.  That  no  iusurauce  company  or  association,  including 
fraternal  beneficiary  associations,  doing  business  in  this  State,  shall, 
directly  or  indirectly,  pay  or  use,  or  offer,  consent  or  agree  to  pay 
or  use  any  money  or  property  for  or  in  aid  of  any  political  party, 
committee  or  organization,  or  for  or  in  aid  of  any  corporation, 
joint-stock  or  other  association  organized  or  maintained  for  political 
purposes,  or  for  or  in  aid  of  any  candidate  for  political  ofSce, 
or  for  nomination  for  such  office,  or  for  any  political  purpose  what- 
soever, or  for  the  reimbursement  or  indemnification  of  any  person 
for  money  or  property  so  used.  Any  officer,  director,  stockholder, 
attorney  or  agent  of  any  corporation  or  association  which  violates 
any  of  the  provisions  of  this  act,  who  participates  in,  aids,  abets 
or  advises,  or  consents  to  any  such  violation,  and  any  person  who 
solicits  or  knowingly  receives  any  money  or  property  in  violation 
of  this  act,  shall  be  guilty  of  a  misdemeanor,  and  be  punished  by 
imprisonment  for  not  more  than  one  j^ear  and  a  fine  of  not  more  than 
one  thousand  dollars;  and  any  officer  aiding  or  abetting  in  any 
contribiTtion  made  in  violation  of  this  act  shall  be  liable  to  the  com- 
pany or  association  for  the  amount  so  contributed.  And  the  Insur- 
ance Commissioner  may  revoke  the  license  of  any  company  violating 
this  act.  No  person  shall  be  excused  from  attending  and  testifying, 
or  producing  any  books,  papers  or  other  documents  before  any 
court  or  magistrate,  upon  any  investigation,  proceeding  or  trial 
for  a  violation  of  any  of  the  provisions  of  this  act,  upon  the  ground 
or  for  the  reason  that  the  testimony  or  evidence,  documentary  or 
otherwise,  required  of  him  may  tend  to  incriminate  or  degrade  him ; 
but  no  person  shall  be  prosecuted  or  subjected  to  any  penalty  or  for- 
feiture for  or  on  account  of  any  transaction,  matter  or  thing  concern- 
ing which  he  may  so  testify  or  produce  evidence,  documentary  or 
otherwise,  and  no  testimony  so  given  or  produced  shall  be  used 
against  him  upon  any  criminal  investigation  or  proceedin?. 

Section  2.  Any  person  violating  the  provisions  of  this  act  shall 
be  guilty  of  a  misdemeanor,  and  upon  conviction  shall  be  fined  not 
more  than  one  hundred  dollars  or  imprisoned  not  more  than  thirty 
days,  or  both,  at  the  discretion  of  the  Court. 

Section  3.     That  this  act  shall  be  in  force  from  and  after  its 
ratification. 
47 


738  FRATERNAL    SOCIETY    LAW 

In  the  General  Assembly  read  three  times,  and  ratified  this  the 
5th  day  of  February,  A.  D.  1907. 

The  following  provisions  are  also  deemed  proper  to  be  incorpo- 
rated here  : 

State  Law  Governs  Insurance  Contracts — When. 

Section  4806.  All  contracts  of  insurance  on  property,  lives  or 
interests  in  this  State  shall  be  deemed  to  be  made  therein;  and 
all  contracts  of  insurance,  the  application  for  which  is  taken  within 
this  State,  shall  be  deemed  to  have  been  made  within  this  State 
and  shall  be  subject  to  the  laws  thereof. 

1899,  c.  54,  s.  2 ;  1901,  c.  705,  s.  1. 

Statements  and  Descriptions  in  Application. 

Section  4808.  AU  statements  or  descriptions  in  any  application 
for  a  policy  of  insurance,  or  in  the  policy  itself,  shall  be  deemed 
and  held  representations  and  not  warranties;  nor  shall  any  repre- 
sentation, unless  material  or  fraudulent,  prevent  a  recovery  on  the 
policy. 

1901,  c.  705,  s.  2. 

Stipulations  as  to  Jurisdiction  and  Limitation  of  Actions. 

Section  4809.  No  company  or  order,  domestic  or  foreign,  au- 
thorized to  do  business  in  this  State,  under  this  chapter,  shall  make 
any  condition  or  stipulation  in  its  insurance  contracts  concerning 
the  court  or  jurisdiction  wherein  any  suit  or  action  thereon  may 
be  brought,  nor  shall  it  limit  tlie  time  within  which  such  suit 
or  action  may  be  commenced  to  less  than  one  year  after  the  cause 
of  action  accrues  or  to  less  than  six  months  from  any  time  at  which 
a  plaintiff  shall  take  a  nonsuit  to  an  action  begun  within  the  legal 
time.  All  conditions  and  stipulations  forbidden  by  this  section  shall 
be  void. 

1899,  c.  54,  .ss.  23,  106;  1901,  c.  391,  s.  8. 

Mortuary  Tables  Evidence. 

Section  1626.     Whenever  it  shall  be  neeessarv  to  establish  tlie 


THE    STATE    OF    NORTH    CAROLINA 


739 


expectancy  of  continued  life  of  any  person  from  any  period  of 
such  person's  life,  whether  lie  he  living-  ;it  the  time  or  not,  the 
t;ible  here  to  appended  slnill  hi;  received  in  all  courts  and  by  all 
persons  having  power  to  determine  litigation  as  evidence,  with 
other  evidence  as  to  the  health,  constitution  and  habits  of  such 
l)erson,  of  such  expectancy  represented  by  the  figures  in  the  columns 
headed  by  the  words  "completed  age"  and  "expectation"  respec- 
tively : 


Completed  Age. 

10  

11  

12  

l:i  

U  

15  

16  

17  

18  

19  

20  

21  

22 

23  ........ 

24  

25  

26  

27  

28  

29  

:]0  

31  

32  

33  

34  

35  

36  

37  

38  

39  

40  

41  

42  

43  

44  


Expect; 


ition. 

43.7 
48.3 
47.4 
46.« 
4r).2 
45.5 
44.9 
44.2 
43.5 
42.9 
42.2 
41.5 
40.9 
40.2 
39.5 
38.8 
38.1 
37.4 
36.7 
36.0 
35.3 
34.6 
33.!) 
33.2 
32.5 
31. S 
31.1 
30.4 
29.6 
28.9 
28.2 
27.5 
26.7 
26.0 
25.3 


Completed  A;i 

45    

46    

47    

48    

49    

50    

51    

52    

53    

54    

55    

56    

57    

58    

59    

60    

61    

62    

63    

64    

65    

66    

67    

68    

69    

70    

71    

72    

73  

74    

75    

76  

77    

78    

79    


Expectation. 

24.5 

23.8 

23.1 

22.4 

21.6 

20.9 

20.2 

19.5 

18.8 

18.1 

17.4 

16.7 

16.1 

15.4 

14.7 

14.1 

13.5 

12.9 

12.3 

11.7 

11.1 

10.5 

10.0 

9.5 

9.0 

8.5 

8.0 

....  7.6 

....  7.1 

....  6.7 

....  6.3 

....  5.9 

....  5.5 

....  5.1 

....  4.8 


740 


FRATERNAL    SOCIETY    LAW 


Completed  Age.  Expectation. 

80  4.4 

81  4.1 

82  3.7 

83  3.4 

84  3.1 

85  2.8 

86  2.5 

87  2.2 

Code,  s.  1352;  1883,  e.  225. 


Completed  Age.  Expectation. 

88  l.>) 

89  1.7 

90  1.4 

91  1.2 

92  1.0 

93  8 

94  6 

95  5 


Present  Worth  of  Annuities. 


Section  1627.  Whenever  it  shall  be  necessary  to  establish  the 
present  worth  or  cash  value  of  an  annuity  to  a  person,  payable 
annually  during  life,  such  present  worth  or  cash  value  may  be 
ascertained  by  the  use  of  the  following  table  in  connection  with 
the  mortuary  tables  established  by  law,  the  first  column  represent- 
ing the  number  of  years  the  annuity  is  to  run  and  the  second  column 
representing  the  present  cash  value  of  an  annuit.v  of  one  dollar  for 
such  number  of  years,  respectively : 


No.  of  years  Cash  value  of 

annuity  is  the  annuity 

to  run.  of  $1. 

1    $0,943 

2    1.833 

3    2.673 

4    3.465 

5    4.212 

6 4.917 

7    5.5S2 

8    6.209 

9    6.801 

10    7.360 

11    7.886 

12    8.383 

13    8.852 

14    9.295 

15    9.712 

16    10.106 

17    10.477 

18    10.827 

19    11.158 

20    11.469 

21    11.761 


No.  of  years                                 Cash  value  of 

annuity  is  the  annuity 

to  run.  ofjl. 

22  12.042 

23  12.304 

24  12.550 

25  12.783 

26  $13,003 

27  13.211 

28  13.406 

29  ..; 13.591 

30  13.765 

31  13.929 

32  14.081 

33  14.230 

34  14.368 

35  14.498 

36  14.621 

37  14.737 

38  14.846 

39  14.949 

40  15.046 

41  15.135 

42  15.219 


THE    STATE    OF    l^OHTH    CAROLINA 


741 


No.  of  years 

Cash  value  of 

No.  of  years 

Cash  value  of 

animiiy  is 

the  annuity 

annuity  Is 

•he  annuity 

to  run. 

of$l. 

to  run. 

of  *l. 

43 15.299 

44  15.374 

45  15.445 

46  15.514 


47  15.579 

48  15.041 

49  15.699 

50  15.754 


The  present  cash  value  of  the  annuity  for  a  fraction  of  a  year 
may  be  ascertained  as  follows :  J\Iultiply  the  difference  between  the 
cash  value  of  the  annuities  for  the  preceding  and  succeeding  full 
years  by  the  fraction  of  the  year  in  decimals  and  add  the  sum  to 
the  present  cash  value  for  the  preceding  full  year.  When  a  person 
is  entitled  to  the  use  of  a  sum  of  money  for  life,  or  for  a  given 
time,  the  interest  thereon  for  one  year  may  be  considered  as  an 
annuity  and  the  present  cash  value  be  ascertained  as  herein  pro- 
vided. 

1905,  c.  347. 

Agents,  Etc.,  Making  False  Statements. 

Section  3487.  If  any  solicitor,  agent,  examining  physician  or 
other  jierson  shall  knowingly  or  wilfully  make  any  false  or  fradu- 
lent  statement  or  representation  in  or  with  reference  to  any  pi;b- 
lication  for  insurance,  or  shall  make  a,ny  such  statement  for  the 
purpose  of  obtaining  fee,  commission,  money  or  benefit  in  any 
e(ir])oration  transacting  business  in  this  State,  he  shall  be  guilty  of 
a  misdemeanor,  and  upon  conviction  shall  be  punished  by  a  fine 
of  not  less  than  one  hundred  dollars  nor  more  than  five  hundred 
dollars,  or  imprisonment  in  the  county  jail  for  not  less  than  thirty 
days  nor  more  than  one  year,  or  both,  at  the  discretion  of  the 
eonrt ;  and  if  any  person  shall  wilfully  make  a  false  statement  of 
any  material  fact  or  thing  in  a  sworn  statement  as  to  the  death 
or  disabilit.v  of  a  policy  or  certificate  holder  in  any  such  corpo- 
ration for  the  purpose  of  procuring  payment  of  a  benefit  named 
in  the  certificate  of  such  holder,  he  shall  be  guilty  of  perjury. 

1899,  c.  54,  s.  60. 


Company  Making  False  Statement. 
Section  3493.     If  any  insurance  company  in  its  annual  or  other 


742  FRATERNAL    SOCIETY    LAW 

statemeut  required  b\'  law  shall  wilfully  misstate  the  facts,  the 
insurance  company  and  the  person  making  oath  to  or  subscribing 
the  same  shall  severally  be  punished  by  a  fine  of  not  less  than  five 
hundred  nor  more  than  one  thousand  dollars.  Any  person  making 
oath  to  such  false  statement  shall  be  guilty  of  the  crime  of  perjury. 
(1899,  c.  5-1,  s.  97.) 

Failure  to  Exhibit  Books  on  Demand. 

Section  'di'J-i.  If  any  person  having  in  his  possession  or  control 
any  books,  accounts  or  pax)ers  of  any  person  licensed  under  the  in- 
surance law  shall,  on  demand,  refuse  to  exhibit  the  same  to  the  in- 
surance commissioner,  or  shall  knowingly  or  wilfully  make  any 
false  statement  in  regard  to  the  same,  such  person  shall  be  deemed 
guilty  of  a  misdemeanor,  and,  upon  conviction  thereof  shall  be  fined 
or  imprisoned,  or  both,  at  the  discretion  of  the  court.  (1899,  c.  54, 
s.  76.) 

Medical  Examination,  When  Required. 

Section  4779.  No  life  insurance  company  organized  under  the 
laws  of  or  doing  business  in  this  State  shall  enter  into  any  contract 
of  insurance  upon  lives  within  this  State  without  having  previously 
made  or  caused  to  be  made  a  prescribed  medical  examination  of  the 
insured  by  a  registered  medical  practitioner.  This  section  shall 
not  apply  to  the  issuing  of  policies,  or  other  contracts  of  insurance, 
for  less  than  one  hundred  dollars. 

Husband  May  Insure  His  Life  for  Benefit  of  Wife  and  Children. 

Section  4771.  The  husband  may  insure  his  own  life  for  the  sole 
use  and  benefit  of  his  wife  and  children,  and  in  case  of  the  death 
of  the  husband,  the  amount  thus  insured  shall  be  paid  over  to  the 
wife  and  children,  or  to  the  guardian,  if  under  age.  for  her,  or  their 
own  use,  free  from  all  the  claims  of  the  repi-esentatives  of  her  hus- 
band, or  any  of  his  ci-editors.     (Const.,  Art  X,  s.  7.) 


THE    STATE    OF    NORTH    CAROLINA  743 

Beneficiary  Takes  Precedence  of  Creditors,  Etc.,  of  Insured — May 
Sue  in  His  Own  Name — If  a  Married  Woman,  Holds  to  Her  Sepa- 
rate Use  and  That  of  Her  Children. 

Section  4772.  When  a  policy  of  insurance  is  effected  by  any 
person  on  his  own  life,  or  on  another  life  in  favor  of  some  person 
other  than  himself  having  an  insurable  interest  therein,  the  lawful 
beneficiary  thereof,  other  than  himself  or  his  legal  representatives, 
shall  be  entitled  to  its  proceeds  against  the  creditors  and  repre- 
sentatives of  the  person  effecting  the  same.  The  person  to  whom 
a  policy  of  life  insurance  is  made  payable  may  maintain  an  action 
thereon  in  his  own  name.  Every  policy  of  life  insurance  made 
payable  to  or  for  the  benefit  of  a  married  woman,  or  after  its  issue 
assigned,  transferred,  or  in  an.y  way  made  payable  to  a  married 
woman,  or  to  any  person  in  trust  for  her  or  for  her  benefit,  whether 
procured  by  herself,  her  husband  or  by  any  other  person,  and 
whether  the  assignment  or  transfer  is  made  by  her  husband  or  by 
any  other  person,  shall  inure  to  her  separate  use  and  benefit  and  to 
that  of  her  children,  if  she  should  die  in  his  lifetime.  (Const.,  Art. 
X,  s.  7;  1899,  c.  54,  s.  59.) 

Life  Insurance  Company  Defined — Requisites  to  Contracts. 

Section  4773.  All  corporations,  associations,  partnerships  or  in- 
dividuals doing  business  in  this  State,  under  any  chai'ter,  compact, 
agreement  or  statute  of  this  or  any  other  State,  involving  the  pay- 
ment of  money  or  other  thing  of  value  to  families  or  representatives 
of  policy  and  certificate  holders  or  members,  conditioned  upon  the 
continuance  or  cessation  of  human  life,  or  involving  an  insurance, 
guaranty,  contract  or  pledge  for  the  payment  of  endowments  or  an- 
nuities, or  who  shall  employ  agents  to  solicit  bx^siuess,  shall  be 
deemed  to  be  life  insurance  companies,  shall  in  all  resp  ects  be  sub- 
ject to  the  laws  herein  made  and  provided  for  the  government  of 
life  insurance  companies,  and  shall  not  make  any  such  insur- 
ance, guaranty,  contract  or  pledge  in  this  State  with  any  citizen 
or  resident  thei-eof,  which  does  not  distinctly  state  the  amount  of 
benefits  payable,  the  manner  of  payment  and  the  consideration  there- 
for. 


744  FRATERNAL    SOCIETY    LAW 

Foreign  Assessment  Companies  or  Orders. 

Section  4713.  Each  foreign  insurance  company,  association,  or 
order,  doing  business  in  this  State  on  the  assessment  plan,  shall 
keep  at  all  times  deposited  in  its  head  office  in  this  State,  or  in  some 
responsible  banking  or  trust  company,  one  regular  assessment  suf- 
ficient to  pay  the  average  loss  or  losses  occurring  among  its  members 
in  this  State  during  the  time  allowed  by  it  for  the  collection  of 
assessments  and  payment  of  losses.  It  shall  notify  the  insurance 
commissioner  of  such  place  of  dej^osit  and  furnish  him  at  all  times 
such  information  as  he  m&y  require  in  regard  thereto. 

May  Require  Books,  Papers,  Etc.,  to  be  Exhibited. 

Section  4697.  It  shall  be  the  duty  of  any  person  having  in  his 
possession  or  control  any  books,  accounts  or  papers  of  any  company, 
order  or  person  licensed  under  this  chapter,  to  exhibit  the  same 
to  the  insurance  commissioner  on  demand.    (1899,  c.  54,  s.  76.) 

Annual  Statements,  Under  Oath,  to  be  Filed  With  the  Commissioner 
— Blanks  to  be  Furnished. 

Section  4698.  Every  insurance  company,  association  or  order — 
domestic,  thi-ough  its  officers,  and  foreign,  through  its  general  agent 
— shall  file  in  the  office  of -the  insurance  commissioner,  on  or  before 
the  first  day  of  March  in  each  year,  in  such  form  and  in  such  detail 
as  the  insurance  commissioner  shall  prescribe,  a  statement  showing 
the  business  standing  and  financial  condition  of  such  company, 
association  or  order  on  the  preceding  thirty-first  day  of  December, 
signed  and  sworn  to  by  the  chief  managing  agent  or  officer  thereof, 
before  the  insurance  commissioner  or  some  officer  authorized  by  law 
to  administer  oaths.  The  insurance  commissioner  shall  in  December 
of  each  year,  furnish  to  each  of  the  insurance  companies  authorized 
to  do  business  in  the  State  two  or  more  blanks  adapted  for  their 
annual  statements. 

Duties  of  Commissioner. 

Section  4689.     The  insurance  commissioner  shall  see  that  all  laws 


THE    HTATE    OF   NORTH    CAROLINA  745 

relating  to  the  companies,  associations  and  orders  under  the  insur- 
ance department  are  faithfully  executed.  ITe  shall  furnish  to  each 
of  the  companies  incorporated  by  this  State  and  to  the  attorneys 
or  general  agents  of  companies  and  associations  incorporated  by 
other  States  and  foreign  governments,  doing  business  in  this  State, 
printed  forms  for  all  statements  required  by  law.  He  shall,  on  or 
before  the  tenth  day  of  each  month,  and  oftener  should  the  sum 
to  the  credit  of  the  State  exceed  twenty  thousand  dollars,  pay  over 
all  taxes,  licenses  and  fees  which  he  may  have  received  during  the 
previous  month  to  the  state  treasurer.  He  shall  perform  all  duties 
now  imposed  upon  him  by  law  in  regard  to  the  examination,  super- 
vision and  conduct  of  companies  and  associations  and  orders.  He 
may  administer  the  oaths  in  the  discharge  of  his  official  duty.  Upon 
a  proper  api)lieation  by  any  citizen  of  this  State  he  shall  'give  a 
statement  or  synopsis  of  the  provisions  of  any  insurance  contract 
offered  or  issued  to  such  citizen.     (1899.  c.  54,  s.  8 ;  1905,  c.  430.  s.  3.) 

Authority  Extends  to  all  Insurance  Companies. 

Section  4691.  Every  insurance  company,  association  or  order,  as 
well  as  every  bond,  investment,  divident,  guarantee,  registry,  title 
guarantee,  debenture,  or  such  other  like  company  (not  strictly  an 
insurance  company,  as  defined  in  the  general  insurance  laws),  shall 
be  licensed  and  supervised  by  the  insurance  commissioner,  and  shall 
pay  all  licenses,  taxes  and  fees  as  prescribed  in  the  insurance  laws 
of  the  State  for  the  class  of  company,  association  or  orders  to  which 
it  may  belong.  No  provision  in  any  statute,  public  or  pi'ivate,  shall 
have  the  effect  of  relieving  any  company,  association  or  order  from 
any  such  supervision  as  is  prescribed  for  the  class  of  companies, 
associations  or  orders  of  like  character,  or  of  releasing  it  from  the 
payment  of  such  licenses,  taxes  and  fees  as  are  prescribed  for  com- 
panies, associations  and  orders  of  the  same  class;  and  all  such 
special  provisions  or  exemptions  are  hereb.v  repealed.  It  shall  be 
unlawful  for  the  insurance  commissioner  to  grant  or  issue  a  license 
to  any  company,  association  or  order,  or  agent  for  them,  claiming 
such  exemption  from  supervision  by  his  department  and  release 
for  the  payment  of  license,  fees  and  taxes.     (1903.  c.  594,  ss.  1,  2,  3.) 


746  FRATERNAL    SOCIETY    LAW 

Conditions  Precedent  to  Liability. 

The  following  condition  contained  in  the  policy,  that  "no  insur- 
ance shall  be  in  force  until  the  delivery  of  the  policy  to  and  the 
pa.yment  of  the  first  premium  by  the  party  whose  life  is  insured, 
while  in  good  health,"  is  valid  and  does  not  contravene  public  policy, 
and  is  important  to  both  parties  as  fixing  a  day  certain  when  the 
agreement  becomes  absolute. 

Ray  vs.  Security  Trust  and  Life  Ins.  Co.,  March,  1900,  126  N.  C.  160, 

Payment  of  Premiums  by  Checks  Through  Mails. 

The  regularity  of  the  United  States  mail  as  a  public  agency  is  such 
that  it  is  not  negligence  to  rely  upon  it  as  a  method  of  transmission 
of  premiums,  especially  as  it  had  been  used  in  the  course  of  dealings 
between  the  parties  previously,  and  there  was  no  express  revocation 
of  the  method  in  vogue  of  the  member  sending  and  the  society  re- 
ceiving checks  in  payment  of  premiums  through  the  mail. 

Hollowell  vs.  Life  Ins.   Co.  of  Virginia,  April,  1900,  126  N.  C.  398. 

Suit,  When  Plaintiff's  Case  is  Made. 

A  prima  facie  case  is  made  for  the  plaintiff  when  the  certificate  is 
introduced,  the  death  of  the  member  proved,  and  demand  for  pay- 
ment shown. 

Doggett  vs.  United  Order  of  the  Golden  Cross,  May,  1900,  126  N.  0. 
477. 

Proofs  of  Death  Waived  by  Denial  of  Liability. 

The  denial  of  liability  waives  the  necessity  for  making  and  filing 
proofs  of  loss. 

Doggett  vs.  United  Order  of  the  Golden  Cross,  May,  1900,  126  N.  C. 
477. 


THE    STATE    OF    NOh'TH    CAROLINA  747 

After-enacted  Laws  Will  Not  be  Permitted  to  Destroy  Contract. 

A  mutual  life  insurance  comjiany,  by  whatever  name  called,  al'li'f 
entering  into  a  contract  of  insurance  with  one  of  its  members -and 
receiving  large  sums  thereunder  cannot,  without  the  member's  con- 
sent, so  alter  the  contract  as  to  practically  desti"oy  its  value. 

Strauss  vs.  Mutual  Reserve  Fund  .Life  Assn.,  June,  1900,  126  N.  C. 
971. 

Damages,  Measure  of  for  Breach  of  Contract  by  Society. 

Where  the  member  refuses  to  comply  with  the  altered  terms  of 
his  contract,  and  to  pay  the  increased  assessments  imposed  thereby, 
and  the  society  ceased  and  refused  to  longer  recognize  him  as  a 
member  on  account  of  his  said  refusal,  the  society  becomes  liable  to 
him  in  damages  if  its  action  in  raising  the  rates  is  excessive  and 
invalid,  and  the  damages  are  to  be  measured  by  the  amount  of  the 
premiums  and  dues  i)aid  by  the  member  under  the  contract,  with 
interest  thereon  from  the  date  of  each  payment. 

Strauss  vs.  Mutual  Reserve  Fund  Life  Assn.,  .June.  1900,  126  N.  C. 
971. 

Beneficiary,  Person  Not  Named  as  Such  Has  No  Right  to  Certificate. 

A  person  having  a  certificate  in  his  possession  but  not  being  named 
therein  as  beneficiary,  has  no  interest  in  same,  it  not  having  been 
assigned  to  the  person. 

Smith  vs.  Supreme  Council.  Royal   Arranum.  Nov.,  1900,  127  N.   C. 
138. 

Occupation,  Change  of  When. 

Where  a  railroad  tlagmau  represented  in  his  application  liis  occu- 
pation to  be  "freight  flagman,  not  coupling  or  switching,"  and  he 
was  killed  while  placing  a  slack  pin  between  two  cars,  this  single 
act  of  the  member  did  not  vitiate  the  contract  or  change  his  oceu- 


748  FRATERNAL    SOCIETY    LAW 

pation  to  one  more  hazardous,  the  classification  of  the  society  being 
solely  of  occupations  and  not  of  risks  or  hazards. 

Hoffman  vs.  Standard  Life  and  Accident  Co.,  Dec,  1900,  127  N.  C.  337. 

State  Insurance  Commissioner,  Power  of  Attorney  to. 

The  power  of  attorney  in  favor  of  the  State  Insurance  Commis- 
sioner authorizing  service  of  process  upon  him,  is  valid  and  is  irre- 
vocable. 

Biggs  vs.  Mutual  Reserve  ITund  Life  Assn.,  March,  1901,  128  N.  C.  5. 

Agency  of  Local  Official. 

The  financial  secretary  of  a  local  lodge  is  the  agent  of  the  Su- 
preme Lodge,  and  his  failure  to  transmit  money  received  for  assess- 
ments does  not  operate  to  forfeit  the  certificate. 

Bragaw  vs.  Supreme  Lodge.  Knights  and  Ladies  of  Honor.  May.  1900. 
128  N.   C.   354. 

After-enacted  Laws,  When  Valid. 

"A  provision  that  one  should  become  a  member  subject  to  the 
power  of  a  corporation  to  change  its  by-laws,  cannot  be  construed 
into  liberty  to  change  at  its  will  the  contract  of  insurance  it  has 
made  with  each  insured.  The  company  and  the  assured  occupy  two 
entirely  different  relations.  In  one  it  is  a  company  and  the  other 
party  one  of  its  members.  In  that  relation  the  by-laws  or  constitu- 
tion can  be  amended  at  will  of  the  majority,  if  done  in  the  legal 
and  prescribed  mode.  The  other  relation  is  that  of  insurer  and 
insured,  and  this  contract  relation  cannot  bo  altered  save  by  tlir-  con- 
sent of  both  parties." 

Bragaw  vs.  Supreme  Lodge.  Knights  and  Ladies  of  Honor,  May.  1900, 
128  N.   C.   354. 

After-enacted  Laws,  When  Not  Valid. 

A  mere  general  assent  by  a  nicmbci-  of  a  mutual  benefit  society 


THE    STATE    OF   NORTH    CAROLINA  749 

to  the  amendment  of  its  laws  and  constitution  does  not  authorize 
such  a  change  as  will  destroy  his  vested  rights. 

Strauss  vs.  Mutual  Reserve  Fund  Life  Assn.,  June,  1901.  128  N.  C. 

465; 
Simmons  vs.  Mutual  Reserve  Fund  Life  Assn.,  June,  1901,  128  N.  C. 

469. 

Foreign  Society,  How  Domesticated. 

A  fraternal  society  incorporated  under  an  act  of  congress  as  a 
District  of  Columbia  corporation  becomes  a  domestic  corporation  by 
complying  with  the  acts  of  1899,  chapter  62,  of  N(u-tli  Carolina. 

Layden  vs.   Endowment  Rank,   Knights  of  Pytliias,  June,   1901,   128 
N.  C.  546. 

Service  of  Process  on  Insurance  Commissioner. 

A  power  of  attorney  in  favor  of  the  State  Insurance  Commissioner 
is  irrevocable  so  long  as  the  company  has  liabilities  in  the  State  re- 
maining luisatisfied,  and  service  of  process  on  the  commissioner  is 
valid  although  the  company  has  not  domesticated  under  the  laws  of 
the  State. 

Moore  vs.  Mutual  Reserve  Fund  Life  Assn.,  Sept.,  1901,  129  N.  C.  31. 

Agency  of  Local  Officials. 

The  officers  of  a  subordinate  lodge  in  the  performance  of  their 
duties  under  the  by-laws  enacted  by  the  Supreme  Lodge  are  to  be 
held  to  be  the  agents  of  the  Supreme  Lodge. 

Cheek  vs.  Supreme  Lodge,  Knights  of  Honor,  Nov.,  1901,  129  N.  C. 
179. 

Physician,  Privileged  Communications  May  be  Made  Competent  by 
Waiver  of  Statute. 

An  applicant  for  membership  in  a  society  may  waive  the  right  on 
behalf  of  his  beneficiaries  to  object  to  the  evidence  of  a  physician 


750  FRATERNAL    SOCIETY    LAW 

acquired  while  attending  him,  and  the  physician  may  be  compelk*<!  to 
testify. 

"At  common  law  there  is  no  privilege  extending  to  the  relation 
between  patient  and  physician ;  while  as  between  attorney  and  client, 
the  attorney  entrusted  with  the  secrets  of  the  cause  by  the  client 
shall  not  be  compelled  to  give  evidence  of  such  conversation  on  mat- 
ters 01  privacy  as  come  to  his  knowledge  by  virtue  of  such  trust  and 
confidence,  but  with  the  client's  consent  it  may  be  waived  and  he 
ma.y  be  compelled  to  testify.  The  privilege  between  patient  and 
physician  created  by  our  statute  is  less  stringent  and  more  lax  than 
that  of  the  common  law  between  attorney  and  client.  As  between 
the  latter,  the  attorney's  mouth  is  sealed  for  all  time  except  by  eon- 
sent,  and  he  cannot  be  compelled  by  court  to  testify,  while  under 
our  statute  it  is  provided  that  the  judge,  in  furtherance  of  the  ad- 
ministration of  justice,  may  compel  the  physician  to  disclose  the 
information  acquired  by  him  from  his  patient." 

Fuller  vs.  Knights  of  Pythias.  Dec,  1901,  129  N.  C.  318. 

Forfeiture,  Self-executing  Provisions. 

The  non-payment  of  dues  or  assessments,  if  it  is  stipulated  in  the 
policy,  will  of  itself  work  a  forfeiture. 

Riddifk   vs.   The   Farmers'   Life  Assn.,  March.  1903,   132   N.   C.  US. 

Cancellation,  Damages  for.  Measure  of. 

Where  an  insurance  contract  is  wrongfully  cancelled,  the  amount 
of  the  recovery  by  the  assured  is  the  premiums  paid  with  interest 
thereon  from  the  dates  of  payments. 

Gwaltney  vs.  Provident  Savings  Life  Assurance  Society,  June,  1903. 
132  N.   C.   925. 

Breach  of  Contract,  Measure  of  Damages  for. 

The  liolilcM'  (if  a  ccrtilifatr  which  has  iiccii  illc^'ally  reduced  by  the 


THE    UTATE    OF    NOKTU    CAICOLINA  751 

society  is  entitled  to  sue  for  the  payments  made  with  interest  thereon 
from  the  dates  when  they  were  paid. 

Makely   vs.  American   Legion  of  Honor,  Nov.,   1903,   133  N.  C.   367. 

After-enacted  Laws,  When  Not  Valid. 

A  mutual  life  insurance  society  cannot  by  changing  its  by-laws 
lessen  the  value  of  the  contract  by  reducing  the  amount  of  in- 
demnity. 

Makely  vs.  American   Legion   of   Honor,  Nov.,   1903,   133   N.   C.   367. 

After-enacted  Laws,  Valid  When. 

A  mutual  society  cannot  change  its  constitution  subsequent  to 
the  contract  with  its  members  and  to  their  detriment  except  by 
mutual  consent. 

Johnson  vs.  Reformers,  May,  1904,  135  N.  C.  385. 

Insurance  Commissioner,  Power  of  Attorney  to. 

The  power  of  attorney  executed  to  the  State  Insurance  Commis- 
sioner appointing  him  attorney  upou  whom  process  can  be  served, 
is  irrevocable  and  remains  in  force  as  long  as  any  liability  against 
the  company  exists  in  the  State. 

Mut.  Reserve  Fund  Life   Assn.  vs.   Scott,  Oct.,  1904,  136  N.  C.   157. 

Contract,  Date  When  Same  Takes  Effect. 

An  insurance  contract  takes  eifect  from  the  date  of  the  certificate, 
unless  it  is  stated  that  it  shall  take  effect  only  upon  certain  con- 
ditions being  met.  If  it  is  delivered  it  takes  effect  as  of  the  day 
of  its  date. 

Rayburn   vs.   Casualty   Co..   May,   1905,   138   N.   C.   379. 

Foreign  Societies  Cannot  Avail  Under  Statute  of  Limitations. 

Under  Section  162  of  the  Code,  the  statute  of  limitations  does  not 


752  FRATERNAL    SOCIETY    LAW 

run   in   favor  of  a   non-resident  whether  it   is  an  individual   or  a 
corporation. 

Green  vs.  Hartford  Life  Ins.  Co.,  Oct.,  1905,  139  N.  C.  309. 

Assessments,  Members  Cannot  Defeat  Same  for  Losses  Occurred  Dur- 
ing Membership. 

Where  the  members  of  a  mutual  insurance  company  have  enjoyed 
the  protection  which  the  membership  affords,  they  cannot,  after  a 
loss  has  been  sustained,  withdraw  and  refuse  to  pay  their  portion 
of  the  loss. 

Perry  vs.  Farmers'  Mut.  Fire  Ass'n,  Oct.,  1905,  139  N.  C.  374. 

Agency  of  Local  Official,  When  Knowledge  Imputed. 

Where  a  local  agent  has  actual  knowledge  of  the  falsity  of  a  state- 
.  ment  made  by  the  applicant  in  his  api^lieation  for  insurance,  and 
forwards  the  application  upon  which  the  certificate  is  issued,  the 
knowledge  of  the  agent  is  held  to  be  the  knowledge  of  the  company, 
and  the  false  statement  Avill  not  void  the  contract  in  the  absence 
of  any  evidence  of  actual  fraud  on  the  part  of  the  applicant  and 
agent. 

Fishblate  vs.  Fidelity  Co.,  March,   1906,  140  N.  C.  589. 

Representations,  Materiality  of. 

Every  fact  untruly  asserted  or  wrongfully  suppressed  must  be 
regarded  as  material  if  the  knowledge  or  ignorance  of  it  would 
naturally  infliience  the  judgment  of  the  society  in  making  the  con- 
tract or  in  estimating  the  degree  and  character  of  the  risk,  or  fixing 
the  rate  of  the  member's  contribution. 

Fishblate.  vs.  Fidelity  Co.,  March,  1906,  140  N.  C.   589. 

Foreign  Society,  Receiver  Will  Not  be  Appointed. 

A  receiver  for  a  foreign  insurarice  company  will  not  be  appointed 


THE  STATE  OF  NOR'J'JI    CAROLINA  753 

where  the  company  has  no  assets  or  property  within  the  State  other 
than  assessments  to  become  due  from  niembi  rs  ol'  ihe  company  liv- 
ing within  the  State. 

Blackwell  vs.  Mut.  Reserve  Fund  Life  Assn.,  April,  1906,  141  N.  C. 
117. 

Foreign  Society  Contracts  Governed  by  Laws  of  This  State. 

A  provision  in  a  contract  of  insurance  that  "this  contract  shall 
be  governed  by,  subject  to,  and  construed  only,  according  to  the 
laws  of  the  State  of  New  York,  the  place  of  this  contract  being  ex- 
pressly agreed  to  be  the  home  office  of  said  association  in  the  city  of 
New  York,"  is  void  so  far  as  the  courts  of  this  State  are  concerned. 

Blackwell  vs.  Mut.  Reserve  Fund  Life  Assn.,  April,  1906,  141  N.  C. 
117. 

Proofs  of  Death,  Denial  of  Contract  Waives  Same. 

The  denial  of  the  existence  of  any  contract  of  insurance,  or  of 
any  liabilitj^,  is  a  waiver  of  proofs  of  loss. 

Lanier  vs.  Ins.  Co.,  Sept.,  1906,  142  N.  C.  14. 

Reinstatement,  Acts  of  Officer  in  Connection  Not  Ministerial. 

A  provision  in  a  contract  reading  that  "delinquent  members  may 
be  reinstated,  if  approved  by  the  Medical  Director  and  President 
by  giving  reasonable  assurances  that  they  are  in  continued  good 
health."  is  valid,  and  the  approval  required  is  not  a  mere  ministerial 
act  but  involves  the  exercise  of  judgment  and  discretion. 

Lane  vs.  Fid.  Mut.  Life  Ins.  Co.,  Sept..  1906,  142  N.  C.  55. 

Assessments,  Mailing  Notices  Valid. 

A  by-law  providing  that  notices  may  be  given  members  of  assess- 

48 


754  FRATERNAL    SOCIETY    LAW 

ments  by  mailing,  properly  addressed,  is  valid  and  binding  upon 
the  members. 

Duffy  vs.   Fid.  Mut.  Life   Ins.  Co.,   Sept.,   1906,  142  N.  C.  103. 

Suicide,  Sane  or  Insane  Provision  Valid. 

A  provision  in  a  contract  that  if  the  insured  within  one  year  from 
the  issue  of  the  contract  shall  die  by  his  own  act  or  hand,  whether 
sane  or  insane,  the  society  shall  not  be  liable  for  any  greater  sum 
than  the  amount  paid  in  assessments,  is  valid  and  refers  to  suicide, 
b\it  does  not  include  killing  by  accident. 

Thaxton   vs.   Ins.  Co.,   Nov.,   1906,   143   N.  C.   33. 

Reinstatement  May  be  Secured  Only  in  Strict  Conformity  to  Laws. 

Where  a  bj'-law  provided  that  "any  member  failing  to  pay  his  as- 
sessment within  thirty  days  after  notice  mailed  to  him,  shall  be 
dropped  from  the  association  and  shall  be  required  to  pay  a  new 
membership  fee  in  order  to  renew  his  insurance,"  and  the  member, 
having  failed  to  pay  an  assessment  of  which  he  had  notice,  was 
dropped,  the  society  had  the  right  to  refuse  to  reinstate  him  after 
the  lapse  of  three  months  after  he  had  forfeited  his  contract,  and 
when  his  health  had  become  hopelessly  impaired. 

Hay  vs.  People's  Mut.  Benev.  Assn,  Dec,  1906,  143  N.  C.  256. 

Assessments,  Prompt  Payment  of  Not  Waived  by  Occasional  Favors. 

The  fact  that  a  society  on  some  occasions  accepts  payments  of 
members'  assessments  after  they  should  have  been  paid,  does  not 
constitute  a  waiver  of  the  terms  of  the  contract  nor  amount  to  an 
agreement  that  assessments  need  not  be  paid  promptly,  especiall.v 
where  there  Avas  unreasonable  delay  and  the  health  of  the  member 
had  become  hopelessly  impaired. 

Hay  vs.  People's  Mut.  Benev.  Assn.,  Dec.  1906.  143  N.  C.  256. 


THIi  UTATB  OF  NORTH  CAROLINA  755 

Agency,  What  Acts  Are  Not  Imputed  to  Society. 

Where  the  ayeiit  had  im  pdwci-  tn  issue  |iolicies  and  was  not  the 
fieneral  agent  of  the  company  liiit  a  soliciting  agent  of  restricted 
powers,  his  mistake  concerning  the  policy  to  be  issued,  which  was 
contrary  to  the  rules  and  regulations  of  the  company,  and  which 
it  did  not  authorize,  cannot  be  imputed  to  the  company. 

Floars  vs.  Aetna  Life  Ins.  Co.,  April,  1907,  144  N.  C.  232. 

Members  Charged  With  Knowledge  of  Contract  Provisions. 

Where  persons  receive  contracts  of  insurance  and  make  payments 
luuler  them,  and  do  not  read  the  contracts  for  some  years,  but  sub- 
sequently read  a  portion  of  the  contracts  and  continue  to  make  pay- 
ments for  several  years  longer,  they  are  not  to  be  heard  to  complain 
of  the  provisions  of  the  contract. 

Cathcart  vs.  Life  Ins.  Co.  of  Virginia.  May,  1907,  144  N.  C.  623. 
See  also 

Slkes  vs.  Life   Ins.  Co.   of  Virginia,  May,   1907,  144   N.  C.   626. 

Contracts,  Forms  of,  Judicial  Notice  Respecting. 

The  Court  will  take  judicial  notice  that  jiolicies  of  insurance  are 
gotten  up  on  printed  forms  designed  to  meet  the  average  and  gen- 
eral demand  in  contracts  of  this  nature,  and  frequently  changes  are 
made  to  meet  special  conditions ;  and  in  the  absence  of  special  cir- 
cumstances tending  to  cast  suspicion  thereon,  entries  by  marginal 
notes  and  pasters  on  the  policy  raise  no  presumption  of  alteration, 
but  the  nature  of  the  enti'y  and  its  placing  are  simply  circumstances 
on  the  general  question  for  the  .jury  as  to  a  completed  contract. 

Waters  vs.  Security  Life  and  Annuity  Co..  May.  1907.  144  N.  C.  663. 

Foreign  Corporations  Have  Rights  Only  by  Grace. 

The  legislature  has  the  power  to  prescribe  the  terms  on  which 


756  FRATERNAL    SOCIETY    LAW 

foreign  corporations  may  enter  the  State  and  may  pass  statutes  for 
the  protection  of  its  own  citizens  doing  business  with  such  corpora- 
tions, as  against  the  objection  that  such  statutes  discriminate  against 
non-residents. 

Williams  vs.  Mut.  Reserve  Fund  Life  Assn.,   Supreme  Court  of  N. 
C,  Oct.,  1907,  58   S.  E.  802. 

Assig-nment,  Form  Not  Essential. 

No  particular  form  of  words  is  essential  to  effect  an  assignment  or 
surrender  of  a  policy  of  insurance. 

Ormond  vs.  Connecticut  Mut.  Life  Ins.  Co.,  Supreme  Court  of  N.  C, 
Oct.  1907,  58  S.  E.  997. 

Jurisdiction,  Service  of  Summons  on  Commissioner. 

In  an  action  against  a  foreign  fraternal  society  doing  business 
within  the  State,  service  of  summons  on  the  insurance  commissioner 
confers  jurisdiction  on  the  society. 

Brenizer  vs.  Supreme  Council,  Royal  Arcanum,  Supreme  Ct.  N.  C, 
May,  1906,  53  S.  E.  835. 

Trust  Funds,  Mortuary  Funds  are. 

The  constitution  of  a  society  provided  that  one  of  its  objects  was 
to  establish  a  widows'  and  orphans'  benefit  fund  from  which  an 
amount  not  to  exceed  $3,000.00  was  to  be  paid  to  the  wife,  etc.,  of 
deceased  members;  that  the  fund  from  which  payments  should  be 
made  was  to  be  derived  from  assessments  collected  from  members, 
and  that  the  expenses  of  the  society  should  be  defrayed  from  per 
capita  tax  dues  and  expense  assessments.  Provision  was  also  made 
for  creating  from  assessments  an  emergency  fund  in  excess  of  cur- 
rent death  losses.  It  was  held  that  assessments  payable  into  the 
benefit  fund  which  -was  in  the  hands  of  the  local  collector,  and  which 
he  was  bound  to  pay  into  the  society,  were  trust  funds  for  the 
beneficiaries  of  deceased  uioiubers  and  were  not  s\ibjoet  to  attach- 
ment by  a  creditor  of  the  society. 


THK  .STATE  OF  NORTH  CAROLINA  757 

Brenizer  vs.  Supreme  Council,  Roya!   Arcanum,  Supreme  Ct.  N.  C., 
May,  190G,  53  S.  E.  835. 

Foreign  Society,  Rights  of. 

The  courts  of  a  State  have  no  power  to  control   the  Supreme 
Council  of  a  foreign  fraternal  societ.y  by  mandamus  or  injunction. 

Brenizer  vs.  Supreme  Council,  Royal  Arcanum,  Supreme  Ct.  N.  C., 
May,  1906,  53  S.  E.  835. 


758  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  NORTH  DAKOTA. 


CHAPTER  35. 

Article  5.  Chapter  17  of  the  Civil  Code  of  North  Dakota  relates 
to  fraternal  societies  and  is  as  follows: 

Fraternal  Beneficiary  Societies. 

Section  4570.  A  fraternal  beneficiary  association  is  hereby  de- 
clared to  be  a  corporation,  society  or  voluntary  association,  formed, 
or  organized  and  carried  on,  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have  a 
lodge  .system,  with  ritualistic  form  of  work  and  representative  form 
of  government,  and  shall  make  provision  for  the  payment  of  benefits 
in  case  of  death,  and  may  make  provision  for  the  payment  of  bene- 
fits in  case  of  sickness,  temporary  or  permanent  physical  disability, 
either  as  the  result  of  disease,  accident  or  old  age,  provided  the 
period  in  life  at  which  payment  of  physical  disability  benefits  on  ac- 
count of  old  age  commences,  shall  not  be  under  seventy  years,  sub- 
ject to  their  compliance  with  its  constitution  and  laws.  The  fund 
from  which  the  payment  of  such  benefits  shall  be  made,  and  the  fund 
from  which  the  expenses  of  such  association  shall  be  defrayed,  shall 
be  derived  from  asses.sments  or  dues  collected  from  its  members. 
Payment  of  death  benefits  shall  be  to  the  families,  heirs,  blood  rela- 
tives, aifianced  husband  or  affianced  wife  of  or  to  persons  dependent 
upon  the  member.  Such  a.ssociation  shall  be  governed  by  this  article 
and  shall  be  exempt  from  the  provisions  of  insurance  laws  of  this 
State,  and  no  law  hereafter  passed  shall  apply  to  them  unless  they 


THE    STATE    OF    NORTH    DAKOTA  76!> 

be  expressly  designated  therein.  Any  such  fraternal  beneficial  asso- 
ciation may  create,  maintain,  disburse  and  apply  a  reserve  or  emer- 
gency fund  in  accordance  with  its  constitution  or  by-laws.  [1901,  ch. 
90,  §  1.] 

How  to  Proceed. 

Section  4571.  All  such  associations  coming  within  the  descrii)tion, 
as  set  forth  in  Section  4570,  organized  under  the  laws  of  this  or  any 
other  State,  province  or  territory,  and  now  doing  business  in  this 
State,  may  continue  such  business;  provided,  that  they  hereafter 
comply  with  the  provisions  of  this  article  regulating  annual  reports 
and  the  designation  of  the  commissioner  of  insurance  as  the  person 
upon  whom  process  may  be  served  as  hereinafter  provided.  [  1901, 
ch.  90,  §  2.] 

How  to  do  Business  in  This  State. 

Section  4572.  Any  such  association  coming  within  the  description, 
as  set  forth  in  Section  4570,  organized  under  the  laws  of  any  other 
State,  province  or  territory,  and  not  now  doing  business  in  this 
State,  shall  be  admitted  to  do  bushiess  within  this  State  when  it 
shall  have  filed  with  the  commissioner  of  insurance,  a  duly  certified 
copy  of  its  charter  and  articles  of  association,  and  a  copy  of  its  con- 
stitution or  laws,  certified  to  by  its  secretary  or  corresponding  officer, 
together  with  the  appointment  of  the  commissioner  of  insurance  of 
this  State  as  a  person  vipon  whdui  process  may  be  served  as  herein- 
after provided;  and,  provided,  that  such  association  shall  be  shown 
to  be  authorized  to  do  business  in  the  State,  province  or  territory 
in  which  it  is  incorporated  or  organized,  in  case  the  laws  of  such 
State,  province  or  territory  shall  provide  for  such  authorization;  and 
in  case  the  laws  of  such  State,  province  or  territory  do  not  provide 
for  any  formal  authorization  to  do  business  on  the  part  of  such  asso- 
ciation, then  such  association  shall  be  shown  to  be  conducting  its 
business  in  accordance  with  the  provisions  of  this  article,  for  which 
purpose  the  commissioner  of  insurance  of  this  State  may  personally, 
or  by  some  person  to  be  designated  by  him,  exnmine  into  the  condi- 
tion, affairs,  character  and  business  methods,  accounts,  books  and  in- 


760  FRATERNAL    SOCIETY    LAW 

vestments  of  such  association  at  its  home  office,  which  examination 
shall  be  at  the  expense  of  such  association,  and  shall  be  made  within 
thirty  days  after  the  demand  thereof,  and  the  expense  of  such  exam- 
ination shall  be  limited  to  one  hundred  dollars.     [1901.  ch.  90,  §  3.] 

Must  File  Certificate  of  Authorization. 

Section  4573.  ^^ly  association  doing  business  under  this  article 
shall  be  permitted  to  do  business  upon  filing  annually  with  the  com- 
missioner of  insurance  of  this  State,  the  certificate  of  authorization 
of  the  insurance  department  of  the  State,  province  or  territory  in 
which  it  is  incorporated  or  organized;  provided,  however,  in  case  of 
failure  to  file  said  certificate  by  any  such  association,  or  in  case  the 
commissioner  of  insurance  shall  deem  it  necessary,  he  shall  have 
power  to  examine,  eitlier  personally  or  by  some  person  designated 
by  him,  into  the  condition,  afi:'airs,  character,  business  methods,  ac- 
counts, books  and  investments  of  such  association,  at  its- home  office, 
which  examination  shall  be  at  the  expense  of  the  association;  the 
amount  thereof  shall  not  exceed  one  hundred  dollars  in  associations 
with  no  reserve  or  emergencj'  fund,  and  two  hundred  dollars  for 
associations  with  a  reserve  or  emergencj^  fund.     [1901.  ch.  90.  §  4.] 

Must  Make  Annual  Report. 

Section  4574.  Everj^  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and  file 
with  the  commissioner  of  insurance  of  this  State,  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  thirty-first  day 
of  December,  immediately  preceding,  which  annual  report  shall  be  in 
lieu  of  all  other  reports  required  by  any  other  law.  Such  reports 
shall  be  uj^on  blank  forms,  to  be  provided  by  the  commissioner  of 
insurance,  or  may  be  printed  in  pamphlet  form,  and  shall  be  verified 
under  oath  by  the  dul.v  autliorized  officers  of  such  association,  and 
shall  contain  answers  to  the  following  questions : 

1.  Number  of  certificates  issued  during  the  year,  or  members  ad- 
mitted. 

2.  Amount  of  indemnity  effected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 


THE    STATE    OF    NORTH    DAKOTA  761 

4.  Numbei-  oi  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representatives 
or  heirs. 

7.  Number  and  l<in(l  nf  chiinis  Uiv  whieh  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and  state- 
ment of  reasons. 

9.  Does  association  charge  annual  or  other  periodical  dues  or  ad- 
mission fees  ? 

10.  How  nuich  on  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be. 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  the  association  guarantee,  in  its  certificate,  fixed  amounts 
to  be  paid,  regardless  of  amount  realized  from  assessments,  dues, 
admission  fees  and  donations? 

14.  If  so,  state  amount  guaranteed,  and  the  security  of  such  guar- 
anty. 

15.  Has  the  association  a  reserve  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested? 

17.  Has  the  association  more  than  one  class? 

18.  If  so,  how  many,  and  the  amount  of  indemnity  in  each? 

19.  Number  of  members  in  each  class. 

20.  If  voluntary,  so  state,  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law, 
and  at  what  time;  giving  chapter  and  year  and  date  of  the  passage 
of  the  act. 

22.  If  organized  under  the  laws  of  any  other  State,  province  or 
territory,  state  such  fact,  and  the  date  of  organization,  giving  chapter 
and  year  and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  beneficiary  membership  lapsed  dur- 
ing the  year. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more  than 
one  class,  number  in  each  class. 


762  FRATERNAL    SOCIETY    LAW 

25.  Names  and  addresses  of  its  president,  secretary  and  treasurer, 
or  corresponding  officers. 

The  commissioner  of  insurance  is  authorized  and  empowered  to 
address  any  additional  inquiries  to  any  such  association,  in  relation 
to  its  doings  or  condition,  or  any  other  matter  connected  with  its 
transaction,  relative  to  the  business  contemplated  by  this  article ;  and 
such  officers  of  such  association,  as  the  commissioner  of  insurance 
maj'  require,  shall  promptly  reply  in  writing,  under  oath,  to  all  such 
inquiries.     [1901,  ch.  90,  §  5.] 

When  Principal  Office  is  Not  in  the  State. 

Section  4575.  Each  such  association  now  doing,  or  hereafter  ad- 
mitted to  do,  business  within  this  State,  and  not  having  its  principal 
office  within  this  State,  and  not  being  organized  under  the  laws  of 
this  State,  shall  appoint,  in  writing,  the  commissioner  of  insurance, 
and  his  successors  in  office,  to  be  its  true  and  lawful  attorney,  upon 
whom  all  lawful  process  in  any  action  or  proceeding  against  it  must 
be  served,  and  in  such  writing  shall  agree  that  any  lawful  process 
against  it,  which  is  served  on  said  attorney,  shall  be  of  the  same  legal 
force  and  validity  as  if  served  upon  the  association,  and  that  the 
authority  shall  continue  in  force  so  long  as  any  liability  remains  out- 
standing in  this  State.  Copies  of  such  certificate,  certified  by  said 
commissioner  of  insurance,  shall  be  deemed  sufficient  evidence  there- 
of, and  shall  be  admitted  in  evidence  with  the  same  force  and  eft'ect 
as  the  original  thereof  might  be  admitted.  Service  upon  such  at- 
torney shall  be  deemed  sufficient  service  upon  such  association. 
"When  legal  process  against  any  such  association  is  served  upon  said 
commissioner  of  insurance,  he  shall  immediately  notify  the  associa- 
tion of  such  service  by  letter,  prepaid  and  directed  to  its  secretary 
or  corresponding  officer,  and  shall  withiu  two  days  after  such  ser- 
vice forward  in  the  same  manner  a  copy  of  the  process  served  on 
him  to  such  officer.  The  plaintiff  in  such  process  so  served  shall  pay 
to  the  commissioner  of  insurance,  at  the  time  of  such  service,  a  fee  of 
three  dollars,  wliicli  shall  he  recovered  by  him  as  a  part  of  the  tax- 
able co.sts,  if  he  prevails  in  the  suit.  The  comniissionor  of  insurance 
shall  keep  a  roenrd  of  all  processes  served  upon  him,  which  record 


THE    STATE    OF    NORTH    DAKOTA  763 

shall  show  tlie  d;iy  and  lionr  when  such  serviei'  was  made.     [1901, 
ch.  90,  §  C] 

Insurance  Commissioner  Issues  Permit. 

Sectiou  4576.  The  commissioner  of  insurance  of  this  State  shall, 
upon  application  of  any  association  having  the  right  to  do  business 
within  this  State,  as  provided  by  this  article,  issue  to  such  associa- 
tion annually  a  permit  in  writing  authorizing  such  association  to  do 
business  within  this  State,  for  which  permit  and  all  proceedings  in 
connection  therewith,  such  association  shall  pay  to  said  commissioner 
the  fee  of  fifteen  dollars.     [1901,  ch.  90,  §  T.] 

File  Articles  of  Incorporation. 

Section  -1.377.  Every  fraternuj  or  l)eii('liei;ti'y  society  or  associa- 
tion which  undertakes  to  furnish  indemnity  to  its  members  or  their 
families,  which  is  not  incorporated  under  the  laws  of  another  State, 
shall  before  doing  business  in  this  State,  incorporate  under  the  pro- 
visions of  article  3  of  this  chapter,  and  in  addition  shall  file  with  the 
coiuniissiouer  of  insurance  a  duly  certified  copy  of  its  articles  of  in- 
corporation, and  a  copy  of  its  constitution  and  laws,  duly  certified 
by  its  secretary  of  corresponding  officer,  and  shall  in  all  respects 
comply  with,  and  be  subject  to,  the  provisions  of  this  article  so  far 
as  tile  saiiii'  are  applicable.  Such  commissioner  of  insurance  shall, 
before  issuing  a  permit  to  such  corporation  to  do  business,  examine 
into  its  character  and  ascertain  that  it  in  all  things  has  complied 
with  the  requirements  of  this  article.     [1901,  ch.  90,  §  8.] 

Paid  Agents,  when  Employed. 

Section  4578.  Such  association  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organization  or  build- 
ing up  of  subordinate  bodies,  or  granting  members  inducements  to 
procure  new  members.     [1901,  ch.  90.  >;  9.] 

Contract  Not  Valid. 

Section   4579.      No   contract   with   anv  such    association   shall   be 


764  FRATERNAL    SOCIETY    LAW 

valid  when  there  is  a  contract,  agreement  or  understanding  between 
the  member  and  the  beneficiary  that  the  beneficiary,  or  any  person 
for  him,  shall  pay  such  memljer's  assessments  or  dues,  or  either  of 
them.     [1891,  ch.  90,  §  10.] 

Benefit  Not  Liable  to  Attachment. 

Section  4580.  The  money  or  other  benefit,  charity,  relief  or  aid 
to  be  paid,  provided  or  rendered  by  any  association  authorized  to 
do  business  under  this  article,  shall  not  be  liable  to  attachment  by 
trustee,  garnishee  or  other  process,  and  shall  not  be  seized,  taken, 
appropriated  or  applied  by  any  legal  or  equitable  process,  or  by 
operation  of  law,  to  pay  any  debt  or  liability  of  a  certificate  holder, 
or  of  any  beneficiary  named  in  a  certificate,  or  any  person  who  may 
have  any  right  thereunder.     [1901,  ch.  90,  §  11.] 

Must  Show  Mortuary  Assessment  Rate. 

Section  4581.  No  association,  not  admitted  to  transact  business 
within  this  State  prior  to  the  taking  effect  of  this  article,  shall  be 
incorporated,  or  given  a  permit,  or  certificate  of  authority  to  transact 
business  within  this  State,  as  provided  for  by  this  article,  unless  it 
shall  first  be  shown  that  the  mortuary  assessment  rates,  provided 
for  in  whatever  plan  or  business  it  has  adopted,  are  not  lower  than  is 
indicated  as  necessary  b.v  the  following  mortality  table : 

FRATERNAL  CONGRESS  MORTALITY  TABLE. 

No.  Dying.     Probabilit.v  of  Dying. 

500  .005000 

501  .005035 

502  .005071 

503  .005107 
505  .005153 
507  .005201 
510  .005259 
513  .005318 
517  .005388 


Lge. 

No.  Living. 

20 

100,000 

21 

99,500 

22 

98.999 

23 

98,497 

24 

97,994 

25 

97,489 

26 

96,982 

27 

96,472 

28 

95.959 

THK    ti'VATE    OF    NORTH    DAKOTA  765 


No.  Dying'.  Probability  of  Dying. 

.522  .005469 

527  .005552 

533  .005647 

540  .005753 

548  .005872 

557  .006004 

567  .006149 

578  .006307 

591  .006490 

606  .006698 

622  .006921 

640  .007171 

660  .007448 

683  .007766 

708  .008113 

734  .008480 

761  .008867 

790  .009287 

822  .009754 

857  .0102693 

894  .0108238 

935  .0114440 

980  .0121337 

1,029  .0128970 

1,083  .0137511 

1,140  .0146767 

1.202  .0157054 

1,270  .0168587 

1,342  .0181200 

1,418  .0194994 

1,501  .0210513 

1,588  .0227504 

1,681  .0246434 


Age. 

No.  Living. 

29 

95,442 

30 

94.92(1 

31 

94,393 

32 

93,8(10 

33 

93,320 

34 

92,772 

35 

92,215 

36 

91,648 

37 

91,070 

38 

90,479 

39 

89,873 

40 

89,251 

41 

88,611 

42 

87,951 

43 

87.268 

44 

86,560 

45 

85,826 

46 

85,065 

47 

84,275 

48 

83,453 

49 

82,596 

50 

81,702 

51 

80,767 

52 

79.786 

53 

78,757 

54 

77,674 

55 

76,534 

56 

75,332 

57 

74,062 

58 

72,720 

59 

71,302 

60 

69,801 

61 

68,213 

62 

66,532 

63 

64,754 

64 

62,874 

1,778  .0267240 
1,880  .0290330 
1,985        .0315741 


r66 


FRATERNAL    SOCIETY    LAW 


Age. 

No.  Living. 

65 

60,889 

66 

58,795 

67 

56.589 

68 

54,271 

69 

51.841 

70 

49,302 

71 

46,657 

72 

43.913 

73 

41,081 

74 

38,172 

75 

35,203 

76 

32.194 

77 

29,168 

78 

26,152 

79 

23,175 

80 

20,270 

81 

17.471 

82 

14.812 

83 

12.327 

84 

10,047 

85 

7,997 

86 

6,197 

87 

4,658 

88 

3,381 

89 

2.358 

90 

1,570 

91 

991 

92 

587 

93 

323 

94 

162 

95 

73 

96 

29 

97 

10 

98 

3 

[1901,  eh.  90, 

§12.] 

No.  Dying.  Probability  of  Dying. 


2,094 

2,206 

2,318 

2.430 

2.539 

2.645 

2,744 

2.832 

2,909 

2.969 

3,009 

3,026 

3,016 

2,977 

2,905 

2,799 

2,659 

2,485 

2,280 

2.050 

1,800 

1,539 

1,277 

1,023 

788 

579 

404 

264 

161 

89 

44 

19 

7 

3 


.0343904 
.0375206 
.0409620 
.0447753 
.0489767 
.0536489 
.0588122 
.0644912 
.0708113 
.0777795 
.0854757 
.(1939027 
.1034010 
.1138345 
.1253506 
.1385163 
.1521951 
.1677694 
.1849599 
.1855707 
.2250844 
.2483460 
.2741520 
.3025732 
.3341815 
.3687898 
.4076690 
.4497445 
.4984*520 
.5493827 
.6027397 
.6551724 
.7000000 
1.0000000 


THE    STATE    OE    NOiriH    DAKOTA  767 

How  Governed. 

Srction  4")82.  Any  such  association,  organized  under  the  laws  of 
this  State,  may  provide  for  the  meetings  of  its  legislative  or  govern- 
ing body  in  any  other  State,  province  or  territory,  wherein  sneh  asso- 
■lation  shall  have  suhnrdiiiate  bodies,  and  all  liiisiiirss  transaeti'(l  at 
siieli  meetings  shall  be  valid  in  all  respects,  as  if  such  meetings  were 
held  within  this  State,  and  where  the  laws  of  any  such  association 
provide  for  the  election  of  its  officers  by  votes  to  be  case  in  its 
subiii-dinate  bodies,  the  votes  so  east  in  its  subordinate  bodies  in  any 
other  State,  province  or  territory,  shall  lie  valid  as  if  cast  within 
this  State.     [1901,  ch.  90,  §  13.] 

Fraudulent  Statements — Penalty. 

Section  4583.  Any  person,  officer,  member  or  examining  physician, 
who  shall  knowingly  or  willfvilly,  make  any  false  or  fraudulent  state- 
ment or  representation,  in  or  with  reference  to  any  application  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit 
in  any  association  transacting  business  under  this  article,  shall  be 
giiii-t,\'  of  a  misdemeanor,  and  upon  conviction  shall  be  punished  by 
a  line  of  not  less  than  one  hundred  dollars,  nor  more  than  five  hun- 
dred dollars,  or  imprisonment  in  the  county  jail  for  not  less  than 
thirty  days,  nor  more  than  one  year,  or  both,  in  the  discretion  of  the 
court;  and  any  person  who  shall  willfully  make  a  false  statement  of 
any  material  fact  or  thing  in  a  sworn  statement  as  to  the  death  or 
disability  of  a  certificate  holder  in  any  such  association,  for  the  pur- 
pose of  procuring  payment  of  a  benefit  named  in  the  certificate  of 
such  holder,  and  any  person  who  shall  willfully  make  any  false  state- 
ment in  any  verified  report  or  declaration,  under  oath,  required  or 
authorized  by  this  article,  shall  be  guilty  of  perjury,  and  shall  be 
proceeded  agaiu.st  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  perjury.     [1901.  ch.  90,  §  14.] 

Refusing  to  Make  Statement — Penalty. 

Section  4584.  Any  such  association  refusing  or  neglecting  to  make 
the  rejiort,  as  provided  in  this  article,  shall  be  excluded  from  doing 


768  FRATERNAL    SOCIETY    LAW 

business  witliiu  this  State.  The  commissioner  of  insurance  must, 
within  sixty  days  after  failure  to  make  such  report,  or  in  case  any 
such  association  shall  exceed  its  powers,  or  shall  conduct  its  business 
fraudulently,  or  shall  fail  to  comply  with  any  of  the  provisions  of 
this  article,  give  notice  in  writing  to  the  attorney  general,  who  shall 
immediately  commence  an  action  against  any  such  association  to  en- 
join the  same  from  carrying  on  any  business.  No  injunction  against 
any  such  association  shall  be  granted  by  an.y  court,  except  on  appli- 
cation by  the  attorney  general,  at  the  request  of  the  commissioner  of 
insurance,  whether  the  State,  or  a  member,  or  other  party,  seeks 
relief.  No  association  so  enjoined  shall  have  authority  to  continue 
business  until  such  report  shall  be  made,  or  overt  act  or  violations 
complained  of  shall  have  been  corrected,  nor  until  the  costs  of  such 
action  be  paid  by  it,  provided  the  court  shall  find  that  such  associa- 
tion was  in  default  as  charged,  whereupon  the  commissioner  of  in- 
surance shall  reinstate  such  association,  and  not  until  then  shall 
such  association  be  allowed  to  again  do  business  in  this  State.  Any 
officer,  agent  or  person  acting  for  any  association  or  subordinate 
body  thereof  within  this  State,  while  such  association  shall  be  so 
enjoined  or  prohibited  from  doing  business  pursuant  to  this  article, 
shall  be  deemed  guilty  of  a  misdemeanor,  and  on  conviction  thereof, 
shall  be  punished  by  a  fine  not  less  than  twenty-five  dollars  nor 
more  than  two  hundred  dollars,  or  by  imprisonment  in  the  county 
jail  for  not  less  than  thirty  days  nor  more  than  one  year,  or  by  both 
such  fine  and  imprisonment,  in  the  discretion  of  the  court.  [1901, 
ch.  90,  §  15.] 

Penalty  for  Failure  to  Comply. 

Section  45S5.  Any  person  who  shall  act  within  this  State,  as  an 
officer,  agent,  or  otherwise,  for  any  association,  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provisions  of  this  article,  or  shall  have  failed  or  neglected 
to  procure  from  the  commissioner  of  insurance  a  proper  certificate 
of  authority  to  transact  business,  as  provided  for  by  this  article,  shall 
be  subject  to  the  penalty  provided  in  the  Inst  preceding  section  for 
the  misdemeanor  therein  specified.     [1901.  cb,  90,  §  16.] 


THE    UTATE    OF    NORTH    DAKOTA  769 

Assessments  Paid  in  Advance,  Application  of  Same. 

Where  a  member  has  obligated  himself  to  pay  the  assessments  that 
may  be  levied,  not  exceeding  a  specified  sum,  and  in  ;iiitieip;ition  of 
assessments  which  are  not  levied  within  the  time  for  which  they  are 
expected  to  be  used,  he  makes  the  payment ;  of  the  amount  so  paid, 
he  has  the  right  to  request  the  sum  to  be  applied  on  assessments 
accruing  for  a  subsequent  period  of  time. 

Montgomery  vs.  Harker.  October,  1900,  9  N.  D.  527;  84  N.  W.  369. 

Non-Contract — Duty  to  Tender  Back  Payments  Made. 

A  contract  of  insurance  contained  the  following  provision  "this 
policy  shall  not  take  effect  unless  the  first  premium  is  actually  paid 
while  the  assured  is  in  good  health."  The  contract  was  made  on 
September  4th  upon  an  application  dated  August  23rd,  and  the  con- 
tract was  delivered,  at  the  request  of  the  applicant,  to  a  third  party, 
on  September  15th.  At  the  request  of  the  member,  said  third  party 
paid  the  premium  of  the  member,  on  September  28th,  and  the  mem- 
ber died,  after  a  sickness  claimed  to  have  been  existing  before  Sep- 
tiuber  15th.  The  premium  paid  on  September  15th  was  received 
at  the  main  office  of  the  society  on  October  12th  and  delivered  about 
October  15th.  The  society  had  no  notice  of  the  change  in  the  mem- 
ber's health.  It  was  held  that  the  society  had  no  right  to  interpose 
the  defence  of  non-liability  without  tendering  back  payment  of  the 
premium  that  was  made. 

Thompson  vs.  Travelers'  Insurance  Co.,  11  N.  D.  274;   91  N.  W.  75. 

Promoters  Acts  Not  Binding  on  Society. 

The  pi'omoters  of  an  insurance  society  are  authorized  and  required 
to  take  a  certain  number  of  applications  before  the  society  is 
deemed  organized,  but  such  promoters  have  no  authority  to  bind  the 
corporation  by  any  contract  before  it  is  organized,  and  authorized 
to  do  business,,  and  a  contract  of  in.surance  signed  by  the  assumed 
president  and  secretary  of  a  corporation  and  delivered  to  the  appli- 
cant for  membership  before  the  corporation  has  come  into  existence 
49 


770  FRATERNAL    SOCIETY    LAW 

and  before  the  officers  could  be  elected  or  the  corporation  enter 
into  binding  contracts,  is  not  enforceable  against  the  company  after 
it  has  been  organized  and  authorized  to  do  business. 

Montgomery  vs.  Whitbeck,  August,  1903,  12  N.  D.  385;  96  N.  W.  327. 

Void  Contracts  Under  Statute  No  Estoppel  in  Pais. 

The  doctrine  of  estoppel  in  pais  does  not  extend  so  far  as  to 
enable  a  person  or  corporation  to  do  in  effect  what  is  forbidden  by 
law  or  what  they  otherwise  are  unable  to  do,  and  therefore  a  party 
to  a  contract  with  a  mutual  society  made  in  violation  of  the  letter 
and  spirit  of  the  statute  under  which  a  corporation  is  organized  and 
authorized  to  do  business  is  not  estopped  to  show  its  illegality  for 
the  purpose  of  preventing  a  recovery  upon  it. 

Montgomery  vs.  Whitbeck,  August,  1903,  12  N.  D.  385;  96  N.  W.  327. 

What  Composes  the  Contract. 

Every  applicant  for  membership  must  take  notice  of  the  law  of  the 
State  under  which  the  society  is  organized,  and  the  statute  of  the 
State  and  articles  of  incorporation  and  by-laws,  and  application  for 
a  certiiicate,  become  parts  of  the  contract  and  binding  upon  the 
member. 

Montgomery  vs.  Whitbeck,  August,  1903,  12  N.  D.  385;  96  N.  W.  327. 

Estoppel — When  is  Doctrine  Applicable. 

In  order  that  the  acceptance  or  retention  of  a  premium  may  estop 
an  insurer  from  relying  upon  the  breach  of  condition  in  the  con- 
tract, it  must  appear  that  the  society  had  knowledge  of  the  facts 
constituting  the  breach. 

Thompson   vs.   Travelers'   Insurance   Co.,   November,   1904,   13   N.   D. 
444;   101  N.  W.  900. 

Applicant,  Duty  of  Respecting  Change  of  Health. 

Where,  pending  negotiation  for  a   contract  of  insurance.   ;i   ma- 


THE    STATE    OF    NORTH    DAKOTA  77] 

teriMl  c-luiiiK'e  in  the  condition  of  the  applicant's  health  occurs,  such 
as  would  infiu('n(U'  tlu;  jndnnicnt  of  the  insiiror  in  accepting  the 
applicant  as  a  risk,  the  appliciint  is  under  obligation  to  make  dis- 
closure of  the  fact. 

Thompson   vs.   Travelers'    Insurance   Co.,   November,   1904,  13   N.   D. 
444;   101  N.  W.  900. 

Actual  Condition  and  Not  Apparent  Health  Governs. 

'  Where  a  life  insurance  contract  contained  tliis  condition:  "This 
])olic.y  shall  not  take  effect  unless  the  first  preuiinni  is  actually  pjiid 
while  the  assured  is  iu  good  health"  it  was  held  in  the  absence  of 
an  estoppel,  that  the  liability  of  the  insurer  depends  upon  the  actual, 
and  not  merely  the  apparent  good  health  of  the  member  when  the 
first  assessment  was  paid. 

Thompson   vs.   Travelers'   Insurance   Co..   November.   1904,   13   N.   D. 
444;    101  N.  W.  900. 

Proofs  of  Death — Value  as  Evidence. 

The  proofs  of  death  and  a  verdict  of  a  coroner's  jury  showed  that 
the  insured  died  from  alcoholic  poisoning,  and  they  were  admitted 
in  evidence  without  ob,ieetion.  Held,  that  they  had  no  probative 
force  because  they  expressed  a  mere  opinion,  based  on  the  same 
evidentiary  facts  as  were  before  the  trial  jury,  and  the  report  of 
death  was  shown  not  to  have  been  prepared  by  or  iu  behalf  of  the 
beneficiary,  and  hence  was  not  to  be  treated  as  an  act  or  admission 
against  interest. 

Puis  vs.  Grand  Lodge  A.  O.  U.  W.,  December,  1904,  13  N.  D.   559; 
102  N.  W.  165. 

Testimony  of  Non-Experts  as  to  Habits  of  Member. 

Testimony  of  persons  who  liy  their  association  with  the  member 
had  an  opportunity  tn  observe  his  habits,  that  they  had  seldom  or 
never  seen  him  driiil';  nr  a])pear  to  be  under  the  influence  of  liquor. 


772  FRATERNAL    SOCIETY   LAW      . 

was  competent  to  show  that  he  was  not  an  habitual  or  immoderate 
drinker. 

Puis  vs.  Grand  Lodge  A.  O.  U.  W.,  December,  1904,  13  N.  D.  559; 
102  N.  W.  165. 

Evidence — Declarations  of  Member  Admissable. 

Voluntary  and  spontaneous  declarations  of  the  deceased  to  those 
in  attendance  upon  him  as  to  the  cause  of  his  illness  due  to  poison 
from  which  he  then  suffered  and  soon  died,  are  admissible  in  evi- 
dence as  ijart  of  the  res  gestae  where  the  circumstances  are  such  as 
to  preclude  the  idea  of  premeditation  or  any  motive  for  falsifying. 

Puis  vs.  Grand  Lodge  A.  O.  U.  W.,  December,  1904,  13  N.  D.  559; 
102  N.  W.  165. 

Suicide — When  Directed  Verdict  Proper. 

Where  the  circumstances  surrounding  the  death  of  a  person  all 
point  to  death  by  suicide,  and  there  are  no  facts  from  which  a  differ- 
ent conclusion  might  reasonably  be  reached  or  inferred,  a  directed 
verdict  that  death  was  caused  by  suicide  will  be  sustained. 

'  Clemens  vs.  Royal  Neighbors  of  America,  February.  1905,  14  N.  D. 

116;    103   N.   W.   402. 

Evidence  as  to  Suicide — Note  in  Member's  Hand  Writing. 

Where  a  note  is  found  in  a  room  where  a  person  is  found  dead,  and 
death  was  caused  by  violence,  and  such  note  is  in  the  hand  writing 
of  the  deceased,  and  gives  direction  as  to  burial  and  other  matters, 
such  note  is  competent  evidence  on  the  question  whether  the  death 
was  suicide  or  not. 

Clemens  vs.  Royal  Neighbors  ot  America,  February.  1905,  14  N.  D. 
116;    103   N.   \V.   402. 

Suicide — Self-Destruction  Defined. 

The   following  language   was   contained   in   a   certificate  "if  the 


THE    STATE    OF    NORTH    DAKOTA  773 

member  holding  this  certificate  shall  <lic  by  any  means  or  not  \vhi<-li 
if  used  or  done  by  such  member  while  iti  the  possession  of  all  natural 
faculties  unimpaired,  would  be  self  destruction,"  then  the  certificate 
should  be  void.  It  was  held  that  the  language  is  equivalent  to  pro- 
viding that  death  by  self  destruction,  whether  sane  or  insane,  voids 
the  contract. 

Clemens  vs.  Roya!  Neighbors  of  America,  February,  1905,  14  N.  D. 
116;    103   N.   W.   402. 


74  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  OHIO. 


CHAPTER  36. 

The  General  Assembl.y  of  Ohio  in  19(1-1:  enacted  an  entire  new  code 
for  fraternal  societies.    The  code  became  law  and  is  as  follows : 

Fraternal  Beneficiary  Associations  Defined. 

Section  1.  Any  corporation,  society,  order  or  voluntary  association 
without  capital  stock,  organized  and  carried  on  solely  for  the  mutual 
benefit  of  its  members  and  their  beneficiaries,  and  not  for  profit,  and 
having  a  lodge  system  with  ritualistic  form  of  work  and  representa- 
tive form  of  government  and  which  shall  make  provision  for  the 
payment  of  death  benefits,  is  hereby  declared  to  be  a  Fraternal  Bene- 
ficiary Association. 

Lodge  System  Defined. 

tSection  '2.  Any  association  having  a  supreme  governing  or  legis- 
lative bod.v  and  subordinate  lodges  or  branches  liy  whatever  name 
known  into  which  members  shall  be  elected  and  initiated  or  admitted 
in  accordance  with  its  constitution,  laws,  rules,  regulations,  and 
prescribed  rituali.stic  ceremonies,  which  subordinate  lodges  or 
branches  shall  be  required  to  hold  regular  or  stated  meetings  at 
least  once  in  eacli  month,  shall  lie  deemed  to  lie  o|)crating  under  the 
lodge  system. 

Representative  Form  of  Government  Defined. 

Section  .3.     Any  association  shall  be  deemed  to  liave  a  representa- 


THE    STATE    OF    OHIO  775 

tive  form  of  government,  when  it  shall  provide  in  its  constitution  and 
hiws  for  a  supreme  legishitive  or  governing  body,  composed  of  repre- 
sentatives elected  either  by  the  members  or  by  delegates  elected 
directly  or  indirectly  by  the  members,  together  with  such  other  mem- 
bers as  may  be  prescribed  by  its  constitution  and  laws,  provided  that 
the  elective  representatives  shall  constitute  a  majority  in  number 
and  have  not  less  than  a  majority  of  the  votes,  nor  less  than  the  votes 
required  to  amend  its  constitution  and  laws,  and  provided  further 
that  the  meetings  of  the  supreme  or  governing  body  and  the  election 
of  officers  shall  be  held  as  often  as  once  in  four  years. 

Exemptions. 

Section  4.  Except  as  herein  provided,  such  association  shall  be 
governed  by  this  act  and  shall  be  exempt  from  all  provisions  of  the 
insurance  laws  of  this  State  not  only  in  governmental  relations  with 
the  State,  but  for  every  other  purpose,  and  no  law  hereafter  passed 
shall  apply  to  them,  unless  they  be  expressly  designated  therein. 

Benefits. 

Section  5.  Every  association  transacting  business  under  this  act 
shall  provide  for  the  payment  of  death  benefits  and  may  provide  for 
the  payment  of  benefits  in  case  of  temporary  or  permanent  physical 
disability,  either  as  the  result  of  disease,  accident  or  old  age,  pro- 
vided, the  period  of  life,  at  which  the  payment  of  benefits  for  disabil- 
ity on  account  of  old  age  shall  commence  shall  not  be  under  seventy 
years. 

Beneficiaries. 

Section  6.  The  payment  of  death  benefits  shall  be  confined  to  the 
family,  heirs,  relatives  by  blood,  marriage  or  legal  adoption,  affianced 
husband  or  affianced  wife,  or  to  a  person  or  persons  dependent  on 
the  member. 

What  Persons  Admitted. 

Section  7.     No  association  shall  admit  to  beneficial  membership 


776  FRATERNAL    SOCIETY    LAW 

any  person  less  than  sixteen  (16)  nor  more  than  sixty  (60)  years  of 
age,  nor  any  person  who  has  not  been  examined  by  a  competent  phy 
sieian  and  whose  examination  has  not  been  supervised  and  approved 
as  provided  by  the  laws  of  the  association. 

Certificate. 

Section  8.  Every  certificate  issued  by  any  association  shall  specify 
the  maximum  amount  of  benefits  provided  thereby,  and  the  condi- 
tions governing  the  payment  thereof,  and  shall  provide  that  the  cer- 
tificate, the  charter  or  articles  of  association,  the  constitution  and 
laws  of  the  association  and  the  application  for  membership  and  med- 
ical examination,  signed  by  the  applicant,  shall  constitute  the  con- 
tract between  the  association  and  the  member  and  copies  of  the  same 
certified  by  the  secretary  of  the  association  or  corresponding  officer 
shall  be  received  in  evidence  of  the  terms  and  conditions  of  the  con- 
tract; and  any  changes,  additions  or  amendments  to  said  charter  or 
articles  of  association,  constitution  or  laws  duly  made  or  enacted 
subsequent  to  the  issuance  of  the  benefit  certificate  shall  bind  the 
member  and  his  beneficiaries  and  shall  govern  and  control  the  eon- 
tract  in  all  respects  the  same  as  though  such  changes,  additions  or 
amendments  had  been  made  prior  to  and  were  in  force  at  the  time 
of  the  application  for  membership. 

Funds. 

Section  9.  Any  association  may  create,  maintain,  disburse  and 
apply  a  reserve,  emergenc.y  or  surplus  fund  in  accordance  with  its 
constitution  and  laws  not  inconsistent  with  the  provisions  of  this  act. 
Unless  otherwise  provided  in  the  contract,  any  such  funds  shall  be 
held,  invested  and  disbursed  for  the  use  and  benefit  of  the  associa- 
tion, and  no  member  or  beneficiary  shall  have  or  acquire  any  in- 
dividual rights  therein,  or  be  entitled  to  an  apportionment  or  the 
surrender  of  anj-  part  thereof.  The  funds  from  which  benefits  shall 
be  paid  and  the  funds  from  which  the  expenses  of  the  association 
shall  be  defrayed,  shall  be  derived  from  periodical  or  other  payments 
by  the  members  of  the  association  and  accretions  of  said  funds;  and 
every   contract   hereafter   made   between   such    association    and    its 


THE    STATE    OF    OHIO  777 

members  shall  provide  that  if  svich  regular  payments  are  insufficient 
to  i)ay  all  matured  death  and  disability  claims  in  full  and  to  provide 
for  tlie  creation  and  maintenance  of  the  funds  required  by  its  consti- 
tution and  laws,  extra  assessments  may  be  levied  upon  the  members 
to  meet  such  deficiency. 

Investment  of  Funds. 

Section  10.  In  investing  its  funds,  a  domestic  association  transact- 
ing business  under  this  act  shall  be  governed  by  paragraphs  one,  two 
and  three  of  Section  3598  and  Sections  3599  and  3600  of  the  Revised 

Statutes. 

Distribution  of  Funds. 

Section  11.  Every  provision  for  payment  Ity  members  of  such  an 
association,  in  whatever  form  made,  shall  distinctly  state  the  pur- 
pose of  the  same  and  the  proportion  thereof  which  may  be  used  for 
expenses,  and  no  part  of  the  money  collected  for  mortuary  or  dis- 
ability purposes  and  no  part  of  the  reserve,  emergency  or  surplus 
funds  (ir  the  net  accretions  of  either  or  any  of  said  funds  shall  be 
used  for  expenses. 

Organization. 

Section  1'2.  Seven  or  more  persons,  citizens  of  the  United  States, 
and  a  majority  of  whom  are  citizens  of  this  State,  who  desire  to  form 
a  Fraternal  Beneficiary  Association,  as  defined  by  this  act,  ma.v  make 
and  sign  (giving  their  addresses)  and  acknowledge  before  some 
officer  competent  to  take  acknowledgment  of  deeds,  articles  of  asso- 
ciation in  which  shall  be  stated  : 

1st.  The  proposed  corporate  name  of  the  association,  which  shall 
not  so  closely  resemble  the  name  of  any  association  or  insurance 
company  already  transacting  business  in  this  State  as  to  mislead  the 
public  or  lead  to  confusion. 

2nd.  The  purpose  for  which  it  is  formed, — which  shall  not  include 
more  liberal  powers  than  are  granted  b.y  this  act,  provided  that  any 
lawful  social,  intellectual,  educational,  moral  or  religious  advantages 


778  FRATERNAL    SOCIETY   LAW 

may  be  set  foi-th  among  the  purposes  of  the  association, — and  the 
mode  in  which  its  corporate  powers  are  to  be  exercised. 

3rd.  The  names,  residences  and  official  titles  of  all  the  officers, 
trustees,  directors  or  other  persons  who  are  to  have  and  exercise  the 
general  control  and  management  of  the  affairs  and  funds  of  the  asso- 
ciation for  the  first  year  or  until  the  ensuing  election  at  which  all 
such  officers  shall  be  elected  by  the  supreme  legislative  or  govern- 
ing body. 

Such  articles  of  association  and  duly  certified  copies  of  the  consti- 
tution and  laws,  rules  and  regulations,  and  copies  of  all  proposed 
forms  of  benefit  certificates,  applications  therefor  and  literature  to 
be  issued  by  such  association,  and  a  bond  in  the  sum  of  five  thousand 
dollars  with  sureties  approved  by  the  Superintendent  of  Insurance, 
conditioned  upon  the  return  of  the  advance  payments,  as  provided 
in  this  section,  to  applicants,  if  the  organization  is  not  completed 
within  one  j-ear,  shall  be  filed  with  the  Superintendent  of  Insurance, 
who  may  require  such  further  information  as  he  deems  necessary, 
and  if  the  purposes  of  the  association  conform  to  the  requirements  of 
this  act  and  all  jsrovisions  of  law  have  been  complied  with,  the  Su- 
perintendent of  Insurance  shall  so  certify  and  retain  and  record  the 
articles  of  association  in  a  book  kept  for  that  purpose  and  furnish 
the  incorporators  a  preliminary  certificate  ai;thorizing  said  associa- 
tion to  solicit  members  as  hereinafter  provided. 

Upon  receipt  of  said  certificate  from  the  Superintendent  of  Insur- 
ance said  association  may  solicit  members  for  the  purpose  of  com- 
pleting its  organization  and  shall  collect  from  each  applicant  the 
amount  of  not  less  than  one  death  benefit  assessment  or  payment,  in 
accordance  with  its  tables  of  rates  as  provided  by  its  constitution 
and  laws,  and  shall  issue  to  each  such  applicant  a  receipt  for  the 
amount  so  collected.  But  no  such  association  shall  incur  any  liabil- 
ity other  than  for  such  advanced  payments,  nor  issue  any  benefit 
certificate  nor  pa.y  or  allow,  or  offer  or  promise  to  pay  or  allow  to 
any  person  any  death  or  disability  benefit  until  actual  bona  fide 
applications  for  death  benefit  certificates  have  been  secured  upon 
at  least  five  hundred  lives  for  at  least  one  thousand  dollars  each  and 
all  such  applicants  for  death  benefits  shall  have  been  regularly  ex- 
amined by  legallj'  qualified  practicing  physicians  and  certificates  of 


THE    STATE    OF    OHIO  779 

siieh  eximiiiKitioiis  liave  been  duly  lilcil  and  ajipi'oved  liy  the  eliief 
medical  examiiief  ol"  sueli  association,  nor  until  there  shall  be  estab- 
lished ten  subordinate  lodges  or  branches  into  whicli  said  five  hun- 
dred applicants  have  been  initiated,  nor  until  there  has  been  sub- 
mitted to  the  Superintendent  of  Insurance,  under  oath  of  the  presi- 
dent and  secretary  or  corresponding  officers  of  such  association  a 
list  of  such  applicants,  giving  their  names,  addresses,  date  examined, 
date  approved,  date  initiated,  name  and  number  of  the  subordinate 
branch  of  vi'hich  each  applicant  is  a  member,  amount  of  benefits  to 
be  granted,  rate  of  regular  payments  or  assessments,  which  shall 
not  be  lower  f(n'  death  benefits  than  those  required  l)y  the  National 
Fraternal  Congress  table  of  mortality,  with  interest  at  four  per  cent. 
per  annum ;  nor  until  it  shall  be  shown  to  the  Superintendent  of  In- 
surance by  the  sworn  statement  of  the  treasurer  or  corresponding 
officer  of  such  association  that  at  least  five  hundr(>d  applicants  have 
each  paid  in  cash  at  least  one  regular  monthly  payment  or  assess- 
ment as  herein  provided  per  one  thousand  dollars^f  indemnity  to  be 
effected,  which  payments  in  the  aggregate  shall  amoiint  to  at  least 
twenty-five  hundred  dollars,  all  of  which  shall  be  credited  to  the 
mortuary  or  disability  fund  on  account  of  such  applicants  and  no 
part  of  which  may  be  used  for  expenses. 

Said  advanced  payments  shall  during  the  period  of  organization  be 
held  in  trust  for  and,  if  the  organization  is  not  completed  within  one 
year  as  hereinafter  provided,  returned  to  said  applicants. 

The  Superintendent  of  Insurance  may  make  such  examination  and 
require  such  further  information  as  he  deems  advi.salile  and  upon 
presenttition  of  satisfaetiH-y  evidence  that  the  association  has  com- 
plied with  all  the  provisions  of  law  he  shall  issue  to  sneh  association 
a  certificate  to  that  effect.  Such  certificate  shall  be  prima  facie  evi- 
dence of  the  existence  of  .such  association  at  the  date  of  such  certifi- 
cate. The  Superintendent  of  Insurance  shall  cause  a  record  of  such 
certificate  to  be  made  and  a  eertitied  copy  of  such  record  may  be 
given  in  evidence  with  like  effect  as  the  original  certificate. 

No  preliminary  cei'tificate  granted  under  the  provisions  of  this 
section  shall  be  valid  after  one  year  from  its  date,  or  after  such 
fiu'ther  period,  not  exceeding  one  year,  as  may  be  authorized  by  the 
Superintendent  of  Insurance,  upon  cause  shown,  unless  the  five  h\ui- 


780  FRATERNAL    SOCIETY    LAW 

dred  ;ii>plicaiits  herein  required  liavc  been  seeured  ;md  tlie  (trganiza- 
tioii  has  been  completed  as  lierein  providrd,  and  the  articles  of  asso- 
ciation and  all  proceedings  thereunder  shall  become  null  and  void  in 
one  j'ear  from  the  date  of  said  preliminary  certificate,  or  at  the  ex- 
piration of  said  extended  period,  unless  such  association  shall  have 
completed  its  organization  and  commeilced  business  as  herein  jtro 
vided.  When  any  domestic  association  shall  have  discontinued  busi- 
ness for  the  period  of  one  year,  its  charter  shall  become  null  and  void. 

Powers  Retained — Reincorporation — Amendments. 

Section  13.  Any  association  now  engaged  in  transacting  business 
in  this  State,  may  exercise,  after  the  passage  of  this  act,  all  of  the 
rights  conferred  thereby,  and  all  of  the  rights,  powers  and  privileges 
now  exercised  or  possessed  by  it  under  its  charter  or  articles  of  asso- 
ciation not  inconsistent  with  this  act.  or  it  may  be  re-incorporated 
hereunder.  But  no  association  already  organized,  shall  be  required 
to  re-incorporate  hereunder,  nor  shall  it  be  required  to  adopt  the 
rates  prescribed  herein  for  new  associations,  in  order  to  avail  itself 
of  the  privileges  of  this  act,  and  any  such  association  may  amend  its 
articles  of  association  from  time  to  time  in  the  manner  provided 
therein,  or  in  its  constitution  or  laws,  and  all  such  amendments  shall 
be  filed  with  the  Superintendent  of  Insurance  and  shall  become  op- 
erative upon  such  filing  unless  a  later  tibe  be  provided  in  such 
amendments,  or  in  its  articles  of  association,  constitution  or  laws. 

Transfer  of  Membership. 

Section  14.  No  domestic  association  shall  transfer  its  membership 
or  funds  to  any  association  not  aiithorized  by  the  Superintendent  of 
Insurance  to  transact  business  in  this  State ;  nor  shall  any  such  asso- 
ciation tranfer  its  membership  or  fiiiids  to  any  licensed  association, 
unless  the  said  contract  of  transfer  has  been  ajiproved  by  a  two- 
thirds  vote  of  the  meinbers  of  the  supreme  body  of  the  association 
whose  membershi])  is  proposed  to  be  transferred:  and  by  a  two-thirds 
vote  of  the  trustees  or  board  having  charge  of  the  association  pro- 
])osing  to  take  such  membership. 


THE    STATE    OF    OHIO  781 

Eemedies. 

Seetiou  1").  No  member  of  any  assoeiatidii  oi'<iaiii/,e(l  or  operating 
uuder  the  provisions  of  this  act,  or  his  beneficiary,  or  his  lefial  i'e|)i-e- 
sentatives,  or  any  other  person  in  any  way  interested  in  any  of  his 
benefits,  or  any  person  deriving  legal  rights  from  liiin,  shall  com- 
mence any  action  or  other  legal  proceedings  in  any  of  the  courts  of 
this  State,  on  account  of  his  contract  of  insurance,  against  the 
siii)reine  or  governing  body  of  such  association,  until  after  he  shall 
have  exhausted  all  the  remedies  |)rovi(letl  in  llie  constitution  and 
laws  of  Huch  association  b.v  appeals  and  otherwise,  that  can  be  deter- 
mined within  one  .vear  after  the  filing  of  proof  of  death  or  disability. 

Annual  License. 

Section  16.  Associations  which  are  now  authorized  to  transact 
business  in  this  State  may  continue  such  business  until  the  first  da.v  of 
April  next  succeeding  the  passage  of  this  act,  and  the  a\ithority  of 
sucli  associati(Uis  mav  thereafter  be  renewed  annuall.v.  but  in  all 
cases  to  terminate  on  the  first  da,\-  of  the  snececding  Ai)ril.  For  each 
such  license  or  renewal,  the  association  shall  ])a.'.'  the  su]ierintendent 
of  insurance  twent.v-five  dollars.  A  duly  certified  copy  of  such 
license  shall  be  prima  facie  evidence  that  the  license  is  a  Fraternal 
Beneficiary  Association  within  the  meaning  of  this  act. 

Admission  of  Foreign  Associations. 

.Section  17.  No  foreign  association  now  transacting  business, 
organized  prior  to  the  pa,ssage  of  this  act,  which  is  uot  now  author- 
ized to  transact  business  in  this  State,  shall  transact  any  business 
therein  without  a  license  from  the  Superintendent  of  Insurance.  Any 
such  association  shall  be  entitled  to  a  license  to  transact  business 
within  this  State  upon  filing  with  the  Superintendent  a  duly  certified 
cop.v  of  its  charter  or  articles  of  association ;  a  copy  of  its  constitution 
or  laws,  certified  by  its  secretary  or  corresponding  officer;  a  power 
of  attorne.v  to  the  Su]ierintendent  as  hereinafter  provided;  a  state- 
ment, under  oath,  of  its  president  and  secretary  or  corresponding 
officer,  iu  the  form  required  by  the  Superintendent,  dul.v  verified  by 


782  FRATERNAL    SOCIETY    LAW 

an  examination  made  by  the  supervising  insurance  official  of  its 
home  State  of  its  business  for  the  preceding  year;  a  certificate  from 
the  proper  official  in  its  home  State,  province  or  country,  that  the 
association  is  legally  organized ;  a  copy  of  its  contract,  which  nuist 
show  that  benefits  are  provided  for  by  assessments  upon,  or  other 
payments  by,  persons  holding  similar  contracts  and  upon  furnishing 
the  Superintendent  such  other  information  as  he  may  deem  neces- 
sar.y  to  a  proper  exhibit  of  its  business  and  plan  of  working,  and 
upon  showing  that  its  assets  are  invested  in  accordance  with  the 
laws  of  the  State,  territory,  district,  provijice  or  country  where  it 
is  organized,  he  shall  issue  a  license  to  such  association  to  do  business 
in  this  State  until  the  first  day  of  the  succeeding'  April,  and  such 
license  shall,  upon  compliance  with  the  provisions  of  this  act,  be 
renewed  annually,  but  in  all  cases  to  terminate  on  the  first  day  of 
the  succeeding  April.  Nothing  contained  in  this  act  shall  in  any 
manner  be  so  construed  as  to  require  any  such  foreign  association, 
not  now  authorized  to  transact  business  in  this  State  to  conform  its 
rates  of  assessment,  to  those  presci'ibed  bj-  the  National  Fraternal 
Congress  mortality  table  as  a  condition  precedent  to  the  securing 
of  such  license  or  an.y  renewal  thereof.  Any  foreign  association 
hereafter  organized,  desiring  admission  to  this  State,  shall  in  addi- 
tion to  the  foregoing  requirements  of  this  section,  show  that  it  col- 
lects from  all  of  its  members  for  death  benefits,  assessments  not  lower 
than  those  retjuired  b.y  the  National  Fraternal  Congress  mortality 
table,  with  interest  at  four  per  cent.,  and  shall  have  \ho  further  quali- 
fications required  of  domestic  associations  organized  under  this  act 
and  have  its  assets  invested  as  required  by  the  laws  of  the  State,  ter- 
ritory, district,  country  or  province  where  it  is  organized.  For  each 
such  license  or  renewal,  the  association  shall  pay  the  Superintendent 
twenty-five  dollars.  When  the  Superintendent  refuses  to  license  any 
•association,  or  revokes  its  authority  to  do  business  in  this  State,  he 
shall  reduce  his  ruling,  order  or  decision  to  writing  and  file  the  same 
in  his  office,  and  shall  furnish  a  copy  thereof,  together  with  a  state- 
ment of  his  reasons,  to  the  officers  of  the  association,  iqion  request, 
and  the  action  of  the  Superintendent  shall  be  reviewable  by  jiroper 
proceedings  in  any  court  of  comiietent  jurisdiction  within  this  State; 
provided,  however,  thai   nutliing  contained  in  this  or  the  preceding 


THE    STATE    OF    OHIO  783 

section  shall  be  taken  or  construed  as  preventing  any  such  associa- 
tion from  continuing  in  good  faith  all  contracts  made  in  this  State 
during  the  time  such  association  was  legally  authorized  to  transact 
business  therein. 

Power  of  Attorney  and  Service  of  Process. 

Section  18.  Every  foreign  association  now  transacting  business  in 
til  is  State  shall  within  thirty  days  after  the  passage  of  this  act  and 
every  such  association  hereafter  applying  for  admission,  shall  before 
being  licensed,  appoint  in  writing  the  Superintendent  of  Insurance 
and  his  successors  in  office  to  be  its  true  and  lawful  attorney  upon 
whom  all  legal  process  in  an.y  action  or  proceeding  against  it  siiall 
be  served  and  in  such  writing  shall  agree  that  any  lawful  process 
against  it,  which  is  served  upon  such  attorney  shall  be  of  the  same 
legal  force  and  validity  as  if  served  upon  the  association,  and  that 
the  authority  shall  continue  in  force  so  long  as  any  liability  remains 
outstanding  in  this  State. 

Copies  of  such  appointment,  certified  by  said  superintendent  of 
insurance,  shall  be  deemed  sufficient  evidence  thereof  and  shall  be 
admitted  in  evidence  with  the  same  force  and  effect  as  the  original 
thereof  might  be  admitted.  Service  may  only  be  made  upon  such 
attorney,  must  be  made  in  duplicate  and  shall  be  deemed  sufficient 
service  upon  such  association,  provided,  however,  that  no  such 
service  shall  be  valid  or  binding  against  any  such  association  when  it 
is  rci|uired  thereunder  to  file  its  answer,  pleading  or  defense  in  less 
than  thirty  days  after  the  date  of  such  service.  When  legal  process 
against  any  such  association  is  served  upon  said  Superintendent  of 
Insurance,  he  shall  forthwith  forward  by  registered  mail  one  of  the 
duplicate  copies,  prepaid  and  directed  to  its  secretary  or  correspond- 
ing officer.  The  plaintiff  in  such  process  so  served  shall  pay  to  the 
Superintendent  of  Insurance  for  the  use  of  the  State  at  the  time  of 
such  service  a  fee  of  two  dollars,  which  shall  be  recovered  by  him  as 
part  of  the  taxable  costs,  if  he  prevails  in  the  suit. 

Place  of  Meeting — Location  of  Office. 

Section  19.    Any  domestic  association  may  provide  that  the  meet- 


784  FRATERNAL    SOCIETY    LAW 

ings  of  its  legislative  or  governing  body  may  be  held  in  any  State, 
district,  province  or  territory  wherein  such  association  has  sub- 
ordinate branches,  and  all  business  transacted  at  such  meetings  shall 
be  as  valid  in  all  respects  as  if  such  meetings  were  held  in  this 
State.    But  its  principal  office  shall  be  located  in  this  State. 

No  Personal  Liability. 

Section  20.  Officers  and  members  of  the  supreme,  grand,  or  any 
subordinate  body  of  any  such  incorporated  association  shall  not  be 
individuallj-  liable  for  the  payment  of  any  disability  or  death  benefit, 
provided  for  in  the  laws  and  contracts  of  such  association,  but  the 
same  shall  be  payable  only  out  of  the  funds  of  such  association  and 
in  the  manner  provided  by  its  laws. 

Waiver  of  the  Provisions  of  the  Laws. 

Section  21.  The  constitution  and  laws  of  the  association  may  pro- 
vide that  no  subordinate  body,  nor  any  of  its  officers  or  members 
shall  have  the  power  or  authority  to  waive  any  of  the  provisions  of 
the  laws  and  constitution  of  the  association,  and  the  same  shall  be 
binding  on  the  association  and  each  and  every  member  thereof. 

Separate  Jurisdiction  Provisions. 

Section  22.  All  grand  lodges  by  whatever  name  known,  whether 
incorporated  or  not,  holding  charters  from  a  supreme  governing 
body,  which  are  conducting  business  in  this  State  upon  the  passage 
of  this  act  as  a  Fraternal  Beneficiary  Association  upon  what  is 
known  as  the  separate  jurisdiction  plan,  shall  be  treated  as  a  federa- 
tion of  grand  lodges  and  not  as  single  State  organizations,  and  all 
reports  required  by  the  provisions  of  this  act  shall  be  made  and 
furnished  l)y  the  officers  of  such  supreme  governing  body  and  shall 
embrace  and  contain  the  transactions,  liabilities  and  assets  of  the 
entire  order. 

Constitution  and  Laws — Amendments. 

Section  23.    Every  association  transacting  business  under  this  act 


THE    STATE    OF    OHIO  735 

sli.-ill  lilc  with  the  Suix'rintendent  ol'  Iiisuimikv  ;i  duly  cert  ilicil  copy 
of  mII  aiiiendinciit.s  of.  oi' nchlitions  to,  its  coiistit  lit  ion  jiiid  l;i\vs  within 
ninety  days  after  the  enaetnieiit  of  the  same.  Printed  eojiies  of  tlie 
constitution  and  hiws  and  of  additions  or  amendments  thereto,  certi- 
fied by  the  secretary  or  corresponding  olficer  of  the  association  shall 
1)0  prima  facie  evidence  of  the  legal  a(lo]itioii  thereof. 

Annual  Reports. 

Section  24:.  Ever.y  association,  transacting  business  in  this  Slate, 
shall  annually  on  or  before  the  first  day  of  March  file  with  the  Super- 
intendent of  Insurance  in  such  f(U-in  as  he  may  rc(|iiire.  a  statement 
untler  oath  of  its  president  and  secretarx',  or  corresponding  otfieers 
of  its  conditicni  and  standing  on  the  thirty-tirst  day  of  December 
next  preceding  and  of  its  transactions  for  the  year  ending  on  that 
date,  and  shall,  also,  furnish  such  other  information  as  the  Superin- 
tendent may  deem  necessary  to  a  ])roper  exhibit  of  its  business  and 
plan  of  working.  The  Superintendent  may  at  other  times  require 
any  fin-ther  stateinent  he  may  deem  necessary  to  be  made  relating 
to  such  associations. 

Examination  of  Domestic  Associations. 

Section  25.  The  Superintendent  of  Insurance,  or  any  person  he 
may  appoint,  shall  have  the  power  of  visitation  and  examination 
into  the  atfairs  of  any  dcnnestic  association.  lie  ma.\'  employ  assist- 
ants for  the  purposes  of  such  examination  ami  he.  oi'  any  person  he 
may  appoint,  shall  have  free  access  to  all  the  books,  papers  and 
documents  that  relate  to  the  business  of  the  association  and  may 
summon  and  (|ualify  as  witnesses  umler  oath  and  examine  its  officers, 
agents  and  employees  or  other  persons  in  relation  to  the  affairs, 
transactions  and  condition  of  the  association.  The  expenses  of  snch 
examination  shall  be  paid  by  the  State  Treasurer  on  the  warrant  of 
the  State  Auditor  on  the  certificate  of  the  Superintendent  of  Insur- 
ance from  the  proper  appropriation. 

Whenever  after  examination  the  Superintendent  is  satisfied  that 
any  domestic  association  has  failed  to  comply  with  any  provision  of 
50 


786  FRATERNAL    SOCIETY    LAW 

this  law  or  is  exceeding-  its  powers;  or  is  not  carrying  out  its  con- 
tracts in  good  faith;  or  is  transacting  business  fraudulently;  or 
whenever  any  domestic  association,  after  the  existence  of  one  year 
or  more  shall  have  a  membership  of  less  than  three  hundred,  or 
votes  to  discontinue  business,  the  Superintendent  of  Insurance  may 
present  the  facts  relating  thereto  to  the  Attorney  General,  who  shall, 
if  he  deem  the  circumstances  warrant,  commence  an  action  in  quo 
warranto  in  a  court  of  competent  jurisdiction  and  such  court  shall 
thereupon  notify  the  officers  of  such  association  of  a  hearing,  and, 
unless  it  shall  then  appear  that  some  special  and  good  reason  exists 
why  such  association  should  not  be  closed,  said  association  shall  be 
enjoined  from  carrying  on  any  further  business,  and  some  person 
shall  be  appointed  receiver  of  such  association  and  shall  proceed  at 
once  to  take  possession  of  the  books,  papers,  moneys,  and  other 
assets  of  the  association  and  shall  forthwith,  under  the  direction  of 
the  court,  proceed  to  close  the  affairs  of  the  association  and  to  dis- 
tribute its  funds  to  those  entitled  thereto.  No  such  proceeding  shall 
be  commenced  by  the  Attorney  General  against  any  such  association 
until  after  notice  has  been  duly  served  on  the  chief  execiitive  officers 
of  the  association  and  a  reasonable  opportunity  given  to  it  on  a 
date  to  be  named  in  said  notice  to  show  cause  why  such  proceedings 
should  not  be  commenced. 

Application  for  Receiver,  Etc. 

Section  26.  Xo  application  for  injunction  or  other  proceedings  for 
the  dissolution  of.  or  the  appointment  of  a  receiver  for.  any  such 
dome.stic  association  or  branch  thereof  shall  be  entei'tained  by  any 
covirt  in  this  State  unless  the  same  is  made  by  the  Attorney  General. 

Examination  of  Foreign  Associations. 

Section  27.  The  Superintendent  of  Insurance,  or  any  person  whom 
he  may  appoint,  may  examine  an.y  foreign  association  transacting 
or  applying  for  admission  to  transact  business  in  this  State.  The 
Superintendent  may  employ  assistants  for  the  {)urpose  of  such  exam- 
ination and  he,  or  any  person  he  may  ajjpoint.  shall  have  free  access 
to  all  the  books,  papers  and  docunu'uts  that  relate  to  the  business  of 


THE    HTATE    OF    OHIO  787 

till'  jissdciat ion  ami  may  suiniiioii  and  (inalil'y  as  witnesses  under 
oath  and  examine  its  oi'licers,  aj^'ents,  employes  and  othei'  persons  in 
relation  to  the  affairs,  transactions  and  eondilion  of  the  association. 
He  may  in  his  discrelion  accept  in  lien  oT  such  examinatimi  the 
examination  of  the  Insurance  D<'i)artment  of  the  .State,  territory, 
distriet,  province  or  country  where  such  association  is  organized. 
All  examinations  made  under  the  provisions  of  this  section  shall  be 
made  without  expense  to  the  association  examined. 

If  any  such  association  or  its  officers  refuse  to  submit  to  such  ex- 
amination or  to  comply  with  the  provisions  of  this  section  relating 
thereto,  the  aiithority  of  such  association  to  transact  business  in  this 
State  shall  be  revoked  until  satisfactory  evidence  is  furnished  the 
Superintendent  relating  to  the  condition  and  affairs  of  the  associa- 
tion and  during  such  revocation  the  association  shall  not  transact 
any  business  in  this  State. 

Revocation  of  License. 

Section  "iS.  When  the  Snperiideiident  on  investigation  is  satisfied 
that  any  foreign  association  transacting  business  under  this  act  has 
exceeded  its  powers,  or  has  failed  to  comjily  with  any  j^rovision  of 
this  law,  or  is  conducting  business  fi'andulentl>',  or  is  not  carrying 
out  its  contracts  in  good  faith,  he  shall  notify  the  president  and 
secretary,  or  other  officers  correspiuuling  thereto,  of  his  findings,  and 
state  in  writing  the  grounds  of  his  dissatisfaction  and  after  reason- 
able notice  require  said  association  on  a  date  named  to  show  cause 
why  its  license  should  not  be  revoked.  If  on  the  date  named  in  said 
notice  such  objections  have  not  been  removed  to  the  satisfaction  of 
the  Superintendent,  or  the  association  does  not  present  good  and 
sufficient  reasons  why  its  authority  to  transact  business  in  this  State 
should  not  at  that  time  be  revoked,  he  may  revoke  the  authorit\- 
of  the  association,  to  continue  business  in  this  State.  All  decisions 
and  findings  of  the  Superintendent  made  under  the  provisions  of  this 
section  may  be  reviewed  liy  proper  jiroceedings  in  any  court  of 
com|)etent  .iurisdiction  as  ])rovided  in  section  seventeen  of  this  act. 


788  FRATERNAL    SOCIETY    LAW 

Exemption  of  Certain  Associations. 

Section  29.  Nothing  contained  in  this  act  shall  be  construed  to 
afltect  or  apply  to  grand  or  subordinate  lodges  of  Masons,  Odd  Fel- 
lows or  Knights  of  Pythias  (exclusive  of  the  insurance  branch  i>f 
the  Supreme  Lodge  Knights  of  Pythias)  or  to  similar  orders  which 
di)  not  issue  insurance  certificates,  nor  to  local  lodges  of  an  associa- 
tion now  doing  business  in  this  State,  that  provide  death  benefits 
not  exceeding  three  hundred  dollars  to  any  one  person,  or  disability 
benetits  not  exceeding  three  hundred  dollars  in  any  one  year  to  any 
one  jjerson,  or  Ixitli.  nor  to  any  contracts  of  I'l-insurance  of  or  be- 
tween such  local  lodges  of  such  association  now  doing  business  on 
such  plan  in  this  State,  nor  to  domestic  a.ssociatioi»<  which  limit 
their  membership  to  the  employes  of  a  particular  city  or  town,  desig-  ■ 
nated  firm,  business  house  or  corporation ;  nor  to  domestic  lodges, 
orders,  or  associations  of  a  purely  religious,  charitable  and  benevo- 
lent description,  which  do  not  operate  with  a  view  to  profit  and 
which  do  not  jn-ovide  for  a  death  benefit  of  more  than  one  hiuidred 
dollars,  or  for  disability  benefits  of  more  than  one  hundred  and  fifty 
dollars  to  any  one  person  in  any  one  year,  provided  always  that  any 
such  domestic  order  or  association  which  has  more  than  five  hiuidred 
members,  and  provides  for  death  oi'  tlisability  benefits  and  any  such 
domestic  lodge,  order  or  a.ssociation  which  issues  to  any  person  a  cer- 
tificate providing  for  the  payment  of  benefits,  shall  not  be  exempt 
by  the  provisions  of  this  section,  but  shall  comply  with  all  the  re- 
quirements of  this  act.  The  Superintendent  of  Insurance  may  re- 
quire from  any  association  such  information  as  will  enable  him  to 
determine  whether  such  association  is  exempt  from  the  provisions  of 
this  act.  No  association  which  is  exempt  by  the  provision  of  this 
section  from  the  requirements  of  this  act  shall  give  or  allow  or  prom- 
ise to  give  oi'  allow  to  any  person  any  comiiensation  for  procuring 
new  members. 

Penalties. 

Section  30.  Any  person,  officer,  member  or  examining  physician, 
who  shall  knowingly  or  willfully  make  any  false  or  fraudulent  state- 
ment or  representation  in  oi-  with  I'ei'erence  to  any  ajjplication  for 


THE    STATE    OF    OHIO  789 

membership,  or  for  the  jiurposi^  of  nbtMiniiiu-  money  I'nnn  or  heiiefit 
ill  any  association  transactini;'  husiin'ss  umler  this  act.  shall  be  <juilty 
of  a  inisdenieanor  and  upon  eonvicitioii  thereof,  shall  be  piinisluHl  by 
a  fine  of  not  less  than  one  hundred  dollars  nor  more  than  five  hun- 
dred dollars,  or  imprisonment  in  the  county  jail  for  not  less  than 
thirty  days  nor  more  than  one  year,  or  both,  in  the  discretion  of  the 
court,  and  any  person  who  shall  wilfully  make  a  false  statement  of 
any  material  fact  or  thing  in  a  sworn  statement  as  to  the  death  or 
disability  of  a  certificate  holder  in  any  such  association,  for  the  piir- 
I>ose  of  procuring  iiayment  of  a  benefit  named  in  the  certificate  of 
such  holder,  and  any  person  who  shall  wilfully  make  any  false  state- 
ment in  any  -verified  report  or  declaration  under  oath  required  or 
authorized  by  this  act,  shall  be  p-uilty  of  perjury,  and  shall  be  pro- 
ceeded against  and  punished  as  provided  by  the  statutes  of  this 
State  in  relation  to  the  crime  of  perjury. 

Any  person  who  shall  solicit  membership  for,  or  in  any  manner 
assist  in  jirocuring  membership  in,  any  association  not  licensed  to  do 
business  in  this  State;  or  who  shall  solicit  membership  for,  or  in  any 
manner  assist  in  procuring  membership  in,  any  svich  association  not 
authorized  as  herein  provided,  to  do  business  as  herein  defined  in  this 
State,  shall  be  guilty  of  a  misdemeanor  and  upon  conviction  thereof 
shall  be  punished  by  a  fine  of  not  less  than  fifty  nor  more  than  two 
liundred  dollars. 

Any  association,  or  any  officer,  agent  or  employee  thereof,  neglect- 
ing or  refusing  to  comply  with,  or  violating  any  of  the  provisions  of 
this  act,  the  penalty  for  which  neglect,  refusal  or  violation  is  not 
specified  in  this  section,  shall  be  fined  not  exceeding  two  himdred 
dollars  upon  conviction  thereof. 

Construction. 

Section  31.  The  word  "association"  as  used  in  this  act  shall  be 
taken  and  construed  as  meaning  a  fraternal  beneficiary  corporation, 
society,  order  or  voluntary  association  as  defined  in  Section  1.  The 
words  "domestic  association"  shall  be  taken  and  construed  as  mean- 
ing an  association  organized  or  incorporated  under  the  laws  of  this 
State.     The  words  "foreign   association"  shall  be  taken  and  con- 


790  FRATERNAL    SOCIETY    LAW 

strued  as  meaning  an  association  organized  or  incorporated  under 
the  laws  of  another  territory,  district,  State,  province  or  country. 
All  provisions  of  each  section  of  this  act  except  as  otherwise  pro- 
vided shall  be  taken  and  construed  as  applying  to  both  domestic  and 
foreign  associations. 

In  the  event  of  a  vacancy  in  the  ofSce  of  the  Superintendent  of 
Insurance  or  in  the  absence  or  disability  of  that  officer  the  Deputy 
Superintendent  of  Insurance  shall  perform  all  the  duties  required 
of  the  Superintendent  by  this  act. 

Section  32.  The  act  of  the  General  Assembly  of  the  State  of  Ohio 
entitled  "An  act  regulating  Fraternal  Beneficiary  societies,  orders 
and  associations,"  passed  April  27,  1896  (Sections  3631-11,  3631-12, 
3631-13,  3631-14,  3631-15,  3631-16,  3631-17,  3631-18,  3631-19,  3631-20,  • 
3631-21,  3631-22  and  3631-23,  Revised  Statutes)  and  the  act  of  the 
General  Assembly  of  the  State  of  Ohio  entitled  "An  act  to  amend 
Section  3631-13  of  the  Revised  Statutes  of  Ohio,"  passed  May  12, 
1902,  be  and  the  same  are  hereby  repealed. 

By-law  of  Limitations  Valid. 

The  parties  to  a  contract  of  insurance  may  by  apt  terms  lawfully 
limit  the  time  within  which  suit  may  be  brought  thereon,  provided 
the  period  of  limitation  fixed  be  not  unreasonable. 

Appel   vs.   Cooper   Ins.   Co.,    Supreme  Court  of  Ohio,   Feb.,   1907,  80 
N.  K.  955. 

Limitation  By-law  for  Bringing  Suit  Valid. 

A  clause  in  a  contract  that  "no  .suit  or  action  on  this  policy  for 
the  recovery  of  any  claim  shall  be  sustainable  in  any  court  of  law 
or  equity  until  after  full  compliance  by  the  insured  with  all  the  fore- 
going requirements,  nor  unless  commenced  within  six  months  next 
after  the  fire,"  is  unambiguous,  and  a  suit  on  the  policy  commenced 
more  than  six  months  after  the  fire  will  not  be  enforced. 

Appel   vs.   Cooper   Ins.   Co.,   Supreme  Court  of  Ohio,   Feb.,   1907,  80 
N.  E.  955. 


THE    STATE    OF    OHIO  791 

Conditions  Precedent  to  Liability. 

A  provision  in  a  contract  that  the  certificate  "shall  not  take  effect 
until  after  the  first  premium  shall  have  been  pair!  to  and  accepted 
by  the  company  or  authorzed  agent,"  is  valid,  and  the  payment  of 
such  premium,  unless  waived,  is  necessary  to  put  the  contract  in 
force. 

State  Life  Ins.  Co.  vs.  Harvey,  March,  1905,  72  Ohio,  St.  174. 

Suicide  By-law  Reasonable. 

A  by-law  adopted  by  a  society  which  provides  that  a  certificate 
issued  to  a  member  shall  be  void  and  all  benefits  thereunder  for- 
feited in  case  the  insured  shall  die  by  suicide,  felonious  or  other- 
wise, sane  or  insane,  is  consistent  with  the  purposes  of  the  society 
and  with  its  corporate  charter,  and  imposes  a  reasonable  condition 
upon  which  the  parties  to  the  contract  may  agree. 

Tisch  vs.  Protected  Home  Circle,  March,  1905,  72  Ohio  St.  233. 

After-enacted  Suicide  Law  Valid. 

An  after-enacted  suicide  by-law  is  valid  and  violates  no  vested 
rights  of  beneficiaries  under  certificates  theretofore  issued. 

Tisch  vs.  Protected  Home  Circle,  March,  1905,  72  Ohio  St.  233. 

Foreign  Society's  Right  to  State  License. 

Where  a  society  is  organized  in  another  State,  province  or  terri- 
tory, under  laws  which  provide  for  such  societj-'s  operating  within 
the  description  of  a  fraternal  beneficiary  society,  as  set  forth  in  the 
Ohio  statutes,  is  shown  by  certificate  to  be  authorized  to  do  business 
in  that  State  or  country,  and  is  not  now  doing  business  within  this 
State,  such  society  has  a  right  to  be  admitted  to  do  business  within 
this  State  when  it  shall  have  filed  Avith  the  Superintendent  of  Insur- 
ance a  duly  certified  copy  of  its  charter  and  articles  of  incorporation 
and  copy  of  its  constitution  and  laws,  properly  certified,  and  an 
appointment  of  the  superintendent  of  insurance  as  the  person  upon 


792  FRATERNAL    SOCIETY    LAW 

whom  process  may  be  served — under  such  circumstances  it  is  man- 
datory, under  the  Ohio  statute,  upon  the  Superintendent  of  Insur- 
ance to  issue  to  the  society  a  certificate  authorizing  it  to  do  business 
within  the  State  of  Ohio. 

The  State   ex   rel.   Great  Camp,   Knights    of   Modern   Maccabees  vs. 
Vorys,  Supt.  of  Ins.,  Oct.,  1903,  69  Ohio  St.  56. 

General  Insurance  Laws  Inapplicable. 

The  insurance  laws  of  the  State  are  not  applicable  to  fraternal 
beneficiary  societies,  "so  that  fraternal  beneficiary  associations  have 
a  law  unto  themselves,  and  neither  the  insurance  laws  nor  the  con- 
struction thereof  are  applicable  to  them  unless  expressly  made  so." 

The  State   ex   rel.   Great  Camp,   Knights   of   Modern  Maccabees  va. 
Vorys,  Supt.  of  Ins.,  Oct.,  1903,  69  Ohio  St.  56. 

Members  Signing  of  Laws  not  Essential. 

In  order  to  defeat  a  suit  upon  a  contract  to  recover  assessments 
made  by  the  society  on  the  contract,  the  assured  cannot  deny  his  lia- 
bility for  the  sole  reason  that  he  did  not  sign  the  constitution  and 
laws  which  provided  for  the  levying  of  assessments. 

Richards,  Receiver,  etc.  vs.  Louis  Lipp  Co.,  Jan.,  1904,  69  Ohio  St.  359. 

Conditions  Precedent  to  Liability. 

Where  a  contract  of  insurance  has  a  condition  to  the  effect  that 
the  company  assumes  no  obligation  unless  the  insured  is  at  the 
date  of  the  policy  alive  and  in  sound  health,  and  there  is  an  issue 
as  to  whether  at  that  time  the  insured  was  in  sound  health,  the  com- 
pany is  entitled  upon  the  trial  to  have  the  jury  instructed  uncon- 
ditionally to  find  for  tlie  company  in  case  the.v  find  that  the  insured 
was  not  in  sound  healtli  at  the  date  of  the  policy. 

Metropolitan  Life   Ins.   Co.  vs.   Howie,   June,   1903,   68  Ohio  St.  614. 


THE    STATE    OF    OHIO  793 

Evidence — Confidential  Relations  Between  Physician  and  Patient. 

It  is  not  coiiiiietent  to  prove  by  a  physician  the  communications 
made  to  him  by  liis  i)atient  in  that  relation,  but  such  physician  may 
testify  as  to  facts  which  are  within  his  knowledge  independent  of 
such  communications,  and  he  may  testify  to  the  condition  and 
state  of  health  of  his  patient  as  well  as  the  treatment  prescribed 
by  him. 

Metropolitan  Life   Ins.   Co.  vs.   Howie,   June,   1903,   68  Ohio   St.   614. 

Exemption  from  Debt — Statute  Unconstitutional. 

The  following  provision  of  the  Ohio  law  was  declared  nnconstitu- 
tional : 

"The  money  or  other  benefit,  charity,  relief  or  aid  to  be  paid, 
provided  or  rendered  by  any  association  authorized  to  do  business 
under  this  act  shall  not  be  liable  to  attachment  by  any  trustee,  gar- 
nishee or  other  process,  and  shiill  not  be  seized,  taken,  appropriated 
or  applied  by  any  legal  or  equitable  process,  or  by  process  of  law, 
to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any  bene- 
ficiary named  in  the  certificate,  or  any  person  Avho  may  have  any 
rights  thereunder." 

The  question  arose  in  a  suit  involving  a  Royal  Arcanum  certificate. 
The  court  said : 

"No  such  exemption  is  provided  with  respect  to  any  ordinary 
life  policy,  nor  with  respect  to  a  certificate  of  an  association  doing 
business  on  a  weekly  payment  or  industrial  plan,  although  it  must 
be  manifest  that  the  characteristics  nnd  condition  of  the  people  who 
will  be  benefited  by  one  contract  in  no  essential  differ  from  those 
who  will  be  benefited  by  the  other,  and  the  same  is  true  when  com- 
parison is  made  with  other  benevolent  associations  authorized  by 
our  statutes.  It  follows  that  the  provision  for  exemiition  is  an 
attempt  to  make  arbitrary  elassificiition  by  selecting  a  few  of  a 
class  and  conferring  upon  them  privileges  and  benefits  not  conferred 
upon  others  coming  within  the  same  class,  and  is  therefore  invalid. 
The  vice  lying  at  the  bottom  of  the  whole  scheme  is  that  the  exemp- 
tion is  made  to  depend  not  upon  the  condition  or  characteristics  of 


794  FRATERNAL    SOCIETY    LAW 

the  recipient  of  the  benefit,  but  upon  the  source  from  which  the 
benefit  is  to  be  derived.  It  discriminates  unequally  in  favor  of  one 
set  of  beneficiaries  as  compared  with  persons  receiving  money  from 
other  sources,  thus  favoring  some  beneficiaries  as  compared  with 
other  like  beneficiaries,  and  at  the  same  time  and  by  the  same 
provision  denying  that  relief  to  some  creditors  which  by  other  en- 
actments is  accorded  to  others  of  like  kind.  *  *  *  it  follows 
inevitabley  that  the  section  under  review  not  only  discriminates 
unreasonably  between  individuals  of  the  same  class,  but  that  it  also 
unreasonably  discriminates  between  corporations  of  the  same  class. 
It  afl^ords  to  these  fraternal  orders  the  privilege  of  offering  to  the 
public  an  insurance  contract  the  proceeds  of  which,  no  matter  what 
the  amount,  are  wholly  exempt  from  the  debts  of  the  member  or 
beneficiary,  while  no  such  privilege  is  accorded  to  any  other  organ- 
ization having  authority  to  make  an  insurance  contract." 

Williams  vs.  Donough,  Feb.,  1902,  65  Ohio  St.  499. 

Beneficiary,  Dependents. 

A  society  authorized  to  issue  certificates  to  be  paid  to  members 
of  the  family  or  dependents  of  the  member,  is  not  authorized  to 
issue  a  certificate  providing  for  payment  to  one  not  dependent 
upon  the  deceased  member,  and  a  petition  in  an  action  against  a 
society  brought  to  recover  upon  a  certificate  in  which  the  plaintiff 
is  described  simply  as  a  brother  of  the  deceased  member,  and  con- 
taining no  allegation  showing  that  such  brother  was  in  any  way 
dependent  upon  the  member,  is  bad  on  demurrer  and  will  not  sup- 
port a  judgment. 

Supreme   Council,   Cath.    Benev.    Legion    vs.    McGinness,    Jan..    1899, 
59  Ohio  St.  531. 

Beneficiary,  Dependents  Right  of. 

Where  a  society  has  issued  a  certificate  to  a  member  payable  upon 
his  decease  to  his  wife,  and  afterwards,  acting  upon  a  mistaken 
belief  induee<l  by  the  representations  of  the  member  that  the  cer- 


THE    HTATE    OF    OHIO  795 

tificate  has  been  lust,  issues  ami  ddiN'crs  jiimlluT  In  lln'  nicniiicr  for 
a  liki'  aiiKiiiiit.  payalilr  hvo-tliirds  to  tlu'  wilV  and  oiit'-third  to  a 
brother  of  tlie  ineiiiber,  but  not  (le|)en(lent,  such  second  certificate 
Avill  l)e  heki  invalid  and  the  first  one  given  full  force  and  effect. 

Supreme   Council,   Cath.    Benev.    Legion    vs,    McGinness,    ,Ian.,    1899, 
59  Ohio  St.  531. 

Beneficiary,  Change  of. 

Where  a  certificate  has  been  issued  to  a  member  payable  to  his 
wife  in  accordance  with  his  application,  the  member  cannot  ehang-e 
the  beneficiary  except  in  the  mode  pointed  out  by  the  by-laws;  and 
wfiere  the  by-laws  provided  that  a  ehanore  of  beneficiary  can  be 
made  only  by  surrender  and  issue  of  a  new  certificate,  such  change 
cannot  be  made  by  will. 

Charch  vs.  Charcli,  Jan.,  1S9S,  57  Ohio  St.  561. 


796  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  OKLAHOMA 

CHAPTER  37. 

(Act  of  the  Legislative  Assembly  of  the  Territory  of  Oklahoma, 
approved  Jlarch  8,  1901.) 

Section  3236.  §  69.  A  fraternal  beneficiary  association  is  hereby 
declared  to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have  a 
lodge  system,  with  ritnalistic  form  of  work  and  representative  form 
of  government,  and  shall  make  provision  for  the  payment  of  benefits 
in  case  of  death,  and  may  make  provisions  for  the  payment  of  bene- 
fits in  case  of  sickness  temporary  or  permanent  physical  disability, 
either  as  a  result  of  disease,  accident  or  old  age,  provided  the  period 
of  life  at  which  the  payment  of  physical  disability  benefits  on  account 
of  old  age  commenced  shall  not  be  under  seventy  (70)  years.  All  sub- 
ject to  the  compliance  of  its  members  with  its  constitution  and  by- 
laws. The  fund  from  which  the  expenses  of  such  an  association  shall 
be  defrayed,  shall  be  derived  from  assessments  or  dues  collected  from 
its  members.  Payment  of  death  benefits  shall  be  to  the  families,  heirs, 
blood  relatives,  affianced  husband  or  affianced  wife  of,  or  to  persons 
dependent  upon  the  member.  Such  association  shall  be  governed  by 
this  act  and  shall  be  exempt  from  the  provisions  of  the  insurance 
laws  of  this  Territory,  except  as  provided  in  this  act,  and  no  law 
hereafter  j)assed  shall  ai)ply  t"  them  iinless  they  be  expressly  desig- 
nated therein.  Any  sucii  fraternal  beneficiary  association  may 
create,  maintain,  disburse  and  ap])ly  a  reserve  or  emergency  fund 
in  accordance  with  its  conslitution  or  liy-laws.    The  term  "fraternal 


77//-'    STATK    OF    OKLAHOMA  797 

hciiciiciary  association"  wlicrcvri'  used  in  1liis  iict,  or  in  any  other 
law  of  this  Tcrritoi'v  iicreal'tiM-  enacted,  shall  be  const imumI  to  mean 
any  association  sucli  as  is  detined  in  this  section. 

Section  '■V2'M.  S  '"'"•  All  such  associations  coniini;'  within  the  de- 
scription as  set  fortli  in  section  'M'M't,  organized  ninier  the  laws  of 
this  Territoiy,  or  the  laws  of  any  other  State,  jjruvince  or  territory, 
and  now  doing  business  within  this  Territory-,  may  continue  such 
business  provided  they  hereafter  comply  with  the  provisions  of  this 
act  regulating  annual  reports  to  the  Superintendent  of  Insurance 
and  the  designation  of  the  Superintendent  of  Insurance  as  the  person 
upon  whom  process  may  be  served  as  hereinafter  provided. 

Section  3238.  §  71.  Any  such  fraternal  beneficiary  association, 
within  the  meaning  and  description  as  set  forth  in  section  3236.  or- 
ganized under  the  laws  of  any  other  State,  Territory  or  ])rovince, 
and  not  now  doing  hnsiness  within  this  Territory  when  it  shall  be 
.shown  to  the  satisfaction  of  the  Superintendent  of  Insurance  of  this 
Tei'ritory  that  its  charter  or  articles  of  a.ssociation.  antl  its  by-laws 
provide  for  the  conduct  of  its  business  in  accordance  with  the  pro- 
visions of  this  act;  that  has  at  the  tinu'  it  apjilies  for  admission  to 
(Id  business  within  this  Territory  a  sufficient  number  of  members  so 
that  one  assessment  upon  such  members,  the  amount  of  which  assess- 
ment or  other  stated  payment  shall  not  exceed  the  amount  previously 
provided  by  the  laws  of  the  order,  shall  be  sufficient  to  ]ni>-  in  full 
the  largest  death  loss  the  association  might  be  called  upon,  under 
its  laws,  to  pay,  and  that  it  has  paid  in  full  all  just  benefit  claims 
of  whatever  nature  incurred  by  it  within  the  two  yeai's  last  past. 
Provided,  That  before  any  such  fraternal  beneficiary  association 
shall  be  authorized  to  do  business  in  this  Territory  it  shall  file  with 
the  Superintendent  of  Insurance  thereof  a  duly  certified  copy  of  its 
constitution  or  by-laws,  or  both,  if  it  has  both,  certified  to  under  oath 
by  its  secretary  or  similar  officer  and  its  chief  executive  officer, 
together  with  the  appointment  of  the  Superintendent  of  Insurance  of 
this  Territory  as  a  person  upon  whom  all  legal  process  may  be  served 
as  hereinafter  provided;  and  it  must  also  be  shown  that  the  said 
association  is  dul.v  authorized  to  do  business  in  the  State,  Territor\' 
or  province  in  which  it  is  incorporated  or  organized,  in  case  the  laws 
of  such  State,  Territory  or  province  provide  for  such  authorif.ation  ; 


798  FRATERNAL,    SOCIETY    LAW 

but  in  ease  the  laws  of  such  State,  Territory  or  province  do  not  pro- 
vide for  any  such  formal  authorization  for  such  association  to  do 
business,  then  such  association  shall  be  shown  to  be  conducting  its 
business  in  accordance  with  the  provisions  of  this  act ;  and  to  satisfy 
himelf  that  such  is  the  fact,  the  Superintendent  of  Insurance  of  this 
Territory  may  personally,  or  by  some  person  desig'uatcd  l)y  him,  ex- 
amine into  the  condition,  affairs,  character  and  business  methods, 
accounts,  liooks  and  investments  of  such  association  at  its  home  office, 
which  examination  shall  be  at  the  expen.se  of  such  association ;  but 
such  expense  shall  not  exceed  ten  dollars  ($10.00)  per  diem  in  addi- 
tion to  the  reasonable  traveling  expenses  of  the  person  making  such 
examination ;  Provided,  That  the  Superintendent  of  Insurance  may 
accept  the  examination  made  by  the  insurance  department  of  the 
State,  Territory  or  province  in  which  the  home  office  of  said  asso- 
ciation is  located,  in  his  sound  discretion.  Every  condition  of  this 
section  shall  be  considered  a  condition  precedent  for  such  an  asso- 
ciation doing  business  in  this  Territory. 

Section  3239.  §  72.  Every  such  association  doing  business  with- 
in this  Territory  shall,  on  or  before  the  first  day  of  February  of  each 
year,  make  and  file  with  the  Superintendent  of  Insurance  of  this 
Territory  a  report  and  statement  of  its  affairs,  business  and  opera- 
tions, during  the  year  ending  on  the  31st  day  of  December  im- 
mediately preceding,  together  with  a  certified  co]\v  of  its  laws,  rules 
and  regulations;  Provided,  That  no  such  association  organized  under 
the  laws  of  this  Territory  prior  to  the  passage  of  this  act  shall  be 
required  to  make  such  report  until  it  is  two  years  old.  If  such 
association  is  found,  upon  examination  of  its  report  and  laws,  to  be 
doing  business  in  accordance  with  the  provisions  of  this  act,  the 
Superintendent  of  Insurance  shall  issue  it  a  license  to  do  business 
within  this  Territory  for  one  year,  for  which  license  he  shall  charge 
and  receive  the  sum  of  five  dollars  ($5.00).  Such  annual  reports, 
which  shall  be  in  lieu  of  all  other  reports  required  by  the  Superin- 
tendent of  Insurance,  shall  be  made  on  blank  forms  furnished  by  said 
Superintendent  of  Insurance,  or  may  be  in  pamphlet  form,  and  shall 
be  verified  under  oath  b^''  the  duly  authorized  officers  of  such  asso- 
ciation. The  substance  of  this  report  shall  be  publi.shed  in  the  an- 
nvial  report  of  the  Territorial  Superintendent  of  Insurance,  in  a  part 


THE    STATE    OF    OKLAHOMA  799 

to  lie  entitled  "Prjitcriuil  Beneficiary  Associations."  and  shall  cou- 
taiii  answers  to  the  followiiiii'  questions,  and  any  other  iiil'onnation 
the  Siiper-iiitendent  of  Insurance  may  require: 

Fii'st  :  Xuinliei'  111'  (certificates  issued  during'  the  year  nr  nuiu'ier 
of  mendjers  admitted. 

Second :     Amount  of  indemnity  effected  thereby. 

Third:    Number  of  losses  or  benefit  liabilities  incurred. 

Fiiurth:     Number  of  losses  or  benefit  liabilities  paid. 

l^'il'tli:  The  amount  received  from  each  assessment  during  the 
year. 

Sixth :  Total  amount  paid  members,  beneficiaries,  legal  represen- 
tatives or  heirs. 

Seventh:  Number  and  kind  of  claims  for  -which  assessments  have 
been  made. 

Eighth :  Number  and  kind  of  claims  compromised  or  resisted,  and 
a  brief  statement  of  reasons  therefor. 

Ninth :  Does  the  association  charge  annual  or  other  periodical 
dues  or  admission  fees  ? 

Tenth :  How  much  on  each  one  thoiTsand  dollars  annually  or  per 
capita,  as  the  case  may  be? 

Eleventh :  Total  amount  received,  from  what  source,  and  the 
disposition  thereof. 

Twelfth :     Total  amount  of  salaries  paid  to  officers. 

Thirteenth :  Does  the  association  guarantee  in  its  certificate, 
fixed  amounts  to  be  jiaid.  regardless  of  the  amounts  realized  from 
assessments,  dues,  admission  fees  and  donations? 

Fourteenth:  If  so,  state  amount  guaranteed,  and  the  security  for 
such  guaranty. 

Fifteenth:     Has  the  association  a  reserve  fund? 

Sixteenth :  If  so,  how  is  it  created,  what  is  its  purpose,  its 
amount,  and  how  is  it  invested? 

Seventeenth:    Has  the  association  more  than  one  class? 

Eighteenth :  If  so,  how  many  and  the  amount  of  the  indemnity 
in  each? 

Nineteenth  :     Number  of  members  in  each  class  ? 

Twentieth:  If  it  is  a  voluntary  assoeiation.  so  state  and  give  dafp 
of  its  organization. 


800  FRATERNAL    SOCIETY    LAW 

Twenty-first :  If  organized  under  the  laws  of  this  Territory  under 
what  law  and  at  what  time,  giving  year  and  date  of  the  approval  of 
the  act. 

Twenty-second :  If  organized  under  the  laws  of  any  other  State, 
Territory  or  province,  state  such  facts  and  the  date  of  organization, 
with  complete  reference  and  designation  of  the  law  or  laws  under 
which  organized. 

Twenty-third :  Number  of  certificates  of  beneficiary  membership 
lapsed  during  the  year. 

Twenty -fourth :  Number  in  force  at  the  beginning  and  end  of  the 
year;  if  more  than  one  class,  the  number  in  each  class. 

Twenty-fifth :  Names  and  address  of  its  president,  secretary  and 
treasurer,  or  of  its  corresponding  officers. 

The  Superintendent  of  Insurance  is  authorized  and  empowered 
to  address  an.y  additional  inquiries  to  any  such  association  in  relation 
to  its  bi;siness  or  condition,  or  any  other  nwtter  connected  with  its 
transactions  relative  to  the  business  contemplated  by  this  act,  and 
such  officers  of  such  associations  as  the  Superintendent  of  Insurance 
may  require  shall  promptly  reply  in  writing,  under  oath,  to  all  such 
inquiries. 

Section  32-10.  §  73.  Every  such  association  now  doing  or  here- 
after admitted  to  do  business  within  this  Territory,  and  not  having 
its  principal  office  within  this  Territory,  and  not  being  organized 
under  the  laws  of  this  Territorv,  shall  appoint  in  writing  the  Super- 
intendent of  Insurance  and  his  successor  in  office  to  be  its  true  and 
lawful  attorney,  upon  whom  all  legal  process  in  any  action  or  proceed- 
ing against  it  must  be  served,  and  in  such  writing  shall  agree  that 
any  lawful  process  against  it  which  is  served  on  said  Superintendent 
of  Insurance  shall  be  of  the  same  legal  force  and  validity  as  if  served 
upon  said  association,  and  that  the  authority  shall  remain  in  force 
so  long  as  any  liability  against  said  association  shall  remain  out- 
standing with  this  Territory.  Copies  of  such  certificate,  certified  by 
said  Sui>erintendent  of  Insurance,  shall  be  deemed  sufficient  evidence 
thereof,  and  shall  be  admitted  in  evidence  with  the  same  force  and 
effect  as  the  original  thereof  might  be  admitted.  Service  u]ion  said 
Superintendent  of  Insurance  shall  be  deemed  sufficient  service  upon 
such  association  ;  Provided.  That  such  process  shall  not  be  returnable 


THE    STATE    OF    OKLAHOMA  801 

until  thirty  days  after  such  service.  When  h'gal  process  against 
any  such  association  is  served  upon  the  Superintendent  of  Insurance, 
he  shall  immediately  notify  the  association  of  such  service  by  regis- 
tered letter,  i)repaid,  and  directed  to  its  secretary  or  its  correspond- 
ing ofScer,  and  shall  within  two  days  after  sucii  service  forward  in  the 
same  manner  a  copy  of  the  process  served  upon  him  to  such  officer. 
The  plaintiff  in  the  action  upon  which  such  process  was  issued  shall 
pay  to  the  Superintendent  of  Insurance  at  the  time  of  such  service  a 
fee  of  three  dollars  ($3.00),  which  shall  be  recovered  by  saitl  plain- 
tiff as  a  part  of  his  taxable  costs,  if  he  prevail  in  his  said  action.  The 
Superintenclent  of  Insurance  shall  keep  a  record  of  all  processes 
served  upon  him,  which  record  shall  show  the  day  and  hour  when 
such  service  was  made,  and  when  the  notice  hereinbefore  provided 
for  was  given  to  the  officers  of  such  association.  In  all  suits  in  this 
Territory  against  any  such  association  organized  under  the  laws  of 
this  Territory,  and  having  its  principal  officer  in  this  Territory,  ser- 
vice shall  be  had  upon  the  chief  executive  officer  or  the  secretary,  or 
corresponding  officer  of  such  association. 

Section  3241.  §  74.  The  Superintendent  of  Insurance,  upon  the 
application  of  auA'  fraternal  beneficiary  association  having  the  right 
to  do  business  in  this  Territory,  as  provided  for  in  this  act,  shall 
issue,  to  such  association  a  permit  in  writing  authorizing  such  asso- 
ciation to  do  business  within  this  Territory  for  one  year  from  the 
date  thereof,  for  which  permit  or  certificate  and  all  proceedings  in 
connection  therewith  such  association  shall  pay  to  the  said  Superin- 
tendent of  Insurance  a  fee  of  five  dollars  ($;i.OO.) 

Section  3242.  §  75.  The  Superintendent  of  Insurance,  at  the  re- 
quest of  any  such  fraternal  beneficiary  association  doing  business 
under  the  provisions  of  this  act  in  this  Territory,  shall  make  an  ex- 
amination of  the  books  and  accounts  of  such  association,  and  shall 
furnish  a  certificate  of  the  results  of  such  examination,  showing  all 
such  association's  assets  and  how  invested,  the  condition  of  its  busi- 
ness, its  methods  and  such  other  particulars  as  may  be  deemed 
necessary  to  show  the  character  and  condition  of  the  financial  affairs 
of  such  association;  and  such  association,  shall  at  all  times  be  sub- 
ject to  such  examination  without  any  request  being  made  by  them. 
The  necessary  expense  of  the  examination  shall  be  paid  by  said  asso- 
51 


802  FRATERNAL    SOCIETY    LAW 

elation,  but  it  shall  not  exceed  ten  dollars  ($10.00)  per  day  and  the 
necessary  traveling  expenses  of  the  person  making  the  examination. 
Section  3243.  §  76.  Any  number  of  persons,  being  citizens  of 
the  United  States,  not  less  than  seven,  five  of  whom  shall  also  be 
citizens  and  residents  of  the  Territory  of  Oklahoma,  hereafter, de- 
sii'ing  to  form  a  fraternal  beneficiary  association,  may  associate 
themselves  together  and  eifect  such  organization  in  the  manner 
provided  in  this  section,  and  not  otherwise.  Articles  of  association 
shall  be  prepared  in  triplicate  in  the  manner  hereinafter  provided, 
and  submitted  to  the  Superintendent  of  Insurance  for  his  approval ; 
and  they  shall  not  be  approved  by  said  Superintendent  of  Insur- 
ance if  it  shall  appear  that  the  name  selected  is  the  same  or  so 
near  the  same  as  that  of  any  other  association  or  corporation  then 
doing  business  within  this  Territory  as  to  cause  confusion  in  the 
minds  of  the  people,  or  to  interfere  with  the  rights  of  such  exist- 
ing association  or  corporation,  or  that  the  objects  of  the  association 
are  not  in  accordance  with  the  provisions  of  this  Act.  or  of  any 
other  law  or  laws  of  this  Territory  applicable  to  such  associations 
or  that  the  said  articles  of  association  do  not  conform  to  the  pro- 
visions of  this  Act  in  every  particular;  but  in  case  none  of  these 
ob.jections  are  found  to  exist,  the  said  Superintendent  of  Insurance 
shall  indorse  on  the  back  of  each  copy  of  said  articles  of  association 
the  fact  that  he  has  approved  them,  together  with  the  date  of  such 
action,  all  of  which  shall  be  signed  by  him  with  his  official  title ;  Pro- 
vided, however.  That  before  the  said  Superintendent  shall  approve 
any  such  articles  of  association  it  shall  be  shown  to  him  by  the  sworn 
statement  of  one  or  more  of  the  proposed  incorporators  that  at  least 
three  hundred  persons  have  signed,  in  good  faith,  applications  for 
beneficiary  membership  in  such  proposed  association,  and  paid  to 
the  proper  one  of  such  proposed  incorporators  the  amount  of  one 
death  or  mortuary  collection,  by  whatever  name  it  may  be  called, 
and  that  such  money  is  deposited  with  some  bank  or  trust  company, 
and  is  held  for  the  special  purpose  named.  For  this  examination 
and  approval  of  the  articles  of  association  herein  mentioned,  the 
Superintendent  of  Insurance  shall  charge  and  receive  a  fee  of  five 
dollars  ($5.00).  One  copy  of  such  articles  of  association,  approved 
as  hereinbefore  provided,  shall  be  filed  with  the  Secretary  of  this 


THE    STATE    OF    OKLAHOMA  803 

Territory,  whereupon  the  said  Secretary  shall  issue  his  certificate 
of  incorporation,  and  porniaiicutly  attach  the  same  by  the  seal  of 
the  Territory  to  aiiotlier  copy  of  the  said  articles  of  association, 
approved  as  hereinbefore  provided,  which  coi)y  shall  be  delivered 
to  the  inc()ri)orators  of  such  association.  The  third  approved  copy 
of  such  articles  of  incorporation  shall  be  filed  with  the  Superintend- 
ent of  Insurance.  The  articles  of  association  hereinbefore  mentioned 
shall  be  substantially  in  the  following  form : 

First :  The  preamble  shall  name  the  incorporators  and  give  the 
residence  of  each  and  the  fact  of  their  citizenship  as  herein  required, 
and  express  their  desire  to  incorporate  a  fraternal  beneficiary  asso- 
ciation in  accordance  with  and  under  the  [irovisions  of  this  Act, 
(designating  this  Act  so  as  to  positivel.y  identify  it). 

Second:     Article  I  shall  give  the  name  of  the  association. 

Third :  Article  II  shall  state  the  location  of  the  principal  office 
of  the  association. 

Fourth :  Article  III  shall  state  the  objects  of  the  association  and 
the  plans  by  which  these  objects  are  to  be  carried  out,  including 
the  extreme  limit  of  age  of  persons  to  whom  benefit  certificates 
may  be  issued,  which  limit  of  age  shall  not  exceed  fifty-five  (55) 
years,  and  it  shall  also  state  the  fact  that  all  beneficiary  members 
will  be  required  to  pass  a  medical  examination  such  as  is  usually  re- 
quired  by  fraternal  beneficiary   associations. 

Fifth:  Article  IV  shall  state  the  names  of  the  persons  selected 
to  manage  the  business  or  prudential  affairs  of  the  association  for 
the  first  term,  for  which  such  persons  are  to  be  elected,  and  the 
manner  of  electing  their  successors,  the  title  of  all  officers  and  the 
name  of  such  officers,  with  their  residences,  if  they  have  been  se- 
lected. 

Sixth:  Article  V  shall  contain  a  description  of  the  corporate  seal 
adopted  by  such  association,  together  with  an  impress  of  the  same. 
These  articles  of  association  shall  be  signed  and  acknowledged  by 
each  of  the  incorporators. 

Section  3244.  §  77.  Any  such  fraternal  beneficiary  association 
that  is  now  doing  business  in  this  Territory  as  a  corporation  de  jure 
or  a  corporation  de  facto,  by  virtue  of  any  law  of  this  Territory 
authorizing  the   incorporation   of   such    associations,   may   re-incor- 


804  FRATERNAL    SOCIETY    LAW 

porate  under  the  provisions  of  this  Act  and  receive  from  the 
Secretary  of  the  Territory  a  cei-tificate  of  re-incorporation.  Any 
such  association  desiring  to  re-incorporate  under  this  Act,  shall,  by 
its  supreme  governing  body  or  committee  having  power  to  change 
its  laws,  adopt  a  resolution  embodying  new  articles  of  association 
prepared  to  conform  to  Section  3243,  which  resolution  must  be 
copied  in  triplicate,  signed  by  the  executive  officer  of  the  body 
adopting  it,  or  by  the  chief  executive  ofificer  of  the  association; 
and  its  correctness  and  the  fact  that  it  was  adopted  in  accordance 
with  the  provisions  of  this  section  must  be'  certified  to  under  oath 
by  the  secretarj-  or  similar  officer  of  such  association.  The  afore- 
said triplicate  copies  of  such  resolution  shall  then  be  submitted  to 
the  Superintendent  of  Insurance  for  his  approval,"  the  same  as  if 
they  were  original  articles  of  association,  as  provided  in  section 
3243,  and  one  copy  shall  be  filed  with  said  Superintendent  of  In- 
surance and  one  copy  with  the  Secretary  of  the  Territory  in  the 
manner  provided  in  Section  3243.  for  the  iiK'or])(iration  of  new  asso- 
ciations; and  when  this  is  done,  the  Secretary  shall  issue,  in  the 
manner  provided  in  Section  3243.  his  certificate  of  re-incorporation; 
and  thereafter  such  association  shall  be  deemed  to  be  re-incorporated 
under  the  provisions  of  this  Act. 

Section  3245.  §  78.  Evei-y  such  fraternal  beneficiary  association, 
from  the  time  it  files  a  copy  of  its  articles  of  association  for  record 
in  the  office  of  the  Superintendeiat  of  Insurance  and  files  a  copy  of 
said  articles  of  association  with  the  Secretary  of  the  Territory,  and 
receives  its  certificate  of  incorporation,  as  provided  either  in  section 
3243  and  section  3244,  shall  be  deemed  and  held  to  be  a  corporation 
or  body  politic  in  perpetuity  and  shall  have  and  possess  all  rights, 
powers  and  privileges  given  to  corjiorations  liy  common  law;  it 
may  sue  and  be  sued  in  any  court  of  competent  jurisdiction ;  it  may 
borrow  money  and  secure  the  payment  of  the  same  by  notes  and 
mortgages,  bonds  or  deeds  of  trust  upon  its  personal  or  real  prop- 
erty ;  it  may  rent,  lease,  purchase,  hold,  sell,  and  convey  such  real 
estate  and  personal  property  as  may  be  necessary  and  proper  for 
the  ]mrpose  of  erecting  buildings  for  the  use  of  the  association,  and 
for  other  jiroixT  ol).iects  of  sueli  association,  or  which  may  be  taken 
for  ih'bts  (liu>  to  tli(>  association:  and  i1  iiia\'  in  general  do  all  tliiiisrs 


( 


THE    STATE    OF    OKLAHOMA  805 

not.  prohibited  by  law  that  arc  necessary  and  proper  for  Ihe  ceoiiom- 
ical  and  proper  conduct  of  its  l)usiness. 

Section  3"246.  §  79.  Sueli  association  shall  not  employ  paid  agents 
in  soliciting'  or  ])roeiiriiii>'  nicnibei's,  except  in  the  organization  or 
building  up  of  subordiiuite  bodies  or  granting  members  induce- 
ments to  procure  new  members. 

Section  3247.  §  80.  No  contract  between  a  member  and  his  bene- 
ficiary that  the  beneficiary  or  other  person  for  him  shall  pay  such 
member's  assessments  and  dues  or  cither  of  them,  shall  give  the 
beneficiary  or  other  person  a  vested  right  in  the  benefit  certificate 
or  in  the  benefit  or  deprive  the  member  of  the  right  to  change  the 
name  of  the  beneficiary  or  revoke  the  certificate,  if  any,  issued  by 
such  association;  Provided,  That  such  change  or  revocation  shall  be 
made  by  written  or  printed  notice  to  the  association  in  the  manner 
and  form  provided  for  by  its  by-laws. 

Section  3248.  §  81.  The  money  or  other  benefit,  charity,  relief 
or  aid  to  be  paid,  provided  or  rendered  by  any  association  authorized 
to  do  business  under  this  Act,  shall  not  be  liable  to  attachment, 
by  trustee,  garnishee  or  other  process,  and  shall  not  be  seized,  taken, 
appropriated  or  applied  by  any  legal  or  equitable  process,  or  by 
operation  of  law,  to  ])ay  any  debt  or  liability  of  the  certificate  holder, 
or  of  any  beneficiary  named  in  any  certificate,  or  any  person  who 
may  have  any  right  thereunder. 

Section  3249.  §  82.  No  association  not  admitted  to  transact  busi- 
ness within  this  Territory  prior  to  the  passage  of  this  Act  shall  be 
incoriiorated  or  given  a  permit  or  certificate  of  authority  to  trans- 
act business  within  this  Territory,  as  provided  for  by  this  Act, 
unless  it  shall  first  show  that  the  mortuary  assessment  rates,  pro- 
vided for  in  whatever  plan  of  business  it  has  adopted,  are  not  lower 
than  is  indicated  as  necessary  by  the  following  mortality  table : 

FRATERNAL  C0NC4RESS  MORTALITY  TABLE. 


Age. 

No.  Living. 

No. 

Dying. 

Probability  o 

20 

100,000 

500 

.005000 

21 

99.500 

501 

.005035 

22 

98,999 

502 

.005071 

23 

98,497 

503 

.005107 

806 


FRATERNAL    SOCIETY    LAW 


Age; 

No.  Liviug. 

No.  D.viiig. 

Probability  of  Dying 

24 

97.994 

505 

.005153 

25 

97,489 

507 

.005201 

26 

96,982 

510 

.005259 

27 

96,472 

513 

.005318 

28 

95,959 

517 

.005388 

29 

95,442 

522 

.005469 

30 

94,920 

527 

.005647 

31 

94.393 

533 

.005647 

32 

93,860 

540 

.005753 

33 

93,320 

548 

.005872 

3i 

92.772 

557 

.006004 

35 

92,215 

567 

.006149 

36 

91.648 

578 

.006307 

37 

91,070 

591 

.006490 

38 

90.479 

606 

.006698 

39 

89,873 

622 

.006921 

40 

89,251 

640 

.007171 

41 

88.611 

660 

.007448 

42 

87.951 

683 

.007766 

43 

87.268 

708 

.008113 

44 

86.560 

734 

.008480 

45 

85.826 

761 

,008867 

46 

85.065 

790 

.009287 

47 

84.275 

822 

.009754 

48 

83,453 

857 

.010269 

49 

82.596 

894 

.0108238 

50 

81,702 

935 

.0114440 

51 

80.767 

980 

.0121337 

52 

79,786 

029 

.0128970 

53 

78,757 

1,083 

.0137511 

54 

77.674 

1,140 

.0146767 

55 

76.534 

1,202 

.0157054 

56 

75.332 

1,27(1 

.0168587 

57 

74,062  ' 

1,342 

.0181200 

58 

72,720 

1,418 

.0194994 

59 

71,302 

1,501 

.0210513 

THE    STATE    OF    OKLAHOMA  807 


Age. 

No.  Living. 

No.  Dying'.  I 

'robability  oi 

60 

,  69,801 

1,588 

.0227504 

61 

68,213 

1,681 

.0246434 

62 

66,532 

1,778 

.0267240 

63 

64,754 

1,880 

.0290330 

64 

62,874 

1,985 

.0315711 

65 

60,889 

2,094 

.0343904 

66 

58,795 

2,206 

.0375206 

67 

56,589 

2,318 

.0409620 

68 

54,271 

2,430 

.0447753 

69 

51,841 

2,539 

.0489767 

70 

49,302 

2,645 

.0536489 

71 

46.657 

2,744 

.0588122 

72 

43,913 

2,832 

.0644912 

73 

41,081 

2,909 

.0708113 

74 

38,172 

2,969 

.0777795 

75 

35,203 

3,009 

.0854757 

76 

32,194 

3,026 

.0939927 

77 

29,168 

3,016 

.1034010 

78 

26,152 

2,977 

.1138345 

79 

23,175 

2,905 

.1253506 

80 

20,270 

2,799 

.1385163 

81 

17,471 

2,659 

.1521951 

82 

14.812 

2,485 

.1677694 

83 

12,327 

2,280 

.1849599 

84 

10.047 

2,050 

.1855707 

85 

7,997 

1,800 

.2250844 

86 

.   6,197 

1.539 

.2483460 

87 

4,658 

1,277 

.2741520 

88 

■  3,381 

1,023 

.3025732 

89 

2,358 

788 

33.41815 

90 

1,570 

579 

.3687898 

91 

991 

404 

.4076690 

92 

587 

264 

.4497445 

93 

323 

161 

;4984520 

94 

162 

89 

.5493827 

95 

73 

44 

.6027397 

Ao-e. 

No. 

Living 

96 

29 

97 

10 

98 

■     33 

808  FRATERNAL    SOCIETY    LAW 

No.  Dying.  Probability  of  Dying. 
19  .6551724 

7  .7000000 

3  .10000000 

Section  3250.  §  S3.  Any  such  fraternal  beneficiary  association 
organized  under  the  laws  of  this  Territoi-y  may  provide  for  the 
meeting  of  its  legislative  or  governing,  body  in  any  other  State, 
Territory  or  Province,  wherein  such  association  shall  have  subordi- 
nate lodges  or  bodies,  and  all  business  or  corporate  acts  transacted  at 
such  meetings  shall  he  valid  in  all  respects  as  if  such  meetings  were 
held  in  this  Territory ;  and  where  the  laws  of  any  such  association 
provide  for  the  election  of  its  officers  by  votes  cast  in  its  subordinate 
bodies,  the  votes  so  east  by  its  subordinate  bodies  in  any  other  State, 
Territory  or  Province  shall  be  as  valid  as  if  cast  in  this  Tei'ritory. 

Section  3251.  §  84.  Any  person,  officer,  member  or  examining 
physician  who  shall  knowingly  or  wilfully  make  any  false  or  fraudu- 
lent statement  or  representation  in  or  with  reference  to  any  applica- 
tion for  membership  or  for  the  purpose  of  obtaining  any  money  or 
benefit  in  any  association  transacting  business  under  this  Act,  shall 
be  guilty  of  a  misdemeanor,  and  upon  conviction  shall  be  punished 
by  a  fine  of  not  less  than  one  hundred  dollars  ($100.00),  nor  more 
than  five  hundred  dollars  ($500.00),  or  imprisonment  in  the  county 
jail  for  not  less  than  thirty  days  nor  more  than  one  year,  or  both 
such  holder,  and  any  person  who  shall  wilfully  make  any  false 
person  who  shall  wilfully  make  any  false  statement  of  any  material 
fact  or  thing  in  a  sworn  statement  as  to  the  death  or  disability 
of  a  certificate  holder  or  member  in  any  association  for  the  pur- 
pose of  procuring  payment  of  a  benefit  named  in  the  certificate  of 
such  holder,  and  any  person  who  shall  wilfully  make  any  false 
statement  in  any  verified  report  or  declaration  under  oath,  required 
or  authorized  by  this  Act,  shall  be  guilty  of  perjury,  and  shall  be 
proceeded  against  and  punished  as  provided  by  the  Statutes  of 
this  Territory  in  relation  to  the  crime  of  perjury. 

Section  3252.  §  85.  Any  such  association,  whether  organized 
under  the  laws  of  this  Territory  or  of  any  other  State,  Territory 
or  Province,  refusing  or  neglecting  to  make  the  report  as  provided 


THE    STATE    OF    OKLAHOMA  809 

ill  this  Act  shall  bu  excluded  from  doing  business  within  this  Terri- 
tory. The  Superintendent  of  Insurance,  witliin  sinxty  days  after 
any  such  association's  failure  to  make  such  report,  or  in  case  any 
8uch  association  shall  exceed  its  powers,  or  shall  conduct  its  business 
fraudulently,  or  shall  fail  to  comply  with  any  of  the  provisions 
of  this  Act,  must  give  notice  in  writing  to  the  Attorney  General, 
who  shall  immediately  commence  an  action  against  any  such  asso- 
ciation to  enjoin  it  from  carrying  on  any  business  within  this  Terri- 
tory. No  injunction  against  any  such  association  shall  be  granted 
by  any  court  to  enjoin  it  from  transacting  business  in  this  Terri- 
tory, except  on  application  of  the  Attorney  General  thereof,  at  the 
request  of  the  Superintendent  of  Insurance,  whether  the  Territory 
or  a  member  of  other  party  seeks  relief.  No  association  so  enjoined 
shall  have  power  or  authority  to  continue  in  business  until  such 
report  shall  be  made,  or  overt  acts  or  violation  of  the  law  com- 
plained of  shall  be  corrected,  nor  until  the  costs  of  such  action  be 
paid  by  it,  provided  the  court  shall  find  that  such  association  was 
in  default  as  charged ;  whereupon  the  Superintendent  of  Insurance 
shall  re-instate  such  association,  and  not  until  that  is  done  by  him 
shall  such  association  be  again  allowed  to  do  business  within  this 
Territory.  Any  officer,  agent  or  person  acting  for  such  association, 
or  subordinate  body  thereof,  within  this  Territory,  while  such  asso- 
ciation shall  be  so  enjoined  or  prohibited  from  doing  business  pur- 
suant to  this  Act,  shall  be  deemed  guilty  of  a  misdemeanor,  and, 
on  conviction  thereof,  shall  be  punished  by  a  fine  of  not  less  than 
twenty-five  dollars  ($25.00),  nor  more  than  two  hundred  dollars 
($200.00),  or  by  imprisonment  in  the  county  jail  for  not  less  than 
thirty  days,  nor  more  than  one  year,  or  by  both  such  fine  and 
imprisonment  in  the  discretion  of  the  court. 

Section  3253.  §  86.  Any  person  who  shall  act  within  this  Terri- 
tory, as  an  oflScer,  agent,  or  otherwise,  for  any  association,  which 
shall  have  failed,  neglected,  or  refused  to  comply  with  or  shall 
have  violated  any  of  the  provisions  of  this  Act,  or  shall  have  failed 
or  neglected  to  procure  from  the  Superintendent  of  Insurance  a 
proper  certificate  of  authority  to  transact  business  within  this  Terri- 
tory, as  ju'ovided  for  by  this  Act,  shall  be  subject  to  the  penalties 


81 0  FRATERNAL    SOCIETY    LAW 

provided  iu  the  last  preceding  section  for  the  misdemeanor  therein 
defined  and  specified. 

Section  3254.  §  87.  "When  any  other  State,  Territory,  or  Prov- 
ince shall  impose  any  obligation  upon  any  fraternal  beneficiary  as- 
sociation organized  under  the  laws  of  tthis  Territory,  or  upon  its 
agents  or  representatives,  or  other  persons  transacting  business  for 
it  in  such  other  State,  Territory  or  Province,  the  like  obligations 
are  hereby  imposed  on  similar  fraternal  beneficiary  associations  or- 
ganized under  the  laws  of  such  other  State,  Territory  or  Province, 
and  their  agents  or  representatives  doing  business  in  this  Territory. 

Section  3255.  §  88.  This  Act  shall  not  apply  to  any  corporation, 
society  or  association  carrying  on  the  business  of  life,  health,  casualty 
or  accident  insurance  for  profit  or  gain,  but  it  shall  apply  only 
to  fraternal  beneficiary  associations  as  defined  in  Section  3236. 
This  Act  shall  not  efl'ect  or  apply  to  any  grand  or  subordinate  lodge 
of  the  Ancient  Order  of  Free  and  Accepted  Masons,  Independent 
Order  of  Odd  Fellows,  Improved  Order  of  Red  Men,  or  Knights  of 
Pythias  as  they  now  exist,  nor  to  similar  orders,  or  secret  societies, 
nor  to  any  association  not  Avorking  on  the  lodge  system,  or  which 
limits  its  certificate  holders  to  a  particular  class,  or  to  the  employees 
of  a  particular  town,  or  citj',  designated  firm,  business  house  or 
corporation. 

Knowledge  of  Laws  Presumed. 

A  member  is  presumed  to  know  the  laws  of  the  society,  and  he  is 
bound  thereby. 

Home  Forum  Benefit  Order  vs.  Jones,  June,  1S97,  5  Okla,  598. 

Agency  of  Subordinate  Lodges. 

Subordinate  lodges  may  have  a  very  limited  or  a  very  wide 
authority.  If  they  have  blank  certificates  which  they  can  issue  to 
whom  they  please,  they  can  bind  their  superiors  to  almost  anything 
they  do  in  the  line  of  issuing  them.  Generally,  however,  the  sub- 
ordinate lodges  are  like  agents  of  life  insurance  companies  in  that 
they  can  only  solicit  applications  which  are  referred  to  the  supreme 
body  to  be  accepted  or  decliiu'd  as  its  officers  may  elect.     The  sub- 


TEE    STATIC    OF    OKLAHOMA  gH 

ordinate  lodges  are  tied  down   by  instructions  which   they  ennnot 
violate  even  if  they  were  so  inclined. 

Home  Forurn  Benefit  Order  vs.  Jones,  June,  1S97,  5  Okia,  598. 

Contracts  Not  Made  by  Reason  of  Delays. 

The  delay  of  a  subordinate  lodge  in  forwarding  applications  for 
membership  and  for  benefit  certificate  does  not  create  a  contract 
in  the  face  of  the  provisions  of  the  laws  of  the  society  that  the  offi- 
cers of  the  Supreme  Lodge  alone  have  power  to  pass  \\\Hm  applica- 
tions and  to  issue  certificates. 

Home  Forum  Benefit  Order  vs.  Jones,  June,  1897,  5  Okla,  598. 

Evidence,  Parol  Not  Allowed  to  Vary  Contract. 

Where  the  terms  of  a  written  contract  are  clear,  plain  and  explicit, 
and  free  from  all  ambisnity.  i)arol  testimony  is  not  admissible  to 
change  or  vary  its  terms. 

Liverpool,  London  &  Globe   Ins.   Co.  vs.  Rkliardson,   Feb.,   1902,   11 
Okla.  579. 

Knowledge  of  Terms  of  Contract  Presumed. 

An  applicant  for  insurance  who  accepts  a  policy,  the  provisions 
of  which  are  plain,  clear,  and  free  from  ambiguity,  is  chargeable 
with  knowledge  of  its  terms  and  legal  effect.  It  is  his  duty  to  read 
and  know  the  contents  of  the  contract  before  he  accepts  it,  and 
where  he  fails  or  neglects  to  do  so,  he  is  estopped  from  denying 
knowledge  of  its  terms  and  conditions,  unless  he  alleges  and  proves 
that  he  was  induced  not  to  read  the  policy  by  some  trick  or  fraud 
of  the  other  party. 

Liverpool,   London  &  Globe   Ins.   Co.   vs.   Richardson,   Feb.,   1902,   11 
Okla.   579. 

Warranty  of  Literal  Truth  of  Application  Reasonable. 

Where  an   ajiplication  for  insurance  is  made  for  the  purpose  of 


812  FRATERNAL    SOCIETY    LAW 

informiug  a  company  of  the  facts  with  reference  to  the  risks  pro- 
posed, and  to  furnish  it  information  upon  which  it  is  to  act  in  ac- 
cepting or  refusing  the  risk,  and  wherein  the  applicant  warrants  his 
answers  to  be  true,  a  stipulation  in  the  application  and  policy  that 
if  any  of  the  statements  made  in  the  application  by  the  applicant  is 
untrue,  the  policy  shall  be  void,  is  a  reasonable  stipulation. 

Deming  Investment  Co.  vs.  Shawnee  Ins.  Co.,  Sept.,  1905,  16  Okla.  1. 

Agency,  Principal  Not  Bound  by  Unauthorized  Acts, 

Where  a  waiver  of  the  stipulation  and  conditions  contained  in  a 
policy  relied  upon  is  the  act  and  conduct  of  an  agent  of  the  insur- 
ance company,  it  must  be  shown  that  the  agent  had  express  au- 
thority from  the  company  to  make  the  waiver,  or  that  the  company 
subsequently,  with  knowledge  of  the  facts,  ratified  the  unauthorized 
action  of  the  agent ;  and  an  agent  whose  powers  are  strictly  defined 
and  limited  by  the  express  term.s  of  the  contract  of  insurance  cannot 
act  so  as  to  bind  his  company  beyond  the  scope  of  his  authority. 

Deming  Investment  Co.  vs.  Shawnee  Ins.  Co.,  Sept.,  1905,  16  Okla.  1, 

Warranty,  Immateriality  of  Representations. 

Where  by  the  express  terms  of  an  application  and  by  the  terms  of 
the  contract  the  application  is  made  part  of  the  contract,  and  the 
representations  contained  in  the  application  made  by  the  applicant 
are  warranted  to  be  true,  and  it  is  stipulated  that  the  policy  shall 
be  void  if  any  of  such  representations  are  not  true,  the  question  of 
the  materiality  of  such  rein-esentations  becomes  unimportant;  for 
under  such  stipulations  in  a  suit  to  recover  under  the  contract  the 
insurance  company  is  relieved  from  showing,  and  the  insured  is 
estopped  from  denying,  that  they  were  material  to  the  contract. 

Deming  Investment  Co.  vs.  Shawnee  Ins.  Co..  Sept.,  1905.  16  Okla.  1, 


THE  STATE   OF  OREGON  813 


THE 

STATE  OF  OREGON. 

CHAPTER  38. 

There  is  no  code  for  the  regulation  of  fraternal  societies  in  the 
State  of  Oregon  and  by  Sections  3723,  3724,  3748  and  3749  of  the 
statutes  of  the  State  they  are  exempted  from  the  operation  of  the 
general  insurance  laws  of  the  State.  The  sections  in  question  are 
as  follows: 

Licenses  to  Companies  and  Terms  of. 

§  3723.  This  act  shall  take  effect  on  the  first  day  of  July,  1887, 
and  all  licenses  issued  by  the  commissioner  shall  expire  on  the  thirty- 
first  day  of  December  of  each  year,  and  shall  be  issued  pro  rata  for 
any  period  less  than  one  year.  Within  thirty  days  after  the  first  day 
of  July,  1887,  and  within  thirty  days  after  the  first  day  of  January, 
1888,  and  annually  thereafter,  each  company  doing  or  proposing  to 
do  an  insurance  business  in  this  State  shall  apply  to  the  commis- 
sioner for  a  license,  and  if  he  shall  be  satisfied  that  such  company 
is  qualified  to  do  business  under  the  provisions  of  this  act,  he  shall 
issue  the  same,  on  the  receipt  in  gold  coin  of  the  amount  required 
herein,  and  the  admission  of  an  insurance  company  to  do  business 
in  this  State  shall  not  be  denied  by  the  commissioner  when  it  makes 
and  tenders  a  full  compliance  with  the  provisions  of  this  act.  fL. 
1887,  p.  123,  §  17;  H.  C.  §  3579.] 

License  Fees,  Fines,  and  Taxes,  and  their  Disposal. 

§  3724.     The  commissioner  shall  collect  for  filiiis'  each  power  of  at- 


814  FRATERNAL    SOCIETY    LAW 

torney,  os  issuing  his  certificate  as  required  by  law,  $5  ;  for  an  annual 
license  of  each  lire  insurance  company  to  transact  business  through- 
out this  State,  $50;  for  any  annual  license  to  each  life  insurance  com- 
pany, co-operative  insurance  association,  or  mutual  benefit  society  to 
transact  business  throughout  this  State,  $100 ;  for  an  annual  license 
to  each  life  and  accident  or  an  accident  insurance  company  to  trans- 
act business  throughout  this  State,  $100 :  Provided,  That  all  orders  or 
secret  societies,  such  as  Masons,  Odd  Fellows,  Druids,  Knights  of 
Pythias,  Ancient  Order  of  United  Workmen,  Grangers,  Firemen, 
and  other  benevolent,  fraternal,  co-operative  societies  associated  or 
incorporated  for  the  sole  purpose  of  mutual  protection  and  relief  of 
its  members  only,  and  for  the  payment  of  stipulated  sums  of  money 
to  the  families  of  deceased  members,  or  for  property  of  its  mem- 
bers only,  destroyed  by  fire,  and  not  for  profit,  are  hereby  declared 
not  to  be  fire  or  life  insurance  companies  in  the  sense  and  meaning 
of  the  insurance  laws  of  this  State,  and  they  are  exempt  from  the 
provisions  of  all  insurance  laws  of  this  State.  For  examining  the 
financial  condition  of  any  company  or  association  organized  in  this 
State,  the  just  and  legitimate  expense  of  such  examination  shall  be 
paid  by  the  said  company,  and  the  commissioner  shall  revoke  in- 
refuse  his  certificate  of  authority  to  any  company  neglecting  or 
refusing  to  pay  such  expense  or  to  furnish  any  information  to  said 
■commissioner  authorized  by  this  act.  All  fines  and  penalties  re- 
ceived and  taxes  jiaid  on  premiums  under  the  provisions  of  this  act 
shall  be  paid  into  the  State  school  funds,  and  sixty  per  cent  of  ;ill 
licenses  collected  by  the  commissioner  shall  be  paid  into  the  general 
fund  of  the  State,  and  the  commissioner  shall  be  entitled  to  receive 
the  fees  and  forty  per  cent  of  the  licenses  prescribed  by  law,  as 
compensation  for  his  services.  Every  foreign  fire,  fire  and  marine, 
life,  life  and  accident,  plate  glass  and  steam  boiler  insurance  com- 
pany now  doing  business  in  this  State,  or  that  nuiy  hereafter  do 
business  in  this  State,  shall,  witliin  sixty  (GO)  days  after  the  passage 
of  this  act,  and  on  or  before  renewal  or  issuing  of  a  license,  appoint 
a  resident  general  agent  on  whom  legal  service,  if  any  necessary, 
may  be  made,  and  to  whom  all  other  agents  of  the  company  in  the 
State  shall  make  rej)ort,  not  less  frequently  than  once  a  week,  of 
business  transacted  ;   und    said   officer   shall,    on    oi-  before   the   first 


THh:    UTATE    OF    OREGON  815 

day  of  March  of  each  year,  furnish  the  Insurance  Commissioner  of 
this  State  a  sworn  statement  of  the  total  business  transacted  by  such 
company  \tithin  the  State  of  Oregon  during  the  year  ending  De- 
cember 31st  prior  thereto.  Such  statement  shall  show  the  total  gross 
premiums  received  during  the  year,  from  which  shall  be  deducted 
returned  premiums  and  losses  jiaid  in  the  State,  and  every  such 
fire,  fire  and  marine,  life,  life  and  accident,  plate  glass  and  steam 
boiler  insurance  com])any  shall,  within  thirt.y  days  from  the  date  of 
such  annual  statement,  pay  to  the  Insurance  Commissioner  a  fee  of 
$5  for  filing  such  statement.  The  Insurance  Commissioner  shall  file 
such  verified  statement  and  schedule  in  his  office,  and  shall  certify 
the  amount  of  such  gross  premiums  received,  less  premiums  re- 
turned and  losses  paid  in  the  State,  to  the  State  Treasurer.  Within 
ten  days  thereafter  such  foreign  insurance  company  shall  pay  or 
cause  to  be  paid  into  the  State  treasury  a  tax  of  two  per  cent  upon 
all  such  gross  receipts,  less  premiums  returned  and  amount  of  losses 
paid,  which  payment,  when  so  made,  shall  be  in  lieu  of  all  taxes 
upon  the  personal  property  of  such  company  and  the  shares  of  .stock 
therein.  Any  insurance  company  failing  or  refusing  to  render  such 
statement  and  to  pay  the  required  two  per  cent  tax  thereon  for 
more  than  thirty  days  after  the  time  so  specified,  shall  be  liable  to 
a  fine  of  $100  for  each  additional  day  such  statement  and  payment 
is  delayed,  and  to  have  its  license  revoked;  and  the  said  taxes  may 
be  collected  by  distraint  and  fine  recovered  by  an  action  to  be  in- 
stituted by  the  prosecuting  attorney,  in  the  name  of  the  State,  in 
the  county  where  the  principal  office  of  such  insurance  company  is 
located;  and  such  company  may  be  enjoined  from  doing  business  in 
this  State  until  payment  of  such  taxes  and  fine,  should  any  be  im- 
posed, is  fully  made,  and  notice  thereof  be  given  to  the  Insurance 
Commissioner.  Upon  payment  of  such  taxes  and  fines  or  other 
moneys  to  the  State  Treasurer,  and  the  giving  of  notice  to  the  In- 
surance Commissioner  as  prescribed,  and  on  full  compliance  in  all 
other  respects  with  the  laws  of  Oregon,  such  company  may  be  per- 
mitted by  the  Insurance  Commissioner  to  resume  business:  Pro- 
vided, That  all  real  ]iroperty,  if  any,  of  such  company  shall  be  listed, 
assessed,  and  taxed  the  same  as  real  property  of  like  character  of 


816  FRATERXAL    SOCIETY    LAW 

individuals.     [L.  1887,  p.  123,  §  18 ;  L.  1889,  p.  66,  §  3;  H.  C.  §  3580; 
L.  1895,  p.  83,  §  1.] 

Lodge  Systems  with  Ritualistic  Work  not  Within  Law. 

§  3748.  Nothing  in  this  act  shall  be  construed  to  apply  to  organ- 
izations operating  or  working  under  the  lodge  system  and  having 
ritualistic  Avork  in  their  lodges.     [L.  1899,  p.  80,  §  10.] 

An  Act  to  License  and  Regulate  Life  and  Casualty  Insurance  Com- 
panies and  Societies. 

(Filed  in  the  office  of  the  Secretary  of  State  February  21,  1891.) 
Fraternal  Societies  May  Grant  Relief. 

§  3749.  Those  certain  fraternal  orders  or  societies,  commonly 
designated  as  Masons,  Odd  Fellows,  Druids,  Knights  of  Pythias, 
Ancient  Order  of  United  Workmen,  Patrons  of  Husbandry,  Knights 
of  Labor,  and  a  certain  association  organized  in  the  State  of  Oregon 
in  the  year  1883,  designated  as  the  "Washington  Co-operative 
Life  Insurance  Association,"  and  also  all  fraternal  orders  or 
societies  that  are  associated  or  incorporated  for  the  primary 
purpose  of  mutual  protection  and  relief  of  members  other 
than  such  protection  and  relief  as  may  be  afforded  by  in- 
surance, and  having  ritualistic  work  and  ceremonies  under  the 
provision  of  a  grand  or  supreme  body,  may  grant  relief  to  sick 
members  and  pay  money  to  the  families  of  deceased  members  without 
complying  with  the  laws  of  this  State  respecting  insurance  corpora- 
tions or  associations ;  provided,  however,  that  the  Insurance  Com- 
missioner of  this  State  shall  have  power  to  decide  whether  any 
society,  order,  or  association  other  than  the  several  orders  and  asso- 
ciations above  specifically  named  is  a  fraternal  society  associated 
for  the  primary  purpose  of  the  protection  or  relief  of  members,  other 
than  such  protection  or  relief  as  is  afforded  by  insurance,  and  his 
decision  as  to  the  right  of  any  such  society,  order,  or  association 
to  claim  the  benefit  of  the  above  exemption  shall  be  final.  [L.  1891, 
p.  167,  §1;  L.  1893.  p.  98,  §1-1 


THE    STATE    OF    OREGON  817 

Proofs  of  Death,  False  Statements. 

An  intentionally  false  statement  by  the  insured  touching  a  ma- 
terial fact  or  matter  or  legitimate  inquiry  under  the  contract,  as  for 
example  a  false  statement  as  to  the  articles  claimed  to  have  been 
lost  and  their  value,  made  for  the  purpose  of  defrauding  and  deceiv- 
ing the  company,  renders  the  policy  void,  although  the  company 
has  not  been  actually  deceived  or  misled  to  its  detriment. 

Fowler  vs.  Phoenix  Ins.  Co.,  Jan.,  1899,  35  Ore.  559;  57  Pac.  421. 
Beneficiary — Change  of. 

A  member  desiring  to  change  the  beneficiary  named  in  the  cer- 
tificate must  substantially  comply  with  the  rules  of  the  society  regu- 
lating that  subject,  or  the  change  will  not  become  effective.  Thus, 
where  the  laws  required  a  member  who  wished  to  change  beneficiary 
to  file  a  written  petition  with  his  local  lodge  stating  certain  facts 
relating  to  the  matter  and  directing  that  the  secretary  .should  send 
the  certificate  and  petition  to  the  Grand  Secretary,  an  alteration  by 
the  local  secretary  of  the  name  of  the  beneficiary  is  ineffectual  for 
any  purpose  and  cannot  be  regarded  as  a  change  of  beneficiary. 

Independent  Foresters  vs.  Keliher,  Dec,  1899,  36  Ore.  501;    59  Pac. 
324-1109;   60  Pac.  56S. 

Beneficiary — Changes  of  Must  be  in  Conformity  With  Law. 

The  failure  of  a  Grand  Secretary  to  suppl.y  local  secretaries  with 
blanks  for  the  changing  of  beneficiaries,  or  the  fact  that  the  local 
lodge  failed  to  meet  on  a  regular  day  when  an  application  for  change 
of  beneficiary  might  have  been  considered,  does  not  constitute  a 
waiver  of  the  requirement  of  the  society  as  to  making  changes  of 
beneficiaries. 

Independent  Foresters  vs.  Keliher,  Dec,  1899,  36  Ore,  501;    59  Pac. 
324-1109;  60  Pac  563. 

Foreign  Society — Service  of  Process  Upon  Local  Agent  of. 

Under  the  statutes  of  the  State  providing  for  service  of  process,  the 
52 


818  FRATERNAL    SOCIETY    LAW 

service  of  process  on  a  nou-resident  fraternal  benefit  society  may  be 
made  hy  delivering  the  process  to  one  who  as  secretary  of  the  local 
lodge  of  the  society  is  required  to  receive  assessments  from  members 
and  remit  them  to  the  head  office,  and  to  keep  and  report  the  record 
of  the  standing  local  members,  to  notify  the  head  office  of  the  death 
of  members,  and  to  return  the  complete  proofs  of  death — such  a 
person  being  held  to  be  an  agent  of  the  society  for  the  purposes  of 
service  of  process  upon  the  society. 

Hildebrand  vs.  United  Artisans,  Jan.,  1905,  46  Ore.  134;  79  Pac.  347. 

Venue  of  Suit  Against  Society. 

Under  a  statute  providing  that  a  corporation  may  be  sued  in  the 
county  where  the  cause  of  action  arose,  an  insurance  society  may  be 
sued  on  its  contract  in  the  county  whereof  its  beneficiary  was  an 
inhabitant  at  the  time  of  the  member's  death. 

Hildebrand  vs.  United  Artisans,  Jan.,  1905,  46  Ore.  134;  79  Pac.  347. 

Proofs  of  Death — to  be  Furnished  Before  Suit. 

Xou-compliance  with  the  provisions  of  a  contract  requiring  the 
beneficiary  to  furnish  proofs  witliin  one  year  after  the  death  of  the 
insured,  to  which  no  penalty  is  subjoined  for  non-observance,  does 
not  forfeit  the  policy,  but  requires  the  funiishing  of  proof  prior  to 

the  bringing  of  an  action. 

Stincluomb  vs.  N.  Y.  life  Ins.  Co.,  April.  1905,  46  Ore.  316;   80  Pac. 
213. 

Suspension,  Payment  of  Arrearages  and  Death  of  Member  While 
Under. 

An  assessment  on  a  certificate  was  remitted  while  the  member  was 
suspended  and  received  at  the  head  office  after  his  death,  the  head 
officer  not  being  aware  of  the  member's  illness  or  death,  held,  that 
the  societv  cannot  be  said  to  have  waived  the  suspension  by  keeping 
the  assessment  for  a  few  weeks. 


THE    STATU    OF   OREGON  819 

Miller  vs.  Head  Camp,  Woodmen  of  the  World,  .June,  1904,  45  Ore. 
192;   77  Pac.  83. 

Beneficiary — Rights  Under  Interpleader  Suit. 

The  lack  of  actual  substitution  as  beneficiary  in  a  certificate  pur- 
suant to  the  laws  of  the  society  does  not  affect  an  agreement  by 
which  a  jjerson  not  named  therein  is  to  receive  the  insurance  and 
so  deprive  him  of  his  equity  to  claim  the  same  as  against  the  bene- 
ficiaries named  therein,  where  the  society  does  not  insist  on  it,  and 
pays  the  fund  into  court  to  be  awarded  to  the  contestant  entitled 
thereto. 

Brett  vs.  Warnick,  March,  1904,  44  Ore.  511;  75  Pac.  1061. 

Assignment  of  Equitable  Interest  by  Member. 

A  member  of  a  society  hiiviiit;-  the  consent  of  the  beneficiary  named 
in  the  certificate,  who  lias  a  vested  interest  therein  by  having  made 
payments  necessary  to  its  continuance,  may  contract  witli  a  third 
jjerson  so  as  to  transfer  thereby  an  interest  in  tlie  proceeds  of  such 
certificate,  unless  the  contract  is  contrary  to  public  policy  or  other- 
wise unlawful. 

Brett  vs.  Warnick,  March.  1904.  44  Ore.  511;   75  Pac.  lOfil. 

Beneficiary — Change  of  Must  be  in  Strict  Conformity  with  the  Laws. 

A  member  cannot  change  the  beneficiary  in  his  certificate  except 
by  complying  with  the  laws  of  the  society.  Thus  where  a  member 
had  a  certificate  pa.valile  to  liis  mother,  and  the  laws  provided  that 
the  member  could  change  the  beneficiary  at  any  time  in  a  prescribed 
manner  and  on  payment  of  a  certain  fee.  but  that  no  change  should 
be  effective  until  the  old  certificate  slionld  have  lieen  delivered  to 
the  society  and  a  new  certificate  issued  during  the  lifetime  of  the 
member,  until  which  time  the  old  certificate  should  remain  in  force, 
the  member  took  all  tlie  prescribed  steps  to  substitute  his  wife  as 
beneficiary  except  the  payment  of  the  fee.  Tlie  change  was  not 
accomplished  and  the  insurance  belonged  to  the  original  beneficiary. 

Strlngham  vs.  Dillon.  Aug.,  1902,  42  Ore.  (53;  G9  Pac.  1020. 


820  FRATERNAL    SOCIETY    LAW 

Evidence — Coroner 's  Verdict  not  Receivable  in. 

The  record  of  a  coroner's  inquest  is  not  competent  evidence  be- 
tween private  parties  as  to  the  cause  of  the  death  of  the  deceased, 
for  under  the  constitution  and  laws  of  Oregon  a  coroner  is  not  a 
judicial  officer,  nor  has  his  record  any  judicial  impress. 

Cox  vs.  Royal  Tribe,  Jan.,  1903,  42  Ore.  365;   71  Pac.  73. 

Proofs  of  Death  Furnished  by  Agent  of  Society. 

Proofs  of  death  furnished  by  an  agent  of  the  society  are  not  com- 
petent evidence  as  to  the  cause  of  death  in  an  action  by  the  bene- 
ficiary against  the  society,  unless  sanctioned  by  the  beneficiary. 

Cox  vs.  Royal  Tribe.  Jan.,  1903.  42  Ore.  365;   71  Pac.  73. 

Suicide — Presumptions  Against. 

Where  the  dead  body  of  the  member  was  found  in  the  water,  but 
no  one  saw  her  go  in,  and  it  did  not  appear  from  the  other  evidence 
whether  she  went  in  of  her  own  accord  or  otherwise,  the  court  was 
warranted,  in  an  action  over  her  benefit  certificate,  in  charging  that 
thei'e  was  a  presumption  of  natural  death  as  against  the  claim  of 
suicide. 

Cox  vs.  Royal  Tribe,  Jan..  1903.  42  Ore.  365;   71  Pac.  73. 

Forfeiture — When  Lodge  Required  to  Make  Payments  to  Prevent. 

For  the  facts  in  a  case  where  it  was  claimed  that  the  member  had 
forfeited  the  certificate  by  non-payment  of  assessments,  and  where 
it  was  the  duty  of  the  lodge  to  which  the  member  belonged  to  pay 
the  member's  assessments  under  certain  contingencies.     See: 

Montour  vs.  Grand  Lodge,  Oct..  1900,  38  Ore.  47:   62  Pac.  524. 

Suspension — Failure  to  Appeal  Bound  by  Action  of. 

Under  a  coiistitulional    jirovision    of  a    society  providing  that  a 


THE    STATE    OF   OREGON  821 

member  who  has  bee;i  suspended  or  expelled  must  apply  for  re- 
instatement within  a  given  time,  and  be  accepted  by  his  lodge,  and 
providing  that  in  case  of  rejection  he  must  appeal  to  the  Grand 
Lodge,  a  suspended  member  whose  application  for  reinstatement 
was  rejected,  and  who  did  not  appeal,  is  estopped  from  contesting 
the  validity  of  his  rejection  in  court. 

Montour  vs.  Grand  Lodge,  Oct..  1900.  38  Ore.  47;   62  Pac.  524. 


822  FRATERNAL    SOCIETY    LAW 


THE 

STATE   OF  PEJMNSYLVANIA. 

CHAPTER  39. 

The  following  six  Acts  of  the  Legislature  of  Pennsylvania  com- 
prise the  statute  law  of  that  commonwealth  affecting  Fraternal 
Societies. 

An  Act  regulating  the  organization  and  incorporation  of  Secret 
Fraternal  Beneficial  Societies,  Orders,  or  Associations  and  pro- 
tecting the  rights  of  members  therein. 

Whereas,  Fraternal  beneficial  societies,  orders  or  associations  have 
for  many  years  been  in  existence  in  this  Commonwealth ; 

And  whereas,  The  said  societies,  when  properly  managed,  are 
beneficial  to  the  laboring  and  business  classes,  but  by  reason  of 
there  being  no  statutory  i)rovisious  regulating  tlie  conduct  of  their 
affairs  the  citizens  of  this  Commonwealth  are  unprotected  from 
fraudulent  schemes  and  plans  and  from  the  mismanagement  of 
officers  and  promoters  of  such  societies,  orders  and  associations,  now 
therefore : 

Section  1.  Be  it  enacted  by  the  Senate  and  House  of  Represen- 
tatives of  the  Commonwealth  o±  Pennsylvania  in  General  Assembly 
met,  and  it  is  hereby  enacted  by  the  authority  of  the  same,  That 
from  and  after  the  passage  of  this  act,  any  fifteen  or  more  persons, 
nine  of  whom  shall  be  citizens  and  residents  of  this  Commonwealth, 
having  associated  themselves  as  a  secret  fraternal  beneficial  so- 
ciety, order  or  association,  may  be  incorporated  under  the  provisions 
of  tliis  act  and  when  so  incorporated  the  said  corporation  shall 
have  the  following  powers: 


THE    iSTATE    OF    PENNSYLVANIA  823 

First.  I'o  have  succcssiou  by  its  corporate  iianiL'  perpetually, 
subject  to  the  power  of  the  General  Assembly  under  the  Consti- 
tution of  this  Commonwealth. 

Second.     To  maintain  and  defend  .judicial  proceedini;s. 

Third.  To  make  and  use  a  common  seal  and  alter  the  same  at 
pleasure. 

Fourth.  To  be  capable  of  taking,  receiving,  purchasing,  hold- 
ing and  transferring  real  and  personal  property  for  the  purpose 
of  its  incorporation  and  for  no  other  purpose. 

Fifth.  To  elect,  appoint  and  remove  the  officers  and  agents  for 
the  management  of  its  business  and  carrying  out  its  objects  and 
to  allow  them  a  suitable  compensation. 

Sixth.  To  make  a  constitution  and  general  laws  for  the  manage- 
ment of  its  affairs,  not  inconsistent  with  the  Constitution  and  laws 
of  this  State,  and  to  alter  and  amend  the  same  when  necessary. 
When  so  made,  altered  or  amended,  the  said  constitution  and  general 
laws  shall  be  the  law  governing  such  society,  order  or  association 
and  its  officers,  subordinate  lodges,  councils  or  bodies  and  the  mem- 
bers in  their  relations  to  such  societies,  orders  or  associations  in  all 
their  acts. 

Seventh.  To  provide  in  the  constitution  and  general  laws  for 
the  payment  to  its  members  of  sick,  disability  or  death  claims  in 
such  amounts  as  may  be  authorized  and  directed  by  said  constitution 
and  general  laws.  And  also  to  provide  for  the  payment,  in  not 
less  than  five  years,  to  members  whose  beneficiary  or  distribution 
period  may  then  expire,  of  such  sum  not  exceeding  the  maximum 
amount  named  in  the  beneficiary  certificates  as  the  constitution  and 
general  laws  in  force  at  the  expiration  of  said  period  may  authorize 
and  direct. 

Eighth.  To  collect  from  its  members  by  admission  fees,  dues 
and  assessments  the  funds  necessary  to  carry  on  its  operations  and 
provide  for  the  payment  of  its  benefits,  which  assessments  shall 
be  made  in  manner  and  form  as  ])rovided  by  its  constitution  and 
general  laws. 

Ninth.  To  caiTy  on  its  operations  through  supreme  and  subor- 
dinate bodies  or  lodges  and  to  iss\ie  beneficiary  or  relief  certificates 
in  accordance  with  its  constitution  and  general  laws. 


824  FRATERNAL    SOCIETY    LAW 

Tenth.  To  enter  into  any  obligation  necessary  for  the  trans- 
action of  its  affairs. 

Section  2.  The  charter  of  such  intended  corporation  must  be 
subscribed  by  five  or  more  persons  citizens  of  this  Commonwealth 
and  shall  set  forth: 

First.     The  name  of  the  corporation. 

Second.    The  purpose  for  which  it  is  formed. 

Third.    The  place  where  its  principal  office  is  to  be  located. 

Fourth.    The  names  and  residences  of  the  subscribers. 

Fifth.  The  number  and  names  of  its  officers  with  the  term  or 
terms  of  years  for  which  they  have  been  chosen,  and  also  the  names 
of  not  less  than  six  directors,  managers  or  members  of  an  executive 
committee,  who,  together  with  the  president  of  the  society,  order  or 
association,  shall  form  a  board  of  directors,  managers  or  executive 
committee,  with  the  term  or  terms  of  years  for  which  each  is  to 
serve. 

Section  3.  Notice  of  the  intention  to  apply  for  any  such  charter 
shall  be  inserted  in  two  newspapers  of  general  circulation  printed 
in  the  proper  county  for  three  weeks,  setting  forth  briefly  the  char- 
acter and  object  of  the  corporation  to  be  formed  and  the  intention 
to  make  application  therefor. 

Section  4.  The  said  certificates  of  incorporation  shall  be  acknowl- 
edged by  at  least  five  of  those  who  subscribed  to  them,  before  any 
officer  authorized  to  take  the  acknowledgments  of  deeds  in  the 
Commonwealth  of  Pennsylvania,  to  be  their  act  and  deed,  and  the 
same,  being  duly  certified  under  the  hand  and  official  seal  of  the 
said  officer  shall  be  presented  to  a  law  .judge  of  the  county  in  which 
the  principal  office  of  the  corporation  is  located,  accompanied  by 
proof  of  the  publication  of  the  notice  of  such  application,  who 
is  hereby  authorized  to  peruse  and  examine  said  instrument  and 
if  the  same  shall  be  found  to  be  in  the  proper  form  and  within  the 
purposes  named  in  this  act  he  shall  endorse  thereon  these  facts,  and 
shall  order  and  decree  thereon  that  the  charter  is  aiiproved  and 
that  upon  the  recording  of  the  said  charter  and  order  the  sub- 
scribers thereto  and  their  associates  shall  be  a  corporation  for  the 
purposes  and  upon  the  terms  therein  stated,  and  said  order  and 
charter  shall  be  recorded   in  the  office  for  tlio  recording  of  deeds 


THE    STATE    OF    PENNSYLVANIA  825 

in  and  for  the  county  aforesaid  and  from  thenceforth  the  persons 
named  therein  and  subscribing  the  same  and  their  associates  and 
successors  shall  be  a  corporation  by  the  name  therein  given.  No 
such  corporation,  however,  shall  engage  in  business  until  at  least 
twenty-five  persons  have  subscribed  in  writing  to  be  beneficiary 
members  therein  in  the  aggregiite  amount  of  at  least  five  thousand 
dollars,  and  have  each  paid  in  one  full  assessment  in  cash  amount- 
ing in  the  aggregate  to  at  least  one  per  centum  of  the  amount  in 
which  they  are  beneficiary,  nor  until  a  certificate  signed  and  sworn 
to  by  three  of  the  highest  officei-s  of  the  corporation  has  been  filed 
witli  tJie  Insurance  Commissioner  stating  that  the  requirements  of 
this  section  have  been  complied  with. 

Section  5.  Every  such  fraternal  society,  order  or  association  in- 
corporated under  or  accepting  the  provisions  of  this  act  shall,  on 
or  before  the  first  day  of  March  of  each  year,  make  and  file  with 
the  Insurance  Commissioner  a  report  of  its  affairs  and  operations 
during  the  year  ending  on  the  thirty-fii'st  day  of  December  imme- 
diatel}^  preceding;  such  report  shall  be  iipon  blank  forms  to  be  pro- 
vided by  the  Insurance  Commissioner  and  shall  be  verified,  under 
oath,  by  the  dulj-  authorized  officers  of  such  societ.y,  order  or  asso- 
ciation and  shall  be  in  lieu  of  all  other  reports  required  by  any 
other  law;  the  said  report  shall  contain  answers  to  the  following 
questions : 

First.  Number  of  members  admitted  during  the  year  and  num- 
ber of  beneficiary  certificates  issued. 

Second.     Amovmt  of  benefits  named  in  said  certificates. 

Third.     Number  of  benefit  liabilities  incurred  during  the  year. 

Fourth,     Number  of  benefit  liabilities  paid  during  the  year. 

Fifth.  The  amount  received  from  each  assessment  during  the  year 
and  the  number  of  assessments  levied. 

Sixth.  Total  amount  paid  members,  beneficiaries,  legal  repre- 
sentatives or  heirs. 

Seventh.  Number  aiul  kinds  of  claims  compromised  or  resisted 
and  brief  statement  of  reasons. 

Eighth.  Does  the  corporation  charge  annual  or  other  periodical 
dues  or  admission  fees. 

Ninth.     Total  amount  of  salaries  paid  to  officers. 


826  FRATERNAL    SOCIETY    LAW 

Tenth.     Has  the  society  a  reserve  fund. 

Eleventh.  If  so,  Ijow  is  it  created  and  for  what  purpose,  the 
amount  thereof,  and  how  invested. 

Twelfth.  If  the  custody  and  investment  of  said  reserve  fund  is 
entrusted  to  any  trust  companies  or  corporations  in  the  Common- 
wealth of  Pennsylvania,  state  the  name  of  said  corporation  or  cor- 
porations, the  capital  stock  of  the  same,  the  amount  of  capital  stock 
paid  in,  the  surplus,  if  any.  and  the  place  of  business  of  said  corpo- 
ration or  corporations. 

Thirteenth.  If  the  custody  and  investment  of  said  reserve  fund 
is  entrusted  to  any  of  the  officers  of  the  said  secret  fraternal  bene- 
ficial society,  give  the  names  and  residences  of  the  said  officers, 
the  names  and  residences  of  their  si;reties,  the  amount  of  their  bonds 
and  the  place  or  person  with  whom  the  said  bonds  are  deposited. 

Fourteenth.     State  the  amount  of  said  reserve  fund. 

Fifteenth.  Number  of  certificates  of  membership  lapsed  during 
the  year. 

Sixteenth.     Number  in  force  at  beginning  and  end  of  year. 

Seventeenth.  Date  of  organization  and  incorporation  and  county 
where  incorporated. 

All  such  societies,  orders  or  associations,  together  with  their  books, 
papers  and  vouchers,  shall  be  subject  to  visitation  and  inspection  by 
the  insurance  conmiissiouer  or  such  person  or  persons  as  he  ma.v 
at  any  time  designate.  Any  such  society,  order  or  association  re- 
fusing or  neglecting  to  make  such  report  to  the  insurance  commis- 
sioner may,  upon  the  suit  of  the  commonwealth,  be  enjoined  by  the 
court  of  common  pleas  of  Dauphin  county  from  carrying  on  any 
business  until  such  report  shall  be  made. 

Section  6.  Every  officer  of  any  corporation  accepting  the  pro- 
visions of  or  doing  business  under  this  act  shall  give  bond  with  suf- 
ficient surety  for  the  faithful  performance  of  his  duties,  and  for  the 
safe  custody  of  the  moneys  and  securities  and  other  property 
which  may  be  in  his  possession  and  control,  M'hich  bond  shall 
be  for  such  amount  as  the  board  of  directors,  managers,  exec- 
utive committee  or  supreme  governing  body  may  require:  Pro- 
vided however,  That  when  the  reserve  funds  of  any  corporation 
organized  hereunder  or  accepting  the  provisions  hereof  are  deposited 


THE    HTATE    OF    PENNSYLVANIA  827 

for  iiivcsluiciit  with  ;jiiy  trust.  ('()in]);iiiirs  or  liiuiiicial  corporations 
chartered  Id.v  the  Coiiinionwcjiltli  of  Peiiiisylvauia,  the  officers  of  said 
corporation  so  depositing  its  reserve  funds  need  not  be  bonded  for 
any  of  the  moneys  or  seenrities  in  the  custody  or  possession  of  said 
trust  eonipanies  oi"  fiiuineial  coriMii-atious.  The  insuivince  commis- 
sioner shall  have  the  power  and  authority  at  all  times  to  examine 
said  bonds  at  the  place  of  business  of  the  corporation,  and  there  to 
inquire  of  and  receive  answers  from  the  officers  of  the  corporations 
as  to  their  knowledge  of  the  financial  standing  of  the  surety  or  sure- 
ties on  any  of  said  bonds. 

Section  7.  Any  beneficial  society,  order  or  association  heretofore 
incorporated  under  any  act  of  the  general  assembly  of  the  common- 
wealth of  Pennsylvania  for  licneficial  (U'  protective  purposes  to  its 
members  from  funds  collected  therein,  and  which  has  been  carrying 
on  the  operations  of  a  secret  fraternal  society,  order  or  association, 
and  any  unincorporated  society,  order  or  association  which  has  been 
carrying  on  said  operations,  shall  have  and  enjoy  the  rights  and 
privileges  conferred  by  this  act,  upon  filing  with  the  insurance  com- 
missioner a  certificate  or  declaration,  signed  by  its  supreme  officers 
accepting  the  provisions  of  this  act  and  agreeing  to  abide  by  all 
the  requirements  herein  made:  Provided,  however.  That  nothing 
in  this  act  shall  apply  to  any  incorporated  or  unincorporated  fra- 
ternal i)enefieial  society  not  accepting  thi?  provisions  hereof,  or  Ix' 
so  construed  as  to  compel  any  such  society  to  accept  its  provisions  or 
become  incorporated  thereunder. 

Approved— -The  6th  day  of  April,  A.  D.  1893,  (P.  L.  10.) 

An  Act  defining  Fraternal  Beneficial  and  Relief  Societies  and  their 
status,  authorizing  them  to  create  subordinate  lodges  and  to  pay 
benefits  upon  the  sickness,  disability  or  death  of  their  members 
from  funds  collected  by  dues  and  assessments  therein  providing 
for  their  registration  in  the  office  of  the  Insurance  Commissioner, 
and  requiring  that  they  shall  make  annual  reports  to  him,  and 
exempting  them  from  taxation  and  from  the  supervision  of  the 
Insurance  Commissioner. 

Section  1.  Be  it  enacted  by  the  Senate  and  House  of  Representa- 
tives of  the  Commonwealth  of  Ponnsvlvania  in  eeneral  Assemblv  met. 


I 


828  FRATERNAL    SOCIETY    LAW 

and  it  is  hereby  enacted  by  the  authority  of  the  same,  That  it  shall 
be  lawful  for  any  cox'poratiou,  society  or  vohintarj'  association,  now 
or  hereafter  formed  or  organized  and  carried  on  for  the  sole  benefit 
of  its  membei's  and  their  beneficiaries  and  not  for  profit,  to  have  and 
create  subordinate  lodges  with  ritualistic  form  of  work  and  a  repre- 
sentative form  of  government,  and  to  issue  certificates  of  member- 
ship, make  provision  for  the  payment  of  benefits  in  case  of  sickness, 
disability  or  death  of  its  members,  subject  to  their  compliance  with 
its  constitution  and  laws  in  which  the  fund  from  which  the  payment 
of  such  benefits  shall  be  made,  and  the  expenses  of  such  association 
shall  be  defrayed  and  shall  be  derived  from  assessments  or  dues 
collected  from  its  members,  and  in  which  the  payment  of  death  bene- 
fits shall  be  to  families,  heirs,  blood  relatives,  affianced  husband  or 
affianced  wife  of  or  to  persons  dependent  upon  the  members. 

Such  corporation,  society  or  voluntary  association  now  existing, 
or  hereafter  formed  or  organized,  shall  be,  and  is  hereby  declared  to 
be  a  fraternal  beneficial  society,  and  shall  be  goveraed  by  this  act, 
and  shall  be  exempt  from  the  provisions  of  insurance  laws  of  this 
State,  and  no  law  hereafter  passed  shall  be  applied  to  them  unless 
they  be  expressly  designated  therein.  All  funds  of  such  fraternal 
beneficial  societies  shall  be  exempt  from  the  State  tax  on  money  at 
interest. 

Section  2.  "Within  sixty  days  after  the  passage  of  this  act  all 
supreme  or  grand  or  other  bodies  which  may  be  known  to  constitute 
the  head  of  any  fraternal  beneficial  society  doing  business  within 
this  Commonwealth,  as  provided  in  the  first  section  of  this  act,  shall 
file  through  its  proper  officers  or  representatives  with  the  insurance 
Commissioner  a  copy  of  their  constitution  and  general  laws,  and 
annually  any  alterations,  changes  or  amendments,  whose  duty  it 
shall  be  to  register  them,  without  charge,  in  the  Insurance  Depart- 
ment as  fraternal  beneficial  societies  and  when  so  registered,  they 
shall  be  exempt  from  any  and  all  fees  and  taxes  imposed  by  exist- 
ing laws  upon  insurance  companies  reporting  to  said  department. 

Section  3.  The  executive  officers  of  each  such  supreme  or  grand 
lodge  of  any  fraternal  beneficial  society  doing  business  in  this  Com- 
monwealth shall,  on  or  before  the  first  day  of  March,  of  each  year, 
make  a  report  under  oath,  on  a  blank  to  be  provided  by  the  Insur- 


THE    STATE    OF    PENNSYLVANIA  829 

ance  Commissioner,  which  report  shall  be  printed  as  a  part  of  his 
annual  report  of  the  operations  of  said  society  in  this  Commonwealth 
for  the  preceding  fiscal  year  eiidinu-  Dcccnihcr  thirty-first,  in  forms 
as  follows: 

I. 

Name  of  the  society  or  association,  with  its  principal  office  or  place 
of  business. 

II. 

Income. 

First.     Annual  Dues. 

Second.     Assessments. 

Third.     All  other  sources. 

Fourth.     Total  income  during  the  year. 

III. 

Expenditures. 

First.     Losses  and  claims  paid. 

Second.     Salary  and  other  compensation  of  officers. 

Third.     Rent. 

Fourth.     Office  expenses. 

Fifth.     All  other  expenditures. 

IV. 

Assets. 

First.     Real  estate. 
Second.     Loans  on  mortgages. 
Third.     Bonds  and  stock  owned  absolutely. 
Fourth.      Cash  in  office  or  bank. 

Fifth.     Due  from  members  on  assessments  called  on  pending  col- 
lection. 

Sixth.     All  other  assets.     (Stating  character.) 


830  FRATERNAL    SOCIETY    LAW 


Liabilities. 

First.     Losses  and  claims  unpaid. 

Second.     Salaries  due  and  uuiiaid. 

Tliird.     Borrowed  money. 

Fourth.     All  other  liabilities.     (Stating  character.) 

VL 

Exhiliit  lit'  iiienibershij). 

First.  Tiital  membership  in  S'ood  standing-  December  tliirty-first, 
one  thousand  hundred  and  .     Number. 

Second.  Total  number  of  members  received  by  initiation  or  re- 
admission  during  the  year.    Number. 

Third.    Total  Number. 

Fourth.  Deduct  members  retiring  b.y  withdrawal  or  suspension 
during  the  year.    Number. 

Fifth.     Deduct  members  who  have  died  during  the  year.    Number. 

Sixth.  Total  members  in  good  standing  December  thirty-first, 
one  thousand hundred  and .    Number. 

Section  4.  Any  fraternal  beneficial  society  failing  to  register  as 
required  by  the  second  section  of  this  act  or  to  make  the  report  re- 
quired by  the  third  section  of  this  act,  shall  br  [irohibited  from  doing 
business  in  this  State,  and  the  officers  of  societies  violating  these  re- 
quirements shall  be  deemed  guilty  of  a  misdemeanor  and  upon  con- 
viction shall  be  fined  not  exceeding  one  hundred  dollars  for  each 
oflfense :  Provided  always.  That  nothing  in  this  act  shall  be  so  con- 
strued as  to  give  the  Insurance  Commissioner  any  supervision  or 
authority  in  any  matter  or  thing  whatsoever  pertaining  to  the  busi- 
ness of  any  fraternal  society  as  prescribed  in  the  first  section  of  this 
act,  other  than  is  expressly  provided  for  in  the  second  and  third 
sections  hereof:  And  provided  furthei-.  That  all  beneficial  and  relief 
associations  formed  by  cliurehes.  societies,  classes,  firms  or  corpora- 
tions with  or  witlioiil  ritualistic  form  of  w(U'lc.  the  privileges  and 
membership  in  which  are  confined  to  the  members  of  such  churches, 
societies  or  classes  and  to  members  and  employes  of  such  firms  or 


THE    STATE    OF    PENSSYLVASIA  831 

cur|ior,i1i()ns,  shall  be  exempt  from  the  pi-ovisioiis  of  this  act:  And 
prdvidcd  I'lirther,  That  this  act  shall  not  apply  In  niiy  secret  fraternal 
beucticial  society,  order  or  association  which  has  for  one  of  its  ob- 
jects, the  payment  of  a  sum  not  exceeding  a  certain  aiiiomit  at  the 
expiration  of  a  fixed  period. 

A|)pi'ovcd— The  (ith  day  of  April,  A.  D.  1893.     (P.  L.  7.) 

An  Act  defining  to  whom  the  benefit  certificates  issued  by  Fraternal 
Societies  paying  benefits  upon  the  death  of  their  members  by 
mutual  assessments  shall  be  paid,  where  the  person  or  member 
dies  without  leaving  a  person  designated  to  receive  the  same. 

Section  1.  lie  it  enacted  by  the  Senate  and  House  of  Representa- 
tives of  the  Commonwealth  of  Pennsylvania  in  General  Assembly  met, 
and  it  is  hereby  enacted  by  the  authority  of  the  same,  That  from  and 
after  the  passage  of  this  act  any  benefit  certificate  or  certificates  now 
or  hereafter  issued  by  any  corporation,  society  or  voluntary  asso- 
ciation now  or  hereafter  formed  or  organied  and  carried  on  for 
the  sole  benefit  of  its  members  and  their  beneficiaries  and  not  for 
profit,  when  any  person  or  persons  shall  have  been  designated  by 
the  members  as  his  beneficiary  or  beneficiaries  shall  die  prior  to  the 
death  of  the  member  without  any  new  designation,  and  no  provision 
is  made  by  the  laws  of  the  society  as  to  w'hom  shall  take  the  share 
designated  to  go  to  such  deceased  beneficiary  or  beneficiaries,  in  all 
such  cases  the  amount  or  share  designated  to  be  paid  to  such  de- 
ceased beneficiary  or  beneficiaries  shall  be  payable  to  the  widow  and 
children  of  such  deceased  member,  if  any,  share  and  share  alike,  and 
in  case  none  such  be  living,  then  to  such  other  relatives  of  such 
deceased  members,  and  in  such  proportions  as  they  are  entitled  to  re- 
ceive under  a  distribution  of  the  personal  estate  liy  the  laws  of  the 
domicile  of  such  member. 

Approved— The  24th  day  of  May,  A.  D.  1893.     (P.  L.  126.) 

An  Act  to  provide  for  the  person  upon  whom  service  shall  be  had 
by  legal  process  in  the  case  of  Fraternal  Beneficial  and  Relief  So- 
cieties whose  status  is  defined  by  the  act  of  Assembly,  entitled 
An  Act  defining  Fraternal  Beneficial  and  Relief  Societies  and  their 
status,  authorizing  them  to  create  subordinate  lodges  and  to  pay 


832  FRATERNAL    SOCIETY    LAW 

benefits,  upon  the  sickness,  disability  or  death  of  their  members, 
from  funds  collected  by  dues  and  assessments  therein,  providing 
for  their  registration  in  the  office  of  the  Insurance  Commissioner, 
and  requiring  that  they  shall  make  annual  reports  to  him,  and  ex- 
empting them  from  taxation  and  from  the  supervision  of  the  In- 
surance Conmiissioner, "  approved  the  sixth  day  of  April,  Anno 
Domini  one  thousand  eight  hundred  and  ninety-three. 

Section  1.  Be  it  enacted,  etc.,  That  any  fraternal  beneficial  or 
relief  society,  as  defined  under  the  provisions  of  the  first  section  of 
the  act  of  assembly,  entitled  "An  act  defining  fraternal  beneficial- 
and  relief  societies  and  their  status,  authorizing  them  to  create  sub- 
ordinate lodges  and  to  pay  benefits,  upon  the  sickness,  disability  or 
death  of  their  members,  from  funds  collected  by  dues  and  assess- 
ments therein,  providing  for  their  registration  in  the  office  of  the  in- 
surance commissioner,  and  requiring  that  they  shall  make  annual  re- 
ports to  him,  and  exempting  them  from  taxation  and  from  the 
supervi.sion  of  the  insurance  commissioner,"  approved  the  sixth  day 
of  April  Anno  Domini  one  thousand  eight  hundred  and  ninety-three, 
now  doing  or  hereafter  admitted  to  do  l)usiness  within  this  State, 
and  not  having  its  principal  office  within  this  State,  and  not  being 
organized  under  the  laws  of  this  State  shall  appoint,  in  writing,  the 
commissioner  of  insurance  or  his  successor  in  office  to  be  its  true  and 
lawful  attorney  upon  whom  all  lawful  process  in  any  action  or  pro- 
ceeding against  it  may  be  served,  and  in  such  writing  shall  agree 
that  any  lawful  process  against  it  which  is  served  on  said  attorney 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
association,  and  that  the  authority  shall  continue  in  force  so  long 
as  any  liability  remains  outstanding  in  this  State;  copies  of  such 
certificate  certified  by  said  commissioner  of  insurance  shall  be 
deemed  sufficient  evidence  thereof  and  shall  be  admitted  in  evidence 
with  the  same  force  and  eft'ect  as  the  roiginal  thereof  might  be  admit- 
ted. Service  upon  such  attorney  shall  be  deemed  sufficient  service 
upon  such  association.  When  legal  process  against  any  such  asso- 
ciation is  served  upon  said  commissioner  of  insurance  he  shall 
immediiitply  notify  the  association  of  such  service,  by  letter  prepaid 
and  directed  to  its  supreme  secretiirv  or  corresponding  officer,  and 
shall  williiii  (wo  <la\s  afler  such  service.  f(irwar<l  in  the  same  manner 


THE    STATE    OB'    PENNSYLVANIA  833 

a  copy  of  the  process  served  on  liim  to  sucli  officer:  Provided  liow- 
ever,  That  such  process  shall  be  served  at  least  thirty  days  prior 
to  the  return  day  of  the  same.  The  plaintiff  in  such  process  so 
served  shall  pay  to  the  commissioner  of  insurance  at  the  time  of  such 
service  a  fee  of  three  dollars,  which  shall  be  recovered  by  him  as 
part  of  the  taxable  costs  if  he  prevails  in  the  suit.  The  commissioner 
of  insurance  shall  keep  a  record  of  all  processes  served  upon  him, 
vyhich  record  shall  show  the  day  and  hour  when  such  service  was 
made. 

Section  2.  All  societies  mentioned  in  the  first  section  of  this  act 
now  doing  business  within  this  State  shall  comply  with  the  pro- 
visions of  this  act  within  thirty  days  from  the  passage  of  the  same, 
and  all  such  societies  hereafter  applying  for  authority  to  do  business 
in  this  State  shall  comply  with  its  provisions  as  a  condition  pre- 
cedent to  doing  business  in  the  state. 

Approved— The  25th  day  of  June,  A.  D.  1895.     (P.  L.  280.) 

An  Act  to  punish  frauds  upon  Life  Insurance  Companies  by  agents, 
physicians  and  others. 

Section  1.  Be  it  enacted,  etc..  That  any  agent  of  a  mutual,  stock 
or  co-operative  life  insurance  company  or  association,  physician  or 
other  pei'son  whatsoever  who  shall  knowingly  make,  or  be  concerned, 
or  interested  in  making,  any  misrepresentation  or  false  statement, 
for  the  purpose  of  securing  from  any  mutual,  stock  or  co-operative 
life  insurance  eompan.y  or  association  a  policy  of  insurance  or  cer- 
tificate of  membership  upon  his  own  life,  or  the  life  of  any  other 
person,  shall  be  guilty  of  a  misdemeanor,  and  upon  conviction  thereof 
be  fined  not  exceeding  one  thousand  dollars,  or  undergo  imprison- 
ment not  exceeding  one  year,  or  both,  in  the  discretion  of  the  court. 

Approved— The  10th  day  of  June,  A.  D.  1881.     (P.  L.  109.) 

An  Act  to  enable  minors,  above  the  age  of  eighteen  years,  to  contract 
for  membership  in  Fraternal  Beneficial  Societies. 

Section  1.     Be  it  enacted,  etc.,  That  from  and  after  the  passage 
of  this  act  It  shall  be  lawful  for  minors,  who  have  attained  the  age 
of  eighteen  years,  to  make  all  needful  contracts  to  become  members 
53 


834  FRATERNAL    SOCIETY   LAW 

of  fraternal  and  beneficial  societies  lawfully  organized  and  doing 
business  under  the  laws  of  this  commonwealth. 

Approved— The  24th  day  of  June,  A.  D.  1897.     (P.  L.  204.) 

Warranty,  Immateriality  of  Answers  Under. 

In  an  action  upon  an  insurance  contract  where  the  iindisputed 
evidence  is  that  the  insured  in  his  application  had  falsely  stated 
that  he  never  had  any  illness  and  had  not  consulted  a  physician,  it 
is  error  for  the  court  to  submit  the  question  of  the  materiality  of  the 
answers  in  the  application  to  the  jury. 

Lutz  vs.  Metropolitan  Life  Ins.  Co.,  July,  1S98,  186  Pa.  St.  527; 
March  vs.  Met.  Life  Ins.  Co.,  July,  1898,  186  Pa.  St.  629; 
Keatley  vs.  Travelers  Ins.  Co.,  July,  1898,  187  Pa.  St.  197. 

Suicide,  Sane  or  Insane  Clause,  Valid. 

No  recover^'  can  be  had  on  a  contract  of  life  insurance  where  the 
insured  has  killed  himself  while  insane,  if  it  is  a  condition  of  the 
contract  that  it  shall  be  void  in  case  the  person  whose  life  is  insured 
shall  die  by  suicide,  sane  or  insane. 

Sargeant  vs.  National  Life  Ins.  Co.,  Jan.,  1899,  189  Pa.  St.  341. 

Evidence — Agent  Competent  Witness. 

An  agent  of  a  life  insurance  company  who  took  the  application 
is  not  an  incompetent  witness  because  the  insured  is  dead.  An 
agent  who  makes  a  contract  is  not  a  party  to  the  same ;  it  is  the 
principal  for  whom  the  agent  acted  who  is  the  surviving  party  to 
the  contract. 

Sargeant  vs.  National  Life  Ins.  Co.,  Jan.,  1899,  189  Pa.  St.  341. 

Warranty,  in  Cases  of  Breach  Directed  Verdict  Proper. 

In  an  action  upon  a  contract  of  insurance  where  the  uncontra- 
dicted evidence  for  the  insurance  company  established  the  fact  that 
the  insured  had  falsely  stated  in  his  application  that  he  had  not 


THE    STATE    OF    PENNSYLVANIA  835 

Ix'cii  rejected  by  ;iiiy  iMiiiipjiiiy.  aiul  tliiit  lir  liad  had  no  serious  ill- 
ness, while  in  fact  he  had  a  fatal  disease  of  which  he  died  in  about 
foiu'  HU)iiths  thereafter,  it  is  i)roper  for  the  trial  judge  to  direct  a 
verdict    in    favor   of  the   company. 

Meyer-Bruns  vs.  Penn.  Miit.  Life  Ins.  Co.,  Jany.,  1899,  189  Pa.  St.  579. 

Warranty,  Parol  Statements  Not  Allovvrable  to  Vary. 

In  an  action  upon  ii  contract  where  the  application  showed  that 
the  insured  had  falsely  stated  that  he  had  not  been  rejected  by 
another  company,  evidence  that  at  the  time  the  insured  was  being 
examined  he  stated  to  the  medical  examiner  that  he  had  been  re- 
jected by  another  company  and  that  the  examiner  had  told  him 
that  the  other  company  was  a  beneficial  and  not  an  old  line  comjjany 
and  that  his  rejection  would  not  att'ect  his  conti'act,  was  not  com- 
petent to  rebut  the  .statement  in  the  application. 

Meyer-Bruns  vs.  Penn.  Mut.  Life  Ins.  Co.,  Jany.,  1899,  189  Pa.  St.  579. 

Contract,   Liability  Begins  When — Worthless  Check  not  Payment 
of  Premium. 

Where  a  contract  of  insurance  provides  that  the  policy  shall  not 
be  binding  until  the  first  premium  shall  have  been  paid,  and  it  ap- 
pears in  an  action  upon  the  policy  that  the  company  had  received 
nothing  from  the  insured  except  a  worthless  check,  the  policy 
should  not  be  admitted  in  evidence  and  a  judgment  of  nonsuit 
against  the  plaintiff'  is  properly  entered. 

Brady  vs.  Northwestern  Masonic  Aiii  Assn..  April.  1899,  190  Pa.  St. 
595. 

Warranty,  Evidence  Under. 

In  an  action  upon  a  contract  of  insurance  where  the  defense  is 
that  the  insured  in  his  application  made  false  answers  as  to  his 
health,  and  four  witnesses  for  the  defendant  are  contradicted  by 
sixteen  witnesses  for  the  plaintiff,  the  case  is  for  the  jury;  and  if 


836  FRATERNAL    SOCIETY    LAW 

the  evidence  be  fairly  and  clearly  submitted  to  them,  a  verdict  and 
judgment  for  plaintiff  will  be  sustained. 

Wall  vs.  Royal  Society  of  Good  Fellows,  Oct..  1S99,  192  Pa.  St.  577. 

Warranty — Breach  of — Verdict  for  Society, 

In  an  action  upon  a  life  insurance  contract  where  it  appears  that 
the  insured  stated  in  his  application  that  he  never  had  any  serious 
illness,  when  the  undisputed  evidence  showed  that  a  few  months 
before  the  date  of  the  application  he  had  been  seriously  ill  with 
typhoid  fever,  the  defendant  is  entitled  to  binding  instructions. 

Meyers  vs.  Woodmen  of  the  World,  Nov.,  1S99,  193  Pa.  St.  470. 

Identity,  Evidence  of. 

In  an  action  against  a  life  insurance  company  where  the  only 
question  at  issue  is  the  identity  of  a  dead  body  with  that  of  the 
insured,  the  case  is  for  the  jury  where  both  parents  of  the  insure<l 
declare  an  absolute  identity  of  the  dead  body  with  the  person  of 
their  son,  the  coroner  identifies  it  from  photographic  pictures  well 
authenticated,  and  the  absence  of  teeth  correspond  with  the  vacant 
spaces  in  the  jaw,s  of  the  deceased. 

Potter  vs.  Union  Central  Lite  Ins.  Co.,  April,  1900,  195  111.  557. 

Warranty,  Breach  of.  Avoids  Contract. 

"Where  an  applicant  warrants  that  his  answers  shall  be  true,  fail 
and  fair,  and  in  answer  to  a  question  states  that  he  had  not  since 
childhood  had  the  disease  or  disorder  of  spitting  or  raising  of  blood, 
while  the  uncontradicted  evidence  was  that  he  had  spit  blood,  was 
frightened  and  had  consulted  a  physician  about  it,  the  answer  being 
if  not  untrue  not  full  and  fair,  and  being  material  to  the  risk,  it 
voided  the  policy. 

Smith  vs.  Northwestern  Mut.  Life  Ins.  Co.,  May,  1900,  196  Pa.  St.  314. 


THE    STATE    OF    PENNSYLVANIA  837 

Receiver  for  Insolvent  Society. 

A  bill  in  equity  by  a  certificate  holder  of  a  mutual  life  insurance 
companj'  for  a  receiver  which  does  not  aver  insolvency  and  is  not 
instituted  for  the  purpose  of  closing  up  the  affairs  of  the  society  is 
not  fatally  defective  because  the  insurance  commissioner  is  not 
joined  as  a  party  defendant. 

Treat  vs.  Penn.  Mut.  Life  Ins.  Co.,  May,  1901,  199  Pa.  St.  326. 

Beneficiary,  Naming  of  by  Will. 

Where  a  member  states  in  his  application  that  the  insurance  shall 
he  paid  to  the  devisees  under  his  will,  or  in  case  of  their  death,  to 
his  heirs  at  law,  and  the  society  certifies  that  it  agrees  to  pay  to 
his  devisees,  or  if  no  will  specifically  bequeathing  the  benefits  which 
shall  be  payable  on  account  of  this  certificate  shall  appear  and  be 
brought  to  the  knowledge  of  the  society  within  60  days  after  the 
death  of  the  member,  then  to  the  heirs  at  law  of  the  member,  and 
the  member  by  his  will  gives,  devises  and  bequeathes  all  his  property 
to  his  wife,  the  wife  is  entitled  to  the  insurance  money. 

House  vs.  Northwestern  Life  Assurance  Co.,  July,  1901,  200  Pa.  St. 
173. 

Suicide,  Sane  or  Insane  Clause  Valid. 

No  recovery  can  be  had  upon  a  contract  where  the  member  has 
killed  himself,  if  the  contract  contains  the  following  provision : 

"If  the  member  holding  this  certificate  shall  die  within  three  years 
after  becoming  a  member  of  this  society,  as  a  result  of  any  means 
or  act  which,  had  such  means  or  act  been  used  or  done  by  him 
while  in  possession  of  all  his  natural  faculties  unimpaired,  would 
be  deemed  self-destruction,  then  this  certificate  shall  be  null  and 
void  and  of  no  eff^ect. " 

Keefer  vs.   Modern  Woodmen   of   America,   May,   1902,    203    Pa.    St. 
129-131. 


838  FRATERNAL   SOCIETY   LAW 

Tribunals  of  Society,  Decisions  of  Binding. 

WluTy  the  coijstitution  of  a  society  provides  that  the  loss  of  a 
hand,  foot,  or  eye  shall  be  deemed  a  total  disability,  but  that  whether 
any  other  injury  shall  be  deemed  a  total  disability  shall  be  deter- 
mined by  a  tribunal  established  by  the  constitution,  the  decision 
of  such  tribunal  is  binding  upon  the  members. 

Sanderson  vs.  Brotherhood  of  Railroad  Traintaen,  Nov.,  1902,  204  Pa. 
St.   182. 

Warranty,  Duty  of  Court  to  Instruct  in  Case  of  Breach  of. 

Where  an  applicant  warrants  the  truth  of  the  statements  made 
in  his  aj^plication,  and  sets  forth  therein  that  he  never  had  any 
spitting  of  blood  or  any  serious  illness,  and  the  evidence  offered 
by  the  company  tends  to  show  that  the  insured  had  consumption 
during  the  year  prior  to  the  date  of  the  policy,  and  died  of  that 
disease  thereafter,  it  is  the  duty  of  the  trial  court  to  instruct  the 
jury  that  the  statements  contained  in  the  application  were  material 
to  the  risk,  and  that  if  they  were  found  to  be  false  or  untrue,  they 
would  avoid  the  policy. 

Murphy  vs.  Prudential  Ins.  Co.,  May,  1903,  205  Pa.  St.  444. 

Beneficiary — ' '  Nearest  Friend. ' ' 

A  member  of  an  imincorporated  society  named  his  wife  as  beue- 
ficiaiy,  and  she  so  remained  for  eighteen  years,  when  she  died. 
At  the  time  when  the  certifieate  was  issued  a  member  had  the  right 
to  change  a  beneficiary  and  designate  another.  After  the  death  of 
his  wife  the  member  substituted  the  name  of  a  pei'.son  described  as 
his  nearest  friend  as  beneficiary.  Tlie  change  was  in  accordance 
with  the  laws  of  the  order  and  was  approved  by  its  officers,  but 
on  the  death  of  the  member  his  sister  claimed  the  proceeds  of  the 
certificate  as  his  only  surviving  heir  at  law.  Held,  that  she  was  not 
entitled  to  th(>  fund  and  that  it  was  payable  to  the  person  named  m 
the  certificate. 

Schoale.s  vs.  Order  of  Si)arta.  May.  1903.  206  Pa.  St.  11. 


THE    STATE    OF   PENNSYLVANIA  839 

Beneficiaries — Not  Affected  by  Subsequent  Changes  in  Law. 

The  act  of  April  6,  1893,  limiting  the  payment  of  death  benefits 
by  fraternal  societies  to  "families,  heirs,  blood  relatives,  affianced 
husband  or  affianced  wife,  or  to  persons  dependent  upon  the  mem- 
ber" is  prospective  in  its  application  and  not  retrospective,  and 
does  not  affect  the  rights  of  holders  of  certificates  issued  prior  to 
that  time. 

Schoales  vs.  Order  of  Sparta,  May,  1903,  206  Pa.  St.  11. 

Beneficiary — No  Vested  Interest. 

There  is  no  vested  interest  in  the  beneficiary  under  a  fraternal 
society  contract,  but  only  an  expectancy  which  cannot  become  a 
vested  or  absolute  right  until  the  death  of  the  member. 

Brown  vs.  A.  O.  U.  W.,  Jany.,  1904,  208  Pa.  St.  101. 

Beneficiary — Right  of  Divorced  Wife. 

Where  the  laws  of  a  society  provided  that  a  member  might 
designate  as  his  beneficiary  a  member  of  his  family,  one  related  to 
him  by  blood,  or  one  dependent  upon  him,  and  did  not  require  the 
beneficiary  to  belong  to  one  of  the  specified  classes  at  the  death 
of  the  member,  and  the  member  designated  his  wife  as  beneficiary, 
and  gave  her  the  certificate,  which  she  retained  until  his  death 
twenty-four  years  thereafter,  such  beneficiary  will  be  entitled  to 
the  benefit  although  the  member  was  divorced  from  her  eight  years 
before  his  death,  and  subsequently  remarried  but  continued  to  sup- 
port his  first  wife  and  her  children  until  his  death,  and  never  made 
any  change  in  the  certificate. 

Brown  vs.  A.  O.  U.  W.,  Jany.,  1904,  208  Pa.  St.  101. 

Trust  Fund — Society  Holds  Members'  Payments  as  Such. 

A  fraternal  society  sustains  a  relation  towards  its  members  other 
than  that  of  a  mere  life  insurance  company.     The  fund  which  it 


840  FRATERNAL    SOCIETY    LAW 

controls  is  a  trust  fund,  made  up  of  eontributious  of  the  members. 

Blair  vs.  Supreme  Council  American  Legion  of  Honor,  March,  1904, 
208  Pa.  St,  262.  ' 

Beneficiaries — Brother  as  Trustee  for  Wife. 

Where  the  charter  of  a  society  declared  one  of  the  objects  of  the 
corporation  to  be  the  payment  to  the  "widows,  orphans,  dependents, 
or  other  beneficiary"  whom  the  member  has  designated  as  the  ob- 
jects of  the  fund,  and  tlie  constitution  states  one  of  the  objects  of 
the  society  to  be  the  payment  to  the  member  or  his  wife,  or  his 
afHanced  wife,  or  his  children,  or  his  blood  relations,  or  persons 
dependent  upon  the  member  whom  he  may  have  designated,  it  was 
held  that  a  brother  may  be  designated  as  beneficiary,  but  that  if  it 
appears  that  the  brother  was  inserted  without  his  knowledge  as 
trustee  for  the  member's  wife,  who  was  at  the  time  a  minor,  the 
trust  will  be  enforced,  and  at  the  wife's  majority  the  fund  will  be 
paid  to  her. 

Donithen   vs.   Independent   Order   of   Foresters,    May,   1904,   209   Pa. 
St.  170. 

Beneficiary,  Rights  of  Creditors. 

As  to  the  right  of  a  member  to  have  the  amount  of  his  benefit  paid 
over  to  a  creditor.    See 

Fodell  vs.  Miller,  Dec,  1S99,  193  Pa.  St.  570. 

Contract,  When  Liability  Begins  Under. 

A  fraternal  society  having  two  classes  of  member.?,  social  and 
beneficiary,  cannot  be  made  liable  for  death  benefits  for  one  who 
qualified  as  a  social  member  but  paid  dues  as  a  beneficiary  member 
wnth  the  understanding  that  if  he  did  not  pass  the  provided  medical 
examination  a  ])()r1i()ii  <if  his  beneficiary  dues  were  to  be  apj^lied  to 
his  social  dues  and  the  balance  returned  to  him,  but  who  never 
underwent  an  examination  to  determine  if  he  was  eligible  to  bene- 
ficiary membership. 


THE    STATE    OF    PENNSYLVANIA  841 

Asselto  vs.  Supreme  Tent  Knights  of  the  Maccabees,  May  1899,  192 
Pa.  St.  5. 

Insolvent — Rights  of  Members  in  Cases  of  Society  Being. 

A  member  of  an  insolvent  society  who,  with  ample  notice  of  the 
'  proceedings,  stands  by  and  permits  a  decree  of  dissolution  of  the 
society  to  be  entered  by  which  the  officers  are  directed  to  transfer 
the  assets  to  another  company  in  consideration  of  the  latter  rein- 
suring the  members  of  the  society,  cannot  after  the  delay  of  a  year 
and  the  distribution  of  the  assets  in  accordance  with  the  decree,  be 
heard  to  complain. 

In  re  Mut.  Benefit  Co.  ot  Penna.,  March,  1899,  190  Pa.  St.  355. 

Forfeiture — Reinstatement  Optional  with  Society. 

A  by-law  of  a  society  which  provides  that  the  executive  com- 
mittee shall  have  power  to  reinstate  a  delinquent  member  at  any 
time  within  a  year  on  satisfactory  evidence  of  good  health,  and  upon 
payment  of  all  delinquent  premiums,  does  not  give  a  delinquent 
member  a  legal  or  equitable  right  to  reinstatement  against  the  will 
of  the  executive  committee.  Though  the  apijlicatiou  for  reinstate- 
ment be  made  in  time  and  the  member  be  ready  and  willing  to  fully 
comply  with  all  the  terms  and  conditions  of  the  by-law,  the  com- 
mittee is  not  bound  to  grant  the  application. 

Harrington  vs.  Keystone  Mut.  Benefit  Assn.,  Feb.,  1S99,  190  Pa.  St. 
77. 

Beneficiary,  Right  of  Member  to  Change,  Absolute. 

The  right  of  a  member  in  good  standing  to  change  the  bene- 
ficiary named  in  his  certificate  by  the  substitution  of  another  of 
the  class  entitled,  is  absolute.  Neither  the  assent  of  the  beneficiary 
nor  the  surrender  of  the  certificate  was  necessary'.  This  right  was 
reserved  in  the  application  and  in  his  certificate  and  has  been  recog- 
nized by  the  order  as  fundamental,  and  it  has  been  fully  sustained 
by  the  decisions  of  this  court. 

Hamilton  vs.  Royal  Arcanum,  Jan.,  1899,  1S9  Pa.  St.  273. 


842  FRATERNAL    SOCIETY    LAW 

Expulsion,  When  Right  may  be  Exercised. 

Coui'ts  may  by  mandamus  compel  the  restoration  of  a  member 
expelled  from  a  society,  and  where  the  charter  contains  no  power  of 
expulsion,  a  member  can  be  expelled  only  when  he  has  been  guilty  of 
some  infamous  offense  or  has  done  some  act  tending  to  the  destruc- 
tion of  the  society. 

Weiss  vs.  Musical  Mut.  Protective  Union,  Jan.,  1899,  189  Pa.  St.  446. 

Suicide — Sane  or  Insane  Clause  Valid. 

A  by-law  providing  that  no  benefit  shall  be  paid  on  account  of 
the  death  of  a  member  from  suicide  within  five  years  after  admis- 
sion, whether  the  member  taking  his  own  life  was  sane  or  insane 
at  the  time,  is  valid  and  legal. 

Chambers  vs.  Supreme  Tent,  Knights  of  the  Maccabees,  July,  1901, 
200  Pa.  St.  244. 

After-enacted  Suicide  Laws  Valid. 

Where  at  the  time  a  per.sou  became  a  member  of  a  society  the 
by-laws  provided  that  benefit  should  not  be  paid  on  account  of  the 
death  of  a  member  from  suicide  within  one  year  after  admission,  and 
subsequently  the  by-laws  were  changed  so  as  to  extend  the  limit  to 
five  years,  and  thereafter  the  member  committed  suicide,  the 
amended  by-law  was  binding  upon  the  member. 

Chambers  vs.  Supreme  Tent,  Knights  of  the  Maccabees,  July,  1901, 
200  Pa.  St.  244. 

Corporation — Right  to  Hold  Meeting  Outside  of  State  of  Charter. 

The  rule  that  a  cor^joration  must  perform  its  corporate  acts  within 
the  state  of  sovereignty  that  gave  it  life  does  not  apply  to  the  action 
of  a  benefit  society  incorporated  in  Pennsylvania  and  having  sub- 
ordinate councils  and  members  throughout  the  United  States,  in 
levying  a  per  capita  tax  on  its  members  at  a  corporate  meeting 
held  outside  of  the  limits  of  Pennslyvania.  such  an  act  being  within 


THE     STATE     OF     PENNSYLVANIA  843 

the  corporate  powers  and  necessary  to  jtrovide  revenue  upon  which 
the  existence  of  the  corporation  depended. 

Derry  Council  vs.  State  Council,  Oct.,  1900,  197  Pa.  St.  413. 

Beneficiary  After  Interest  Vests  is  a  Society  Creditor. 

A  beneficiary  named  in  a  contract  between  a  member  and  a  society 
becomes  after  the  death  of  the  member  a  creditor  of  the  society. 

Soils  vs.  Blank,  May,  1901,  199  Pa.  St.  GOn. 

Warranty  as  to  Age  Must  be  Literally  Kept. 

Where  an   applicant  for  membei-ship  stipulates  for  the  absolute 
truth  of  the  statements  made  in  his  application,  and  makes  a  state- 
ment as  to  his  age  which  is  in  fact  false,  the  benefit  certificate  is  . 
thereby  rendered  void  aiul  it  is  immaterial  whether  the  statement 
was  intentionally  and  wilfully  false. 

Dinan  vs.  Supreme  Council,  Cath.  Mut.  Benefit  Assn.,  Jan.,  1902,  201 
Pa.  St,  363. 

Creditors,  Rights  of  Local  Versus  Foreign. 

The  Pennsylvania  holders  of  matured  death  certificates  of  an  in- 
solvent society  are  entitled  to  payment  out  of  a  fund  belonging  to 
the  societ.y  in  Pennsylvania,  and  in  the  hands  of  an  ancillary  receiver 
in  the  State,  before  the  fund  or  any  part  of  it  is  handed  over  to  a 
receiver  of  the  society  ap])ointed  in  the  State  of  its  domicile.  Such 
holders  are  business  creditors  of  the  association  and  not  merely  rep- 
resentatives of  deceased  members. 

Fi-owert  vs.  Blank,  April,  1903,  205  Pa.  St.  299. 

Warranty  as  to  Age — Evidence  for  Jury. 

In  an  action  against  a  society  to  recover  a  death  benefit,  where 
the  defense  is  that  the  member  was  over  fifty  years  of  age  when 
he  was  initiated,  which  was  beyond  the  age  limit  permitted  by  the 


844  FRATERNAL    SOCIETY    LAW 

constitution  of  the  socii'ty,  and  the  evidence  on  the  subject  is  con- 
flicting- and  largely  tui"us  upon  the  credibility  of  the  witnesses,  the 
case  must  be  submitted  to  the  jury  for  determination. 

Dinan  vs.  Supreme  Council,  Cath.  Mut.  Benefit  Assn.,  Dec.  1904,  210 
Pa.  St.  456. 

Copies  of  Application  to  be  Attached  to  Contract. 

It  is  the  duty  of  an  insurance  company  to  attach  a  copy  of  the 
application  and  by-laws  to  a  policy  of  insurance,  and  unless  it  is 
attached  they  are  not  a  part  of  the  contract  of  insurance  and  are 
not  evidence  on  tlie  jiart  of  the  company  in  an  action  by  the  benefi- 
ciary on  the  contract,  nor  in  an  action  by  the  company  to  enforce 
against  the  insured  the  payments  of  assessments  levied  in  pursuance 
of  their  provisions. 

Custer  vs.  Fidelity  Mut,  Aid  Assn.,  March,  1905.  211  Pa.  St.  257. 

Warranty  as  to  Age,  Evidence  Under. 

In  an  action  against  a  society  to  recover  a  death  benefit  where 
the  defense  is  that  the  member  was  over  fifty  years  of  age  when  he 
was  initiated,  which  was  beyond  the  age  limit  permitted  by  the  con- 
stitution, and  there  is  oft'ered  in  evidence  a  statement  by  the  de- 
ceased, under  oath,  made  in  naturalization  proceedings,  showing 
that  the  deceased  at  the  time  of  his  initiation  was  over  fifty-six 
years  of  age,  and  this  evidence  is  unimpeaehed,  a  verdict  should  be 
directed  in  favor  of  the  society, 

Dinan  vs.  Supreme  Council,  Cath.  Mutual  Benefit  Assn.,  Jan.,  1906, 
213  Pa.  St.  4S9. 

Beneficiary — "Heirs  at  Law." 

Where  a  foreign  .society  was  chartered  for  the  nnitual  ]irotection 
and  relief  of  the  members,  and  for  payment  of  stipulated  stims  of 
money  to  the  family  or  heirs  of  deceased  members  of  siich  society, 
and  the  certificate  is  issued  payable  to  the  member's  legal  repre- 


THE    STATE    OF    PENNSYLVANIA  845 

sentatives,  it  is  held  that  the  death  benefits  are  payable  upon  the 
member's  death  to  his  heirs  at  law,  although  he  may,  by  will,  have 
given  such  benefits  to  certain  designated  relatives. 

Harton's  Estate,  Jan.,  1906,  213  Pa.  St,  499. 

Material  Fact,  What  is? 

A  fact  is  material  to  the  risk  when,  if  known  to  the  insurer,  it 
would  luive  caused  him  to  refuse  the  risk,  or  would  have  been  a 
reason  for  his  demanding  a  higher  premium. 

McCaffrey  vs.  Knights  &  Ladies  of  Columbia,  Jan.,  1906,  213  Pa.  St. 
609. 

Statute  of  Limitations,  When  it  Begins  to  Run. 

The  statute  of  limitations  begins  to  run  in  favor  of  a  member 
against  liis  liability  to  pay  an  assessment  to  a  receiver  of  a  society 
from  the  date  of  the  decree  of  court  authorizing  the  assessment,  and 
not  from  the  date  of  tlie  declared  insolvency  of  the  society. 

Schofield  vs.  Turner,  Jan.,  1906.  213  Pa.  St.  548. 

Warranty — Knowledge  of  Agent  as  to  False  Statements  Under,  Not 
Admissible. 

In  an  action  where"  the  defense  was  misrepresentation,  it  was 
claimed  that  the  agent  had  inserted  false  answers  in  the  application. 
Upon  this  point  the  Court  said: 

"Her  application  was  in  writing,  was  signed  by  her,  and  it  was 
the  basis  upon  which  the  contract  of  insurance  was  issued.  This 
suit  was  brought  upon  the  policy,  and  upon  the  application  as  part 
thereof,  without  any  averment  in  the  declaration  that  any  fraud 
or  mistake  was  committed  in  making  out  the  application.  If  the 
evidence  offered  tended  to  prove  anything  it  would  be  fraud  or 
misconduct  on  the  part  of  the  agent  in  inducing  applicant  to  sign 
a  statement  contrary  to  the  truth,  but  there  is  no  such  averment  in 
the  declaration.    The  application  for  the  policy,  by  its  plain  terms. 


846  FRATERXAL    SOCIETY    LAW 

brought  to  the  assured  distinct  notice  of  a  limitation  upon  the  power 
and  authorit.y  of  the  agent  in  that  it  contained  an  explicit  agree- 
ment that  no  statement  or  declaration  made  to  any  agent,  examiner, 
or  any  other  person,  and  not  contained  in  the  application,  should  be 
considered  as  having  been  made  to  or  brought  to  the  notice  of  the 
company,  or  as  charging  it  with  any  liability  by  reason  thereof 
*  *  *  Good  faith  required  of  her  correct  answers  to  the  questions 
and  reasonable  diligence  to  see  that  the  answers  were  correctly 
written.  If  it  be  assumed  that  the  answers  were  falsified  as  alleged, 
that  fact  would  at  once  appear  when  the  policy  was  delivered  to  her, 
by  the  copy  of  the  application  attached  to  it.  Inspection  would 
have  shown  that  a  fraud  had  been  committed  both  upon  her  and 
the  company,  and  it  would  have  been  her  plain  duty  to  make  the 
facts  known  to  the  company.  She  had  it  within  her  power  to  pre- 
vent the  fraud,  as  knowledge  of  it  was  within  her  reach.  Neither 
she  nor  her  beneficiary  can  be  permitted  to  take  the  fruits  of  the 
misrepresentation. ' ' 

Rinker  vs.  Aetna  Life  Ins.  Co.,  April,  1906,  214  Pa.  St,  COS. 

Beneficiaries — Children  by  Difi'erent  Wives. 

A  widower  with  six  children  married  a  widow  with  one  child  and 
had  by  her  two  children.     After  his  marriage  he  made  a  contract 
of  insurance  payable  to  his  wife  in  trust  for  herself  and  their  chil 
dren.     Held,  That  the  children  by  the  first  wife  were  entitled  to 
share  in  the  proceeds  of  the  contract. 

Lehman  vs.  Lehman,  May,  1906,  215  Pa.  St.  344. 

Forfeiture — Self-executing  Provisions  for  Valid. 

Where  the  by-laws  provide  that  each  member  shall  pay  the 
amount  according  to  age,  as  per  table,  and  that  any  member  failing 
to  pay  same  before  the  last  meeting  night  of  each  month  will  stand 
suspended  from  the  society  and  all  benetits  therefrom,  payment  by 
cash  mailed  on  the  last  day  of  the  month,  but  not  received  by  the 
society  until  the  following  day,  is  not  a  payment  within  the  meaning 
of  the  by-law,   and  failure  to  make  the  payment  within  the  time 


THE    STATE    OF    PENNSYLVANIA  847 

prescribed,  works  suspension  of  th^'  nuMiiber  without  any  action  on 
the  part  of  the  society. 

Beeman  vs.  Supreme  Lodge,  Shield  of  Honor,  June,  1906,  215  Pa.  St. 
627. 

Eesort  to  Courts,  Member  Must  Exhaust  Remedies  in  Society  Before 
He  Has  a  Right  to. 

Where  the  laws  of  a  society  provide  that  in  case  of  a  dispute 
about  suspension  or  expulsion,  no  suit  shall  be  brou^dit  against  the 
society  until  the  remedies  and  means  of  redress  provided  by  the 
society  shall  be  exhausted,  a  beneficiary  cannot  maintain  a  suit 
against  a  society  where  it  appears  that  neither  the  member  nor  the 
beneficiary  sought  in  an.y  way  to  avail  himself  of  the  remedies  and 
means  of  redress  itrovided  by  the  society.  Such  laws  are  binding 
upon  the  society  and  its  members. 

Beeman  vs.  Supreme  Lodge,  Shield  of  Honor,  June,  1906,  215  Pa.  St. 
627. 

Warranty,  Breach  of,  Evidence  Under. 

In  an  action  upon  a  certificate  where  the  defendant  sets  up  false 
representations  by  the  member  as  to  his  health,  and  there  is  evi- 
dence tending  to  show  that  the  applicant  was  afflicted  with  a  linger- 
ing and  progressive  disease  at  the  time  when  the  application  was 
made,  it  is  proper  to  admit  in  connection  therewith  evidence  of  the 
continuance  of  the  same  disease  afterw;ards  until  death,  and  also 
proper  to  admit  in  evidence  declarations  made  by  the  applicant  prior 
to  the  date  of  the  certificate  as  to  suffering  from  a  disease  which  he 
denied  ever  having  had  when  making  application  for  membership. 

Nophsker  vs.  Supreme  Council.  Royal  Arcanum,  June,  1906,  215  Pa. 
St.  631. 

Suicide,  Proofs  of  Death  Prima  Facie  Evidence  of. 

In  an  action  on  a  contract  where  the  company  sets  up  as  a  de- 
fense that  the  deceased  committed  suicide  within  two  years  from 


848  FRATERNAL    SOCIETY    LAW 

the  date  of  the  contract  in  violation  of  its  terms,  proofs  of  death  are 
admissable  as  prima  facie  evidence  of  suicide  where  such  proofs 
show  that  the  cause  of  death  was  suicide,  but  they  are  not  con- 
clusive upon  that  question. 

Felix  vs.  Fidelity  Mut.  Life  Ins.  Co.,  June,  1906,  216  Pa.  St.  95. 

Suicide — Facts  Sufficient  to  Establish. 

In  an  action  on  a  contract  the  society  set  up  suicide  as  a  defense. 
The  coroner  was  called  and  testified  that  he  found  the  deceased 
sitting  in  his  ofSce  chair  with  the  top  of  his  head  blown  off,  his  arms 
down,  and  a  shotgun  resting  between  his  legs,  with  a  loop  of  twine 
through  the  trigger-guard  around  his  right  foot.  This  testimony 
was  not  contradicted  and  it  was  held  sufficient  to  justify  a  verdict 
of  suicide. 

Felix  vs.  Fidelity  Mut.  Life  Ins.  Co.,  June,  1906,  216  Pa.  St.  95. 

Beneficiary — Daughter  Versus  Brother  of  Member. 

Where  a  society  has  paid  the  fund  into  court  and  a  contest  has 
arisen  between  a  minor  daughter  of  the  deceased  member  and  a 
brother  of  the  member,  judgment  for  the  daughter  will  be  sustained 
where  it  appears  that  the  mother  of  the  daughter  was  originally 
named  the  beneficiary;  that  she  was  given  the  certificate  by  her  hus- 
band with  the  assurance  that  he  would  never  change  it,  and  that 
the  wife,  relying  upon  this  assurance,  paid  out  of  her  separate 
estate  the  assessments  and  charges  upon  the  certificate  until  the 
time  when,  without  her  knowledge  or  consent,  her  husband  sur- 
rendered it  to  the  societ.v  for  a  new  certificate  in  which  his  brother 
was  substituted  as  a  beneficiary. 

King    vs.    Supreme   Council,   Catli.    Mut.    Benefit    Assn.,    Jan.,    1907, 
216  Pa.  St.  553. 

Custom — What  is. 

In  order  to  establish  the  validity  of  a  custom  or  usage,  it  must 


THE    STATE    OF    PENNSYLVANIA  Si9 

have  existed  so  long  as  to  become  generiiUy  known,  and  it  must  be 
clearly  and  distinctly  proved. 

Lockney  vs.  Police  Beneficiary  Assn.,  April,  1907,  217  Pa.  St.  568. 
54 


850  FRATERNAL    SOCIETY   LAW 


THE 

STATE  OF  RHODE  ISLAND. 

CHAPTER  40. 

The  Insurance  Commissioner  for  the  State  of  Rhode  Island  has 
issued  a  pamphlet  containing  a  synopsis  of  the  insurance  laws  of 
the  State,  etc.,  and  from  it  Ave  quote  the  following: 

"Fraternal  Beneficiary  Associations. 

"Fraternal  beneficiary  associations  operating  upon  the  lodge  sys- 
tem and  not  employing  paid  agents  are  exempt  from  State  super- 
vision. The  only  legal  requirement  affecting  this  class  of  companies 
is  that  they  file  with  the  Secretary  of  State  a  power  of  attorney 
authorizing  some  person  who  is  a  resident  of  the  State  to  accept  all 
service  of  process  in  legal  proceedings." 

The  court  decisions  affecting  Fraternal  Societies  are  the  following 
eases : 

Agency — Authority  of  Collector. 

The  presumptive  authority  of  a  collector  is  much  slighter  than 
that  of  one  who  receives  applications  for  insurance  and  delivers 
contracts. 

Bryan  vs.  National  Life  Ins.  Assn.,  Jan.  1899,  21  R.  I.  149. 

Agency — Waiver  and  Estoppel. 

A  contract  having  lapsed  on  the  15th  of  the  month  by  reason  of 
non-payment  of  an  assessment  due  on  that  day.  a  collector  after- 


THE    .STATE    OF    RHODE    ISLAND  851 

wards  called  at  the  liouse  of  tin-  insni-c(l  and,  not  reooiving  the  pay- 
ment, ]>i-oiiiised  to  call  again.  Held,  that  this  did  not  amount  to  a 
waiver  or  an  estoppel. 

Bryan  vs.  National  Life  Ins.  Assn.,  .Tan.  1899,  21  R.  I.  149. 

Assessments,  Members  Presumed  to  Know  Rights  Under. 

The  form  of  insurance  under  the  plan  of  beneficial  associations, 
based  upon  assessments  as  distinguished  from  fixed  premiums,  is 
now  so  common  that  the  court  is  bound  to  take  notice  of  the  char- 
acter and  efi'eet  of  such  plan  and  to  presume  that  members  of  such 
associations  know  that  their  cei-tifieates  are  not  absolute  ])romises, 
but  conditional  upon  the  amounts  received  from  assessments. 

Newton  vs.  Northern  Mut.  Relief  Assn.,  Nov,  1899,  21  R,  I.  476, 

Agent,  When  Not  Personally  Liable. 

An  action  will  not  lie  against  an  agent  of  a  society  in  favor  of  a 
member  for  wrongfully  refusing  to  comply  with  the  by-laws  relative 
to  obtaining  sick  benefits  by  such  member.  The  remedy  of  the  mem- 
ber is  against  the  societv. 

Gleavy  vs.  Walker,  April,  1900,  22  R.  I.  70. 

Beneficiary — Insurable  Interest. 

The  question  of  insurable  interest  can  only  be  raised  b.v  the  in- 
surer, and  where  the  latter  pays  the  fund  into  court  under  a  bill  of 
interpleader,  the  question  is  removed. 

John  Hancock  Mut.  Life  Ins.  Co.  vs.  Lav.-cier,  Feb.  1901,  22  R.  L  416. 

Contract,  Medical  Examination  Not  Part  of. 

The  answers  of  a  medical  examiner  made  to  questions  propounded 
to  him  and  answered  by  him  in  connection  with  an  application  for 
a  contract  of  insurance,  which  medical  examination  is  not  signed 


852  FRATERNAL    SOCIETY    LAW 

by  the  applicant,  are  not  to  be  considered  a  part  of  the  application 
nor  of  the  contract  made  with  the  applicant. 

Leonard  vs.  New  England  Mut.  Life  Ins.  Co.,  March,  1901.  22  R.  I.  519. 

Incontestable  Clause,  Extent  of. 

The  insurer  is  bound  by  a  provision  in  the  contract  which  reads: 
"This  policy  shall  l)e  incontestable  after  two  years  from  the  date 
of  its  i.ssue,  provided  the  prennums  are  paid  as  agreed,"  and  is  pre- 
cluded from  setting-  up  a  defense  based  upon  false  and  fraudulent 
answers  made  by  the  insured  in  his  application. 

Murray  vs.  State  Mut.  Life  Ass'n  Co.,  Marcli,  1901,  22  R.  I.  524. 

Agency  of  Medical  Examiner  That  of  Society. 

Where  the  rules  of  the  company  required  the  medical  examiner 
to  put  the  questions  and  fill  out  the  answers  in  his  own  handwriting, 
he  was  in  this  respect  the  agent  of  the  company,  and  if  he  received 
correct  answers  and  took  the  signature  of  the  applicant  before  the 
answers  were  recorded,  this  must  be  regarded  as  the  action  of  the 
company,  and  not  within  the  rule  that  the  writer  of  the  application 
is  the  agent  of  the  insured. 

Leonard  vs.  State  Mut.  Life  Assurance  Co.,  March,  1902,  24  R.  I.  7. 

Agency  of  Medical  Examiner  Limited. 

A  medical  examiner  required  to  iill  out  a  medical  certificate  is  not 
the  agent  of  the  company  for  anything  more  than  the  certificate. 
Notice  to  him  of  anything  not  called  for  by  the  certificate  is  not 
notice  to  the  company.  He  is  without  authority  to  waive  answers 
or  to  give  advice  binding  on  the  company. 

Leonard  vs.  State  Mut.  Lite  Assurance  Co.,  March,  1902,  24  R.  t.  7. 

Warranty — Falsity  of  the  Answers  and  Not  Fraud  the  Test. 

Under  the  rule  making  the  answers  of  an  insured  warranties,  the 


TBE    STATE    OF   RHODE    ISLAND  853 

falsity  of  the  answers  and  not  the  fraud  of  tho  insurod  is  tlie  test. 
Leonard  vs.  State  Miit.  Life  Assurance  Co.,  March,  1902,  24  R.  I,  7. 

Contract — When  Agreement  for  is  Merged  Into. 

A  deceased  member  of  a  local  society,  with  other  members,  became 
a  member  of  a  national  society,  and  in  his  application  for  benefits 
in  the  latter  he  released  all  his  mortuary  benefits  in  the  former. 
This  was  in  pursuance  of  an  agreement  by  which  the  local  society 
was  to  pay  the  entry  fees  of  such  of  its  members  as  joined  the 
national  society.  While  the  transfer  was  only  partly  consummated, 
ami  before  any  certificate  was  issued  on  the  application  of  the  de- 
ceased, he  died,  and  the  national  society,  claiming  that  the  deceased 
was  not  entitled  to  mortuary  benefits  in  both  societies,  proposed  to 
pay  the  widow  the  sum  v.-hich  would  have  accrued  to  the  member's 
representative  if  he  had  fully  completed  his  membership,  if  she 
would  assign  to  the  national  society  her  claim  for  benefits  in  the 
local  society,  which  she  did.  The  widow  later  claimed  benefits  in 
both  societies,  and  on  interpleader  it  was  held  that  the  terms  of  the 
application  substituted  one  right  for  the  other,  and  that  the  local 
society  was  entitled  to  the  fund. 

L'Union  St.  Jean  Baptiste  vs.  Salomie  Couture.  July,  1902,  24  R.   L 
304. 

Members  Responsible  for  Acts  of  Society. 

The  individual  members  of  voluntary  societies  are  liable  for  all 
acts  of  the  society  which  are  done  within  the  scope  of  its  authority, 
although  they  may  be  absent  from  the  meeting  at  the  time  when 
such  action  is  taken. 

McDermott  v.  St.  Wilhelmina  Benev.  Society,  Dec,  1902,  24  R.  I.  527. 

Expulsion,  Member  Entitled  to  Notice  of  Charges  Before. 

While  a  member  of  a  society  is  entitled  to  notice  of  charges  and 
opportunity    for    defense,    which    includes    a    specification    of    the 


854  FRATERNAL    SOCIETY    LAW 

charges  against  which  he  is  to  defend,  yet  when  he  has  actual  notice 
of  the  particular  charge,  he  has  all  that  he  can  claim,  even  though 
it  may  not  be  formally  stated. 

Pepin  vs.  Societe  St.  Jean  Baptiste,  Dec,  1902,  24  R.  I.  550, 

Assessments  Are  Not  Recoverable  Against  Members. 

The  assessments  in  a  fraternal  society  are  not  to  be  regarded  as 
debts  recoverable  at  law. 

L'Union  St.  Jean  Baptiste  vs.  Ostiguy,  Nov.,  1903,  25  R,  I,  47S. 

Beneficiaries — Where  Failure  of. 

The  by-laws  of  a  society  provided  that  upon  the  death  of  a  mem- 
ber the  amount  insured  should  be  paid  one-half  to  the  widow  or 
husband  and  one-half  to  the  children,  or,  if  there  be  no  children, 
the  whole  to  the  widow  or  husband,  or,  if  no  widow  or  husband, 
then  to  the  next  of  kin.  The  deceased  member  left  neither  widow 
nor  children,  nor,  so  far  as  known,  any  next  of  kin.  It  was  held  that 
the  fund  did  not  go  to  the  executrix  as  part  of  the  member's  estate. 

Gould  vs.  United  Traction  Employes'  Aid  Assn.,  April,  1904,  26  R.  I. 
142. 

Expulsion — An  Incident  to  the  Usual  Powers  of  Societies. 

The  power  of  expulsion  iu  a  fraternal  society  is  included  in  what 
may  be  denominated  its  police  power,  and  the  corporation  may  right- 
fully establish  by-laws  providing  for  the  expulsion  of  members  who 
transgress  their  reasonable  pruvisioiis.  ^Members  who  were  expelled 
for  .the  publicatioji  of  an  article  in  a  new.spaper,  which  article  is 
defamatorj-  and  holds  the  society,  and  its  officers  up  to  ridicule, 
were  guilty  of  such  conduct  as  to  warrant  their  expulsion. 

Del  Ponte  vs.  Societa  Italiana,  Jan.,  1905,  27  R.  I.  1, 

Resort  to  Civil  Court,  Right  of  in  Members. 

A  tribunal  which  has  questionable  authority  to  settle  disputes, 


TBE    STATE    OF   RHODE    ISLAND  855 

or  which  has  only  a  limited  authority,  and  which  assumes  to  itself 
power  to  discipline  members  without  any  express  prdvisions  in  the 
law  therefor,  cannot  be  held  to  have  exclusive  jurisdiction,  and  the 
action  of  such  tribunal  need  not  be  appealed  from  in  the  absence  of 
express  provison  for  such  appeal,  and  aggrieved  members  may  with- 
out proceeding  further  resort  to  the  civil  courts  for  remedy. 

Moeller  vs.  Machine  Printers'  Beneficial  Assn.,  Feb.,  190.5,  27  R.  I.  22. 

Representations,  Materality  of,  Act  Respecting  Not  Retroactive. 

The  provisions  of  the  public  law  of  1902  providing  that  no  mis- 
statement made  in  procuring  a  contract  of  life  insurance  shall  be 
deemed  material  or  render  the  cimtract  void  unless  the  matter  thus 
represented  shall  actually  have  contributed  to  the  contingency  or 
event  on  which  the  contract  is  to  become  due  and  payable ;  and 
whether  the  matter  so  represented  contributed  to  said  contingency 
or  event  in  any  case  is  a  question  for  the  jury,  has  no  application  to 
contracts  existing  at  the  time  of  the  passage  of  said  act. 

Leonard  vs.  State  Mut.  Life  Assurance  Co.,  April,  1905,  27  R.  I.  121. 

Limitations,  Statute  of  in  Societies  Valid. 

The  provisions  in  a  contract  providing  that  no  suit  shall  be  main- 
tained unless  brought  within  two  years  after  the  maturity'  of  the 
claim,  is  held  valid. 

Wilkinson  vs.  John  Hancock  Mut.  Life  Ins.  Co.,  May,  1905,  27  R.  I. 
146. 

Estoppel — Definition  of. 

Waiver  is  not  in  the  proper  sense  a  species  of  estoppel,  unless  the 
conduct  of  one  party  has  induced  the  other  to  take  such  a  position 
that  he  will  be  injured  if  the  first  party  is  permitted  to  repudiate  his 
acts. 

Dary  vs.  Providence  Police  Assn.,  Nov.,  1905,  27  R.  I.  377. 


856  FRATERNAL    SOCIETY   LAW 

Interest,  When  Proper  to  Allow. 

Interest  is  allowable  though  not  stipulated  for,  as  an  invariable 
legal  incident  to  a  principal  debt  from  the  date  of  default,  when- 
ever the  debtor  knows  precisely  what  he  is  to  pay  and  when  he  is 
to  pay  it;  but  a  beneficial  association  ought  not  to  be  treated  as  a 
delinquent  debtor  before  demand  made  upon  it,  followed  by  its 
refusal  or  neglect.  While  demand  was  unnecessai-y  in  the  circum- 
stances of  the  case  for  the  purpose  of  keeping  the  claim  alive,  it  was 
necessary  for  the  purpose  of  creating  the  relation  of  debtor  and 
creditor. 

Dary  vs.  Providence  Police  Assn.,  Nov.,  1905,  27  R.  I.  377. 

Resort  to  Civil  Courts  Permissible. 

A  by-law  of  a  fraternal  benefit  society  which  requires  every  con- 
testation between  the  society  and  members  to  be  referred  to  and 
decided  by  a  committee  of  five  persons,  whose  decision  shall  be  final, 
is  invalid  and  no  defense  to  an  action  brought  by  a  member  against 
the  society. 

Pepin  vs.  Societe  St.  Jean  Baptiste,  June,  1901.  23  R.  I.  SI. 

Courts,   When  Authorized   to  Interfere  With  Internal  Affairs  of 
Societies. 

Courts  will  not  interfere  with  the  by-laws  of  a  society  which  re- 
late simply  to  matters  of  internal  administration  or  discipline,  nor 
which  amount  to  a  condition  precedent  to  a  right  of  action,  but 
by-laws  whicli  deprive  a  person  of  his  remedy  at  law,  or  impose  con- 
ditions repugnant  to  the  recognized  rules  of  law  in  other  eases  of 
contracts,  are  invalid.     The  court  said : 

"At  first  sight  this  may  seem  to  interfere  with  the  obligatidu  of  a 
contract,  but  it  is  not  so.  All  the  elements  of  a  contract  affecting 
liability  remain,  the  agreement  to  arbitrate  relating  only  to  remedy. 
It  is  to  be  presumed  that  a  just  decision  will  be  reached  in  either 
case,  and  hence  neither  party  suffers  injury.  A  resort  to  the  courts 
may  lie  very  necessary  to  a  claimant,  because  he  cannot  compel  the 


THE    HTATE    OF   RHODE    ISLAND  857 

attendance  of  witnesses  before  a  voluntary  tribunal,  or  the  matter 
may  be  of  so  great  interest  to  the  members  as  to  preclude  impartial 
arbitrators.  The  society,  on  the  other  hand,  may  at  any  time,  if  it 
does  not  wish  to  arbitrate,  compel  a  claimant  to  resort  to  the  courts 
by  refusing  to  arbitrate  or  to  pay;  hence  the  obligation  is  not  mutual 
except  ill  theory." 

Pepin  vs.  Societe  St.  Jean  Baptiste,  June,  19011  23  R.  I.  81. 

By-laws,  Reasonable  Construction  to  Carry  Out  Meaning  Proper. 

A  by-law  of  a  fraternal  beneficiary  society  foi-bidding  a  sick  mem- 
ber to  go  out  of  the  house  after  certain  hours,  the  intent  of  the  by- 
law being  to  guard  against  fraud  in  feigning  sickness,  has  no  appli- 
cation where,  on  the  occasions  of  the  alleged  violation,  the  member 
attended  meetings  of  the  defendant  lodge. 

Gleavy  vs.  Court  Love  and  Truth,  June,  1901.  23  R.  I.  85. 

Liability  for  Benefits,  When  Begins. 

"Where  a  by-la^  provides  that  sick  pay  shall  not  commence  until 
the  secretary  has  received  a  certificate  signed  by  the  physician  of 
the  society  stating  the  member's  illness,  after  the  physician  is  noti- 
fied of  such  illness,  the  matter  of  putting  the  member  on  the  sick 
list  is  the  act  of  the  society  and  not  of  the  member. 

Gleavy  vs.  Court  Love  and  Truth,  June,  1901,  23  R.  L  85. 

Receivership — No  Assessments  for  Subsequent  Losses. 

The  losses  of  an  insurance  company  sustained  after  the  appoint- 
ment of  a  receiver  are  not  to  be  provided  for  by  assessment  on  the 
remaining  contracts,  such  an  appointment  of  a  receiver  being  a  dis- 
solution of  the  company,  and  its  contracts  are  to  be  treated  as  ter- 
minated by  operation  of  law. 

Insurance   Commissioner   vs.   Commercial   Mutual   Ins.   Co.,   March, 
H  1897,  20  R.  I.  7. 


I 


i 


858  FRATERNAL    SOCIETY   LAW 

Waivers,  True  Rule  as  to. 

The  general  rule  that  the  acceptance  by  an  insurance  company 
of  the  premium  after  full  knowledge  of  the  violation  of  the  condi- 
tions of  the  policy  is  a  waiver  of  any  forfeiture  because  of  such 
violation,  applies  to  all  causes  of  forfeiture. 

Milkman  vs.  United  Mut.  Ins.  Co.,  March,  1897,  20  R.  I.  10. 

Beneficiary — Change  of^ — Negligence  of  Society  No  Bar. 

The  assured  in  a  contract  of  insurance  had  reserved  the  right  to 
change  the  beneficiary  with  the  consent  of  the  society,  and  had  exer- 
cised this  right  and  forwarded  the  proper  paper  to  the  society's 
ofSce.  The  member  died  before  the  society  had  consented  or  refused 
to  consent  to  the  change;  the  delay  being  due  to  the  negligence  of 
the  societj'.  Held,  that  the  new  beneficiary  named  in  the  application 
for  change  of  beneficiary  was  entitled  to  the  fund. 

John  Hancock  Mut.  Life  Ins.  Co.  vs.  White,  April,  1898,  20  R.  I.  457. 


THE  STATE  OF  SOUTH  CAROLINA  859 


h 


THE 

STATE  OF  SOUTH  CAROLINA. 


CHAPTER  41. 

The  State  of  South  Carolina  has  no  statute  law  applicable  to  Fra- 
ternal Societies.  Such  decisions  of  the  Supreme  Court  of  this  State 
as  affect  questions  of  Fraternal  Society  Law  are  digested  as  follows: 

Beneficiary — Insurable  Interest. 

An  assignment  of  an  insurance  contract  valid  in  its  inception 
remains  so,  and  the  person  may  insure  his  own  life  for  the  benefit  of 
one  who  has  no  insurable  interest  in  his  life,  if  the  transaction  is  not 
a  cover  to  evade  the  law  against  wagering  contracts. 

Crosswell  vs.  Conn.  Indemnity  Assn.,  April,  1S97,  51  S.  C.  103. 
Assessments — Forfeiture  for  Failure  to  Pay. 

A  mutual  insurance  company  whose  by-laws  are  made  part  of 
the  contract,  and  A^hich  provides  that  a  contract  is  void  on  failure 
to  pay  an  as.sessment  within  thirty  days  after  notice,  is  not  liable  on 
such  contract  after  the  assessments  become  past  due,  and  remain 
unpaid. 

Joye  vs.  South  Carolina  Mut.  Ins.  Co.,  Nov.,  189S.  54  S.  C.  371. 
Denial  of  Liability — When  Not  Waived  by  Compromise  of  Claim. 

The  adjustment  and  compromise  of  a  loss  is  not  a  waiver  of  the 
right  to  deny  liability  where  the  settlement  papers  state  that  such 
ad.iustment  shall  not  be  considered  such  waiver. 

Joye  vs.  South  Carolina  Mut.  Ins.  Co..  Nov  .  1S9S.  54  S.  C    371. 


860  FRATERNAL   SOCIETY   LAW 

Ownership  in  Property  and  Funds  After  Forfeiture  of  Charter. 

If  an  incorporated  society  permits  its  charter  to  expire  but  keeps 
up  its  organization  and  work,  the  individual  members  become  the 
owners  of  its  property  and  funds. 

Stemmermann  vs.  Lilienthal.  Nov.,  1898,  54  S.  C.  440. 

Voluntary  Societies — Who  May  Sue. 

The  right  of  action  for  obligations  due  a  voluntary  association  is 
in  the  members,  or  the  officers  as  the  agents  of  the  members,  and 
several  members  of  such  an  association  may  bring  an  action  against 
a  defaulting  trea-surer  and  his  sureties  for  the  benefit  of  all. 

Stemmermann  vs.  Lilienthal,  Nov..  1898,  54  S.  C.  440. 

Denial  of  Liability  Waives  Proofs  of  Loss. 

A  denial  of  liability  under  a  contract  waives  the  right  to  proofs 
of  loss  as  required  by  the  contract. 

Wilson   vs.   Commercial   Union   Assurance   Company,  Nov.,   1897,  51 
S.  C.  540. 

Waiver,  Doctrine  of,  Applicable  to  Societies. 

The  doctrine  of  waiver  as  applied  to  old  line  insurance  companies 
also  applies  to  mutual  insurance  companies,  antl  failure  of  the  com- 
pany to  request  further  proof  of  loss,  and  contesting  claim  of  loss  on 
its  merits,  is  a  waiver  of  the  right  to  object  to  the  form  of  the  proofs 
of  loss. 

McBryde  vs.  South  Carolina  Mut.  Ins.  Co.,  April,  1899,  55  S.  0.  589. 

Fraternal  Societies  Governed  by  General  Rules  of  Waiver. 

Mutual  insurance  companies  and  fraternal  benefit  societies  are 
governed  by  the  same  rules  of  law  as  to  waiver  as  old  line  insurance 
companies. 


THE  STATE  OF  SOUTH   CAROLINA  861 

Sparkman  vs.   Supreme  Council   Am.   Legion   of   Honor,  Nov.,   1899, 
57  S.  C.  16. 

Agency  Not  Shown  by  Declarations  of  Agent. 

Agency  cannot  be  shown  by  the  declarations  of  the  agent.  The 
society  may,  before  the  delivery  of  its  contract,  waive  a  condition 
precedeiit  which  is  solely  for  its  benefit. 

Going  vs.  Mut.  Benefit  Life  Ins.  Co.,  April,  1900,  58  S.  C.  201. 

Forfeitures,  Must  be  Pleaded  Specially. 

Where  a  comjilaint  alleges  that  all  conditions  of  the  contract  have 
been  performed,  and  the  answer  is  merely  a  denial  of  the  allegations 
of  the  complaint,  the  society  will  not  be  permitted  to  prove  condi- 
tions of  forfeiture,  and  if  same  are  to  be  relied  upon  they  must  be 
specifically  alleged. 

Pickett,  Receiver  vs.  Fidelity  &  Casualty  Co.,  Nov.,  1900,  60  S.  C.  477. 

Misrepresentation — What  Must  be  Regarded  as  Fraudulent. 

Statements  made  by  an  applicant  to  an  examining  physician,  or 
matters  concealed  by  the  ajsplicant  for  the  evident  purpose  of  in- 
ducing the  society  to  accept  him.  must  be  regarded  as  a  fraud 
practiced  upon  the  society. 

Drakeford   vs.   Supreme   Conclave,    Knights   of    Damon.   April.   1901, 
61  S.  C.  338. 

Intemperate  Habits,  What  is,  a  Question  of  Law. 

Whether  the  occasional  use  of  intoxicating  liquors  or  an  occasional 
case  of  excess  in  such  use,  renders  a  person  of  intemperate  habits, 
is  a  question  of  law ;  but  it  is  for  the  jury  to  determine  whether  the 
use  or  excess  is  occasional  or  habitual  in  a  particular  case. 

Drakeford   vs.   Supreme   Conclave,   Knights   of   Damon,   April,   1901, 
61  S.  C.  338. 


862  FRATERNAL   SOCIETY   LAW 

Compromise — Will  Not  be  Set  Aside  Before  Tender  Back  of  Pay- 
ment Made. 

Where  the  insured  accepts  from  the  company  a  sum  less  than  the 
amount  called  for  in  the  contract  in  satisfaction  of  his  loss,  he  can- 
not afterwards  sue  the  company  for  the  balance  under  the  contract 
without  repaying  or  oifering  to  the  company  the  amount  so  paid, 
although  he  may  allege  the  amount  was  so  accepted  by  reason  of  the 
fraud  and  false  representation  of  the  defendant's  agent. 

Riggs  vs.  Home  Mut.  Protection  Assn..  April,  1901,  61  S.  C.  448. 

Suicide  Clause  Valid. 

A  clause  in  a  certificate  excepting  from  the  risk  assumed  a  mem- 
ber's death  by  his  own  hand  or  act,  whether  sane  or  insane,  is  not 
void  as  against  public  policy,  or  for  want  of  mutuality. 

Latimer  vs.   Sovereign   Camp,  Woodmen   of  the  World,  April,  1901, 
62  S.  C.  145. 

Suicide,  Sane  or  Insane,   Clause  Valid — Mental  Condition  Imma- 
terial. 

Under  a  suicide  clause  excepting  death  by  suicide,  whether  the 
member  be  sane  or  insane,  no  recovery  can  be  had  if  the  member 
suicided ;  and  whether  he  was  in  such  mental  condition  as  to  form  an 
intention  to  take  his  own  life  or  understand  the  effect  or  result  of 
his  act  or  not.  is  immaterial. 

Latimer  vs.   Sovereign   Camp.  Woodmen   ot  the  World.  April,   1901, 
62  S.  C.  14.5. 

Warranties — Limitations  Respecting. 

Statements  in  an  application  reading,  "I  adopt  as  my  own,  war- 
ranting them  to  be  true  and  complete,  statements  of  all  material 
facts  within  my  knOAvledge,"  are  held  as  simply  warranties  as  to 
the  truth  of  facts  within  the  applicant's  knowledge. 

Thompson  vs.  The  Family  Protective  Union,  April,  190.^,  66  S.  C.  459. 


THE  STATE  OF  SOUTH  CAROLINA  863 

Name  of  Society,  Changing  of,  Does  Not  Aifect  Right  of  Members. 

The  changing  oi'  tlic  name  of  a  corporation  does  not  cIimiikc  its 
liabilities  or  rights,  and  members  of  the  society  before  the  change 
in  name  are  members  afterwards. 

South  Carolina  Mut.  Ins.  Co.  vs.  Price,  April,  1903,  67  S.  C.  207. 

Agency  of  Local  Lodges  in  Initiating  Members — Society  Liable  for 
Damages  From. 

The  local  camps  of  the  Woodmen  of  the  World  are  agents  of  the 
Sovereign  Camp,  and  the  Sovereign  Camp  is  liable  for  injuries  in- 
flicted on  a  member  by  a  local  camp  in  initiating  him  by  means  of  a 
mechanical  goat,  although  such  contrivance  was  not  authorized  by 
the  Sovereign  Camp. 

Mitchell  vs.  Leech,  April,  1904,  69  S.  C.  413. 

Beneficiary — ' '  Wife  and  Heirs. ' ' 

An   insurance   contract  payable  to  "my  wife  and  heirs  of  my 

body,"  goes  to  the  widow  and  children  as  individuals  and  not  to  the 
personal  representative  of  the  deceased  member. 

Bramlett  vs.  Mathis,  Nov.,  1904,  71  S.  C.  123. 

Waiver — When  Facts  are  for  the  Jury. 

The  receipt  of  a  policy  by  the  local  agent  who  held  it  at  the  re- 
quest of  the  insured,  the  non-payment  of  the  premium  not  being  the 
cause  for  the  retention,  as  the  premium  had  been  proffered,  the  ten- 
der of  premium  after  illness,  and  again  after  death,  are  facts  from 
which  the  jury  might  infer  waiver  of  the  condition  in  the  applica- 
tion which  reads  that  "this  contract  shall  not  take  effect  until  the 
first  premium  has  been  paid  during  my  good  health." 

Dargan  vs.  Equitable  Life  Assurance  Society,  Nov,  1904,  71  S,  C,  356. 


I 


t 


864  FRATERNAL    SOCIETY    LAW 

Contract  When  Begins  and  Waiver  of  Provisions  by  Agent. 

The  provision  that  there  shall  be  no  contract  of  insurance  until 
the  application  is  accepted  by  the  home  office,  is  valid  and  binding, 
and  it  is  incompetent  to  admit  declarations  of  an  agent  that  the 
insurance  was  to  begin  from  the  date  of  the  receipt  of  the  premium. 

McGrath  vs.  Piedmont  Mut.  Ins.  Co.,  April,  1906,  74  S.  C.  69. 

Jurisdiction — Where  Suit  May  be  Brought. 

A  domestic  insurance  corporation  cannot  be  sued  in  a  county  in 
which  it  has  issued  a  contract,  unless  it  has  an  agent  in  such  county. 
The  jurisdiction  of  the  court  is  a  siibject  matter,  and  the  right  to 
change  of  venue  is  not  waived  by  answer  to  the  merits. 

Nixon  and  Danforth  vs.  Piedmont  Mut.  Ins.  Co.,  April,  1906.  "4  S.  0. 
438. 

Evidence — Parol  Agreement  Not  Admissible  to  Defeat  Term  of  Con- 
tract. 

Oral  evidence  as  to  the  agreement  between  the  parties  before  the 
execution  of  the  contract  is  inadmissible;  and  where  the  kind  of 
contract  is  not  delivered  that  was  agreed  to  be  delivered,  the  only 
damage  sustained  by  the  applicant  for  failure  to  deliver  the  con- 
tract desired,  is  the  value  of  the  advance  payment  made  by  him. 

Prince  vs.  State  Mut.  Life  Ins.  Co.,  Supreme  Ct.  of  S.  C.  June,  1907, 
57  S.  E.  766. 

Beneficiary — Rights  of  Wife. 

A  certificate  provided  for  the  payment  of  $3,000.00  on  the  death 
of  the  member  to  the  beneficiary  named  therein,  who  under  the 
by-laws  was  required  to  be  "wife,  children,  adopted  children,  par- 
ents, etc,"  with  the  proviso  that  if  the  member  outlived  the  bene- 
ficiary named  and  died  without  leaving  another  beneficiary,  the 
certificate  should  be  paid  to  the  member's  next  living  relations  in 
the  order  named.     A  member  named  his  wife  as  beneficiary,  and 


THE  STATE  OF  SOUTH  GAROLiyA  865 

she  died,  and  he  married  again  leaving  a  second  wife  without  having 
changed  his  beneficiary  in  the  certificate.  Held,  that  the  second 
wife  took  the  benefit. 

Speegle  vs.   Sovereign  Camp,  Woodmen  of  the  World,  Supreme  Ct. 
of  S.  C,  Aug.,  1907,  5S  S.  E.  435. 

Forfeiture — Reinstatement  of  Member. 

A  provision  in  a  certificate  to  the  effect  that  a  member's  being  in 
arrears  for  four  weeks  shall  render  the  certificate  void,  but  that 
the  same  may  be  reinstated  by  the  member's  paying  the  regular 
initiation  fee  and  presenting  the  certificate,  was  held  to  be  valid, 
and  that  a  member  in  arrears  t'diii-  weeks  for  dues,  forfeited  his 
certificate,  but  that  such  forfeiture  may  be  waived  by  the  society's 
accepting  dues  thereafter. 

Singleton  vs.  Progressive  Benefit  Assn.,  Supreme  Ct.  S.  C,  August, 
1907,  58  S.  E.  609. 

Resort  to  Civil  Court — When  Right  to. 

Where  a  society  denies  liability  on  a  contract  which  provides 
that  no  suit  shall  be  brought  thereon  until  the  assessment  has 
been  made,  and  the  society  refuses  to  make  an  assessment,  the  mem- 
ber may  sue  at  law  for  breach  of  contract  and  recover  the  amount 
he  would  have  been  entitled  to  if  the  company  had  made  an  assess- 
ment. 

Batson   vs.   Soutli  Carolina   Mut.    Ins.  Co..   Supreme  Ct.   S.  C,   Oct., 
1907,  58  S.  E.  936. 

Rules  of  Law  Applicable  to  Societies. 

Mutual  benefit  associations  are  generally  governed  by  the  same 

rules  of  law  as  old  line  insurance  companies. 

Morrison   vs.  Mut.   Benev.   Assn.,   Supreme  Ct.  S.   C,   Oct.,   1907,   59 
S.  E.  27. 
55 


866  FRATERNAL    SOCIETY   LAW 

Forfeiture — Applies  to  all  Members. 

The  laws  of  a  mutual, benefit  society  requiring  the  payment  of  dues 
provided  that  if  a  member  has  not  belonged  to  the  society  for  twelve 
mouths  he  is  only  required  to  pay  pro  rata,  and  that  any  member 
failing  to  pay  the  annual  dues  within  a  given  time  shall  be  dropped 
from  membership.  It  was  held  that  the  provision  for  forfeiture 
applied  as  well  to  members  joining  during  the  year  as  to  those  be- 
longing at  the  beginning  of  the  year. 

Morrison  vs.  Miit.  Benev.  Assn.,  Supreme  Ct.,  S.  C,  Oct.,  1907,  59 
S.  E.   27. 


THE    ^TATE    OF    SOUTH    DAKOTA  867 


thf: 
STATE  OF  SOUTH  DAKOTA. 

CHAPTER  42. 

The  State  of  South  Dakota  has  never  enacted  a  special  code  for 
Fraternal  Societies  but  they  come  under  Article  18.  Cluijjter  1  of  the 
Civil  Code  and  certain  other  i)rovisioiis  of  the  ^eueral  insurance 
laws  of  the  State  seem  to  apply  to  them.  The  folldwinu  sections  of 
said  article  18  are  pertinent: 

Section  706.  Every  corporation  or  association  organized  under 
the  laws  of  this  State  upon  the  mutual  assessment,  co-operative  or 
natural  premium  plan  for  the  purpose  of  insuring  the  lives  of  in- 
dividuals or  furnishing  benefits  to  the  widows,  heirs,  orphans  or  le,ga- 
tees  of  deceased  members,  or  furni.shing  accident  indemnity,  shall, 
before  commencing  business,  comply  with  the  provisions  of  this 
article. 

Section  707.  The  articles  of  incorporation  of  such  organization 
shall  show  the  plan  of  business,  and  shall  be  submitted  to  the  com- 
missioner of  insurance  and  attorney  general,  and  if  such  articles  are 
found  to  comply  with  the  provisions  of  this  article  they  shall  approve 
the  same.  When  said  articles  are  thus  approved  the.v  shall  be  re- 
.  corded  in  the  office  of  the  commissioner  of  insurance  of  the  State  of 
South  Dakota,  and  a  notice  published  as  provided  for  under  the  gen- 
eral laws  for  the  organization  of  fire  insurance  companies. 

Section  708.  No  corporation  or  association  organized  under  this 
act  shall  take  any  name  in  use  by  any  other  organization,  or  so 
closely  resembling  such  name  as  to  mislead  the  public  as  to  its 
identity. 


868  FRATERNAL    SOCIETY    LAW 

Section  709.  Each  assdeiation  organized  under  this  act  sliall,  be- 
fore issuing  any  policy  or  certificate  of  membership,  if  said  associa- 
tion has  not  the  membership  sufficient  to  pay  the  full  amount  of  the 
certificate  or  policy  on  an  assessment,  cause  the  application  for  insur- 
ance to  have  printed  in  red  ink  in  a  conspicuous  manner  aloiif;-  the 
margin  of  said  application  the  words  "it  is  luiderstood  and  agreed 
that  the  amount  to  be  paid  when  the  certificate  or  policy  ^issued  upon 
this  application  becomes  a  claim  shall  be  dependent  upon  the  amount 
collected  from  an  assessment  made  to  meet  such  claim,"  and  they 
must  have  actual  applications  on  at  least  two  hundred  and  fifty  in- 
dividual lives  for  at  least  one  thousand  dollars  each;  and  the  presi- 
dent, secretary  and  treasurer  of  such  corporation  or  association  shall 
file  with  the  commissioner  of  insurance  a  joint  bond  with  good  and 
sufficient  securities  in  the  sum  of  ten  thousaTid  dollars  to  be  approved 
by  the  said  commissioner  of  insurance,  for  the  faithful  discharge 
of  their  duties  as  such  officers:  thei'e  shall  be  filed  with  the  commis- 
sioner of  insurance  a  list  of  said  applications,  giving  the  name,  age 
and  residence  of  each  applicant,  and  the  amount  of  insurance  applied 
for  by  each,  together  with  the  annual  dues  and  the  proposed  assess- 
ments thereon,  which  statement  shall  be  verified  under  oath  by  the 
president  and  secretary  of  the  association. 

Section  710.  No  person  shall  act,  within  this  State,  as  agent  or 
otherwise,  in  receiving  or-  procuring  applications  for  insurance  for 
any  assessment  association,  except  for  the  purpose  of  taking  applica- 
tions for  organization,  unless  the  corporation  or  association  for  which 
he  is  acting  has  received  a  certificate  from  the  commissioner  of  insur- 
ance as  provided  for  in  this  article  authorizing  said  corporation  or 
association  to  transact  business  in  this  State ;  nor  as  general  agent 
or  traveling  solicitor  until  he  shall  have  received  from  said  commis- 
sioner of  insurance  a  certificate  in  substance  the  same  as  provided 
for  in  this  article;  and  that  said  general  traveling  agent  or  traveling 
solicitor  is  authorized  to  act  as  such. 

Section  711.  The  by-laws  of  any  such  corporation  or  association 
and  its  notice  of  assessment,  shall  state  the  object  or  objects  for 
which  the  money  to  be  collected  is  intended,  and  no  part  of  the  pro- 
ceeds of  such  assessment  shall  be  i)pi)lied  to  any  other  p\irpose  tlian 
is  stated  in  said  notices  and  by-laws,  and  the  excess  beyond  payment 


THE    STATE    OF    HOUTll    DAKOTA  809 

of  the  benefits  provided  for  in  siich  assessment  shall  be  set  aside  and 
applied  only  to  such  purposes  as  said  by-laws  and  notices  specify. 

Section  712.  No  corporation  or  association  organized  or  operated 
undci'  this  article  shall  issue  any  certificate  of  membership  or  policy 
to  any  person  under  the  age  of  fifteen  years  or  over  the  age  of  sixty 
years,  nor  unless  the  beneficiary  under  said  Certificate  shall  be  hus- 
band, wife,  relative,  legal  representative,  heir  or  legatee  of  such  in- 
sured member,  nor  shall  any  such  certificate  be  assigned;  and  any 
certificate  issued  or  assignment  made  in  violation  of  this  section  shall 
be  void.  Any  member  of  any  corporation,  association  or  society  op- 
erating under  this  article  shall  have  the  right  at  any  time,  with  the 
consent  of  such  corporation,  association  or  society,  to  make  a  change 
in  his  beneficiary,  without  the  consent  of  such  benefieiai'v. 

Section  713.  The  business  year  of  each  South  Dakota  corporation, 
association  or  society,  organized  or  operating  under  this  article,  shall 
close  on  the  thirty-first  day  of  December  each  year,  and  such  i-ov- 
poration  or  association  shall,  within  sixty  days  thereafter  prepare 
under  oath  of  its  president  and  secretary,  and  file  in  the  office  of  the 
commissioner  of  insurance  a  detailed  statement  of  its  assets,  liabili- 
ties, receipts  from  each  assessment  and  all  other  sources,  expendi- 
ture, salaries  of  officers,  number  of  contributing  members,  death 
losses  paid  and  amount  paid  on  each  loss,  death  losses  reported  and 
not  paid,  and  answer  such  other  interrogatories  as  the  commissioner 
of  insurance,  who  shall  furnish  blanks  for  that  purpose,  may  require, 
in  order  to  asee"+'^in  its  tnie  financial  condition,  and  shall  pay  upon 
filing  each  annual  statement  the  sum  of  ten  dollars.  The  coiumis- 
sioner  of  insurance  shall  publish  said  annual  statement  in  his  annual 
report,  and  for  the  purpose  of  verifying  such  statement  the  com- 
missioner of  insurance  may  make  or  cause  to  be  made  an  examina- 
tion of  any  company,  corporation  or  association  doing  business 
under  this  article,  at  the  expense  of  tlie  association,  or  corporation, 
which  expense  shall  not  exceed  six  dollars  per  day  and  the  neces- 
sary hotel  and  traveling  expenses  of  the  commissioner  of  insurance, 
or  person  he  may  appoint  for  that  purpose.  If  the  commissioner  of 
insurance  shall  deem  it  necessary  for  the  security  of  the  funds  of  the 
association,  he  may  require  the  official  bonds  of  the  officers  to  be 
increased  to  an  amount  not  to  exceed  double  the  sum  for  which  they 


870  FRATERNAL    SOCIETY    LAW 

are  accountable,  and  he  may  require  supplemental  reports  from  any 
such  association  at  such  time  and  in  such  form  as  he  may  direct. 

Section  714.  Any  corporation  or  association  accumulating  any 
trust  fund  or  moneys  to  be  held  in  trust  for  the  purpose  of  the  ful- 
fillment of  its  policy,  or  certificate,  contract,  or  otherwise,  shall  in- 
vest such  accumulations  in  bonds  or  treasury  notes  of  the  United 
States,  or  of  this  or  other  States,  or  in  interest-bearing  bonds  of 
any  municipal  corporation  in  South  Dakota,  or  in  notes  secured  by 
mortgage  on  unincumbered  real  estate  in  the  State  of  South  Dakota, 
not  to  exceed  fifty  per  cent,  of  the  appraised  value  thereof ;  exclusive 
of  imjirovements,  and  shall  deposit  such  securities  with  the  commis- 
sioner of  insurance  who  shall  furnish  such  corporation  or  association 
with  a  certificate  under  his  seal  of  office,  of  siich  deposit  showing 
the  purpose  of  such  deposit,  and  to  what  fund  the  same  is  to  be  ap- 
plied when  paid  out,  and  also  showing  the  aggregate  liabilities  of 
such  corporation  or  association  at  the  date  of  the  issuance  of  such 
certificate ;  Provided,  however,  that  such  corporation  or  association 
may  invest  in  real  estate  in  Swuth  Dakota  such  a  portion  of  such  ac- 
cumulation as  is  necessary  for  its  accommodation  in  the  transaction 
of  its  business,  to  be  owned  by  said  corporation  or  association,  and 
in  the  erection  of  any  building  for  such  purpose  may  add  thereto 
rooms  for  rental. 

Section  715.  Such  corporation  or  association  may  have  the  right 
at  any  time  to  change  its  securities  on  deposit  by  substituting  for 
those  withdrawn  a  like  amount  in  other  securities  of  the  character 
provided  for  in  this  article. 

Section  716.  The  commissioner  of  insurance  shall  permit  corpora- 
tions or  associations  having  a  deposit  with  him  for  such  securities 
to  withdraw  the  same  upon  filing  with  him,  by  the  presideut  and 
secretary  of  such  corporations  and  associations,  satisfactory  proofs 
that  they  iirc  to  lie  used  for  the  juirposi-  for  whicli  they  were  origi- 
nally deposited  in  his  office. 

Section  717.  The  commissioner  of  insurance  shall  permit  corpora- 
tions or  associations  having  on  deposit  with  him  such  stocks  and 
bonds,  notes  or  other  securities,  to  collect  and  ret;iiii  the  interest 
accruing  on  such  de])osits,  delivering  to  them  respectively  the  evi- 
dence of  interest  as  the  same  becotncs  due,  but  on  default  of  any 


THE    STATE    OF   SOUTH   DAKOTA  871 

corporation  or  association  to  make  or  enforce  such  collection,  he 
may  collect  such  interest  and  add  the  same  to  the  security  in  his 
possession  helonging-  to  snoh  corporntion  or  association,  less  the 
expense  of  such  collection. 

Section  718.  Any  foreign  corporation  or  association  organized 
under  the  law  of  any  other  State  to  carry  on  the  business  of  insuring 
the  lives  of  individuals  or  of  furnishing  benefits  to  the  widows,  or- 
phans, heirs  or  legatees  of  deceased  members,  or  in  paying  accident 
indemnity,  or  surrender  value  of  certificates  of  insurance  upon  the 
mutual  plan,  may  be  licensed  by  the  commissioner  of  insurance  to  do 
business  in  this  State  by  complying  with  the  following  conditions, 
to-wit:  Said  eorjioi-ation  shall  file  with  the  commissioner  of  insur- 
ance a  copy  of  its  charter  or  articles  of  incorporation  duly  certified 
by  the  proper  oi^eers  of  the  State,  wherein  organized,  together  with 
a  copy  of  its  by-laws,  application  and  policy  or  certificate  of  mem- 
bership. It  shall  also  file  with  the  commissioner  of  insurance  afore- 
said a  sworn  statement  signed  and  verified  by  its  president  and  sec- 
retary, which  statement  shall  contain  the  name  and  location  of  the 
said  corporation  or  association,  its  principal  place  of  business,  the 
name  of  its  president,  secretary  and  other  principal  officers,  the 
number  of  certificates  or  policies  in  force,  the  aggregate  amount 
insured  thereby,  the  amount  paid  to  the  beneficiaries  in  the  event  of 
death  or  accident,  the  amount  collected  from  each  member  on  each 
assessment,  and  the  purposes  for  which  assessments  are  made  and 
the  authority  under  which  they  are  made ;  the  amount  paid  on  last 
death  loss,  and  the  date  thereof;  the  amount  of  cash  or  other  assets 
owned  by  the  company  and  association,  and  how  invested  and  any 
information  that  the  commissioner  of  insurance  may  require.  All 
said  papers  and  statements  thus  filed  shall  show  that  death  or  sur- 
render value  of  certificate  of  insurance  or  accident  indemnity  is  in 
the  main  provided  for  by  assessments  upon  or  contributions  by  the 
surviving  members  of  such  corporation  or  association,  and  shall 
show  to  the  said  commissioner  of  insurance  that  said  corporation  or 
association  is  legally  organized  and  honestly  managed,  and  that  an 
ordinary  assessment  upon  its  members,  or  other  regular  contribution 
to  its  mortuary  fund,  is  sufficient  to  pay  its  maximum  certificate  to 
the  full  limit  named  therein.     Such  foreign  corporation  or  associa- 


872  FRATERNAL    SOCIETY    LAW 

tion  shall  also  designate  to  the  commissioner  of  insurance  an 
attorney  or  agent  residing  in  this  State  on  whom  service  of  process 
or  original  notice  may  be  made ;  and  in  event  of  a  failure  to  appoint 
or  designate  such  attorney,  such  service  may  be  made  upon  the  com- 
missioner of  insurance,  who  shall  at  once  notify  said  company  by 
mailing  a  copy  of  such  notice  to  the  secretary  of  said  corporation 
or  association,  directed  to  his  last  known  postoffice  address.  An 
action  commenced  in  this  State  by  service  iipon  such  attorney  or 
commissioner  of  insurance  may  be  commenced  in  the  county  of  the 
plaintiff's  residence,  regardless  of  the  residence  of  said  commissioner 
of  insurance  or  attorney,  and  every  corporation  or  association  com- 
ing nito  this  State  shall  file  with  the  commissioner  of  insurance  a 
contract  or  agreement  that  it  will  not  transfer  an.y  action  commenced 
against  it  in  any  court  of  this  State  to  the  United  States  courts, 
which  contract  shall  contain  the  provision  that  if  such  transfer  is 
made  to  the  United  States  courts,  the  certificate  of  authority  issued 
by  said  commissioner  of  insurance  to  do  business  shall  be  eancelled 
or  revoked.  And  it  shall  be  the  duty  of  said  commissioner  of  insur- 
ance to  promptly  revoke  the  certificate  of  such  corporation  or  asso- 
ciation as  soon  as  such  transfer  is  made ;  and  such  corporation  or 
association  shall  not  again  be  allowed  to  do  business  within  the 
State.  Upon  complying  with  the  provisions  of  this  section,  and  upon 
the  payment  of  twenty-five  dollars  and  the  filing  with  the  commis- 
sioner of  insurance  a  good  and  sufficient  bond,  as  required  from  sim- 
ilar companies  organized  under  the  laws  of  this  State,  the  commis- 
sioner of  insurance  shall  issue  to  such  foreign  corporation  or  associa- 
tion so  complying,  a  certificate  of  authority  to  do  business  in  this 
State.  Whenever  the  commissioner  of  insurance  of  this  State  shall 
have  reason  to  doubt  the  solvency  of  any  such  foreign  corporation  or 
association,  and  the  failure  to  jiay  the  full  limit  named  in  its  certifi- 
cate or  policy  shall  be  such  evidence  that  it  is  not  solvent  and  to  re- 
quire the  commissioner  of  insurance  to  investigate,  he  must  for  this 
or  other  good  cause,  at  the  expense  of  such  corporation  or  associa- 
tion, cause  an  examination  of  its  books  and  papers  to  be  made,  and 
if  in  his  judgment  such  examination  establishes  the  fact  that  such 
corporation  or  association  is  not  financially  sound  and  is  not  paying 
its  policies  to  the  full  limit  named  therein,  or  is  conducting  its  busi- 


THE    STATE    OF    SOUTH   DAKOTA  873 

ness  fraudulently,  or  if  it  should  fail  to  make  the  statement  required 
by  this  article,  he  may  revoke  the  authority  of  such  corporation  or 
association  and  iii-ol)il)it  it  from  doing  business  iti  this  Stato  until  it 
can  comply  with  the  provisions  of  this  article.  If  the  commissioner 
of  insurance  appoints  some  one  to  make  the  examination  as  provided 
for  in  this  section,  he  shall  be  entitled  to  receive  six  dollars  per  day 
for  his  services,  in  addition  to  his  actual  traveling  and  hotel  ex- 
penses, to  be  paid  by  the  association  examined. 

Provided,  the  same  right  is  extended  by  the  State  in  which  said 
cori)oration  or  as.sociation  is  organized,  to  similar  corporations  or 
associations  organized  in  this  State.  After  any  such  foreign  corpora- 
tion or  association  shall  have  been  licensed  to  do  business  in  this 
State,  it  shall  make  before  the  first  day  of  March  each  year,  to  the 
commissioner  of  insurance,  on  blank  furnished  by  him.  the  same 
detailed  statement  as  is  provided  in  this  chapter,  and  shall  also  pay 
to  the  commissioner  of  insurance,  on  filing  such  statement,  a  fee  of 
ten  dollars. 

Section  719.  Any  foreign  corporation  or  association  doing  busi- 
ness in  this  State  that  shall  refuse  to  neglect  to  comply  -with  the 
provisions  of  this  article  shall  be  deemed  and  be  held  to  be  doing 
business  unlawfully,  and  any  officer  or  agent  of  such  corporation  or 
association  who  shall  do  business  in  this  State,  or  assist  in,  or 
knowingly  permit  the  same  in  violation  of  the  provisions  of  this 
article  shall  be  deemed  guilty  of  a  misdemeanor  and  upon  conviction 
thereof  shall  be  fined  not  more  than  five  hundred  dollai-s  or  be  im- 
prisoned in  the  county  jail  not  more  than  six  months,  or  both,  in  the 
discretion  of  the  court.  It  shall  be  the  duty  of  the  State's  attorney 
acting  under  the  authority  of  the  commissioner  of  insurance  to  prose- 
cute any  violation  of  this  section  when  sufficient  evidence  is  pre- 
sented to  him  to  warrant  prosecution  of  any  person  charged  with  its 
violation. 

Section  720.  Any  solicitor  or  agent  taking  or  soliciting  applica- 
tions for  insurance  within  this  State,  for  any  corporation  or  asso- 
ciation doing  biisiness  on  the  mutual  assessment  or  natural  premium 
plan,  without  the  certificate  herein  provided  for.  or  shall  take  appli- 
cations when  the  assessments  will  not  pay  the  certificate  or  policj'' 
in  full,  without  having  the  application  form  comply  with  the  re- 


874  FRATERNAL    SOCIETY    LAW 

quirements  of  this  article,  shall  be  deemed  guilty  of  a  misdemeanor 
and  upon  conviction  thereof  shall  be  fined  in  a  sum  not  to  exceed 
one  hundred  dollars  for  each  offense  together  with  the  cost  of  prose- 
cution, including  attorney's  fee,  and  shall  stand  committed  to  the 
county  jail  until  the  fine  and  costs  are  paid.  And  the  State's  at- 
torney in  each  county  shall  prosecute  parties  charged  with  a  viola- 
tion of  this  section. 

Provided,  that  for  the  purposes  of  this  article  any  fraternal  or 
benevolent  society,  having  organized  a  grand  lodge  in  this  State, 
shall  be  deemed  a  domestic  corporation  and  shall  only  be  required 
to  pay  such  fees  as  are  required  of  other  corporations  of  like  char- 
acter. 

Provided,  further,  that  each  subordinate  lodge  shall  be  deemed 
an  agent  to  solicit  membership,  and  the  certificate  of  authority  pro- 
vided for  in  this  article,  shall  be  issued  in  the  name  of  each  sub- 
ordinate lodge,  and  shall  be  authority  for  each  member  of  said  lodge 
to  solicit  membership. 

Section  721.  When  any  South  Dakota  eorjioration  or  association 
shall  fail  to  make  its  annual  report  to  the  commissioner  of  insurance 
on  or  before  the  first  day  of  ]\Iarch,  or  is  conducting  its  business 
fraudulently  or  not  in  compliance  with  the  provisions  of  this  article, 
or  is  not  carrying  out  its  contracts  with  its  members  in  good  faith, 
then  it  shall  be  the  duty  of  the  commissioner  of  insurance  to 
promptly  communicate  the  fact  to  the  attorney  general,  who  shall 
promptly  commence  action  before  the  circuit  court  in  the  county  in 
which  said  organization  is  located,  or  any  judge  thereof,  citing  the 
officers  to  appear  before  said  court  or  judge;  and  if.  upon  hearing  of 
said  cause,  it  is  found  to  be  for  the  best  interests  of  the  holders  of 
certificates  of  membership  in  said  corporation,  said  court  or  judge 
shall  have  the  power  to  remove  any  officer  or  officers  of  said  corpora- 
tion and  appoint  others  in  their  place  until  the  next  annual  election. 
If  it  is  found  to  the  best  interests  of  said  holders  of  certificates  that 
the  affairs  of  said  corporation  be  wound  up.  said  court  or  judge  shall 
so  direct,  and  for  that  purpose  may  appoint  a  receiver,  who  shall 
regard  all  proper  claims  for  death  benefits  as  preferred  claims. 
Said  receiver  may  also,  upon  approval  of  the  court  or  judge,  trans- 
fer the  members  of  said  association  who  consent  thereto  to  som<> 


THE    STATU    OF    SOUTH    DAKOTA  875 

solvent  South  Dakota  assessment  or  naliiiMl  assdcialioii.  or  divide 
,the  surplus  accumulated  in  proportion  to  llio  share  due  each  cer- 
tificate in  force  at  the  time. 

Section  722.  The  commissioner  of  insuranct^  sluill  receive  from 
each  foreign  corporation  or  association  doing  business  in  this  State, 
for  each  certificate  issued  to  agents  or  solicitors,  the  sum  of  two  dol- 
lars; and  from  each  corporation  or  association  organized  under  the 
laws  of  this  State  the  sum  of  fifty  cents. 

Section  723.  On  compliance  with  this  article  by  the  corporation 
or  association,  the  commissioner  of  insurance  shall  issue  a  certificate 
setting  forth. 

First.     The  corporate  name  of  the  association. 

Second.     Its  principal  place  of  business. 

Third.  The  number  of  certificates  or  policies  in  force  at  the  date 
of  its  last  report. 

Fourth.  The  sum  of  money  which  an  ordinary  assessment  f(n' 
payment  of  a  single  certificate  or  policy  would  produce  in  each  class. 

Fifth.  The  amount  paid  on  its  last  death  loss  as  evidenced  by 
proof  on  file  in  his  office,  and  the  date  of  payment. 

Sixth.  The  amount  of  securities  deposited  in  his  office,  and  for 
what  purpose  deposited. 

Seventh.  That  it  has  fully  complied  with  the  provisions  of  this 
article,  and  is  authorized  to  transact  business  for  a  period  of  one 
year  from  January  first  of  the  year  of  its  issue. 

Section  724.  Any  corporation  or  association  doing  business  in 
this  State  which  provides  in  the  main  for  the  payment  of  death 
losses  or  accident  indemnity  by  any  assessment  upon  its  members 
or  upon  the  natural  jn-emium  plan,  shall,  for  the  jiurposes  of  this 
act,  be  deemed  a  mutual  benefit  association,  and  must  comply  with 
the  provisions  of  this  article.  No  corporation  or  association  oper- 
ating upon  the  assessment  plan,  promising  benefits  upon  any  other 
event  than  that  of  death,  or  disability  resulting  from  an  accident, 
or  sickness,  to  the  members,  shall  be  permitted  to  do  business  in  this 
State.  This  act  shall  not  relieve  any  corporation  or  assessment  asso- 
ciation now  doing  business  in  this  State  from  the  fulfillment  of  any 
contract  heretofore  entered  into  with  its  members  under  its  policies 
or  certificates  of  membership,  nor  shall  any  member  be  released 
hereby  from  his  or  her  part  of  said  contract. 


87ti  FRATERNAL    SOCIETY    LAW 

Section  725.  Every  uiiitual  benefit  association  or  insurance  com- 
pany organized  or  doini;  business  in  this  State,  shall,  at  the  time 
of  making  the  annnal  statements  required  l)y  this  act.  pay  into 
the  State  treasury  as  taxes  two  per  cent,  of  the  gross  amount  of 
assessments  received  in  this  State  during  the  preceding  year,  tak- 
ing duplicate  receipts  therefor,  one  of  which  shall  he  filed  with  the 
commissioner  of  insurance,  and  upon  tiling  such  receipts,  and  not 
until  then,  the  commissioner  of  insurance  shall  issue  the  annual 
certificate  provided  for  by  this  act.  The  said  sum  of  two  per  cent, 
shall  be  in  full  for  all  taxes,  State  and  local. 

Provided,  That  nothing  in  this  section  (Section  725)  shall  be  con- 
strued to  apply  to  seci'et  benevolent,  or  secret  fraternal  beneficial 
societies  paying  death,  sick,  or  accident  benefits  to  the  widows, 
orphans,  heirs  or  relatives  of  deceased  members,  having  a  represen- 
tative form  of  government,  conducting  business  solely  upon  the  as- 
sessment plan  through  subordinate,  grand  or  supreme  lodges  and 
not  organized  for  profit. 

Masonic  Assoc,  vs.  Taylor,  2  S.  D.  324;   16  S.  D.,  A.  0.  U.   W.  vs. 
Shober,  Com. 

Section  726.  Each  company  contemplated  in  this  act  shall  pay 
the  same  fees,  and  be  liable  to  the  same  obligations  as  provided 
for  in  the  case  of  fire  insurance  companies. 

Section  727.  The  following  general  provisions  of  this  article 
shall  appl.v  to  all  life  insurance  companies,  whether  stock  com- 
panies or  doing  business  upon  the  mutual  assessment  plan,  as  well 
as  to  all  mutual  benefit,  fraternal,  benevolent  and  charitable  asso- 
ciations, whether  organized  or  incorporated  under  the  laws  of  this 
State,  any  State  or  Territory  of  the  United  States,  or  any  foreign 
government,  and  trapsacting  the  business  of  life  insurance  within 
this  State. 

Section  728.  A  pdlicy  of  iiisuraiu'f,  to  the  extent  of  tive  thou- 
sand dollars,  on  the  life  of  an  individual,  in  \]\v  absence  of  an 
agi'eement  or  assignment  to  the  contrary,  shall  inure  to  the  separate 
use  of  the  husband  oi-  wife  and  children  of  sa'id  intlividual.  inde- 
pendentl.y  of  his  or  hci-  creditors;  anil  an  cinlowment  policy,  pa.v- 
able  to  the  ass\u'eil  mi  attaining  a  certain  age.  to  the  amount  of  five 


THE    STATE    OF    SOUTH    DAKOTA  877 

thousand  dollars,  shall  be  exempt  from  liabilities  from  ari.y  of  his 
or  her  debts,  and  the  avails  of  any  life  insurance,  or  any  other  sum 
of  money,  not  exceeding  in  amount  five  thousfind  dolliirs,  made  ]ifiy- 
iible  i)y  any  mutual  aid  or  liencvoicnt  society  upon  \\]r  ih-iilli  of  a 
member  of  such  socict.w  arc  nnt  sulijcct  td  (lie  ilchls  nf  tin'  deceased. 

Skinner  vs.  Holt,  9  S.  D.  i27. 

Section  729.  Each  corporation  aiul  associjition  mentioned  in  this 
article  shall  pa,v  the  same  fees,  and  be  liable  Id  the  same  obligations, 
as  prnvided  for  in  case  of  tire  insni'anei'  companies. 

Section  730.  In  all  suits  in  any  court  of  this  State  on  policies  of 
life  insurance  wherein  the  defendant  seeks  to  avoid  liability  upon 
the  alleged  ground  of  the  intemperate  habits  or  habitual  intoxication 
of  the  assured,  it  shall  be  a  sufficient  reply  for  the  plaintiff  to  show 
that  such  habits  or  habitual  intoxication  of  the  assured  were  gener- 
ally known  in  the  communit.v  or  neighborhood  where  the  agent  of 
the  defendant  resided  or  did  business,  if  thereafter  the  company 
continued  to  receive  the  premiums  falling  due  on  such  policy. 

Knudson  vs.  Ins.  Co.,  7  S.  D.  214. 

Section  731.  In  any  case  where  the  medical  examiner,  or  physi- 
cian acting  as  such,  of  any  life  insurance  company  doing  business  in 
this  State,  shall  issue  a  certificate  of  health  or  declare  the  applicant 
a  fit  subject  for  insurance  under  the  rules  and  regulations  of  such 
company,  the  company  shall  be  thereby  estopped  from  setting  up, 
in  defense  of  suit  on  such  policy,  that  the  assured  was  not  in  the 
condition  of  health  required  by  the  ]ioliey  at  tlie  time  of  i.ssuing  of 
such  policy,  except  where  the  same  is  ]H'oeui'ed  by  or  through  fraud 
or  deceit  of  the  assured. 

Section  732.  No  life  insurance  company  doing  business  in  the 
State  of  South  Dakota  shall  contest  a  claim  under  any  polic.v  of 
insurance  on  the  plea  of  fraud  or  irregularities  in  application  after 
three  annual  premium  payments  have  been  made  on  the  policy, 
except  as  to  understatements  of  age,  unless  it  shall  relate  to  some 
fact  material  to  the  risk  and  shall   have  been  intentionall.v  made. 


878  FRATERNAL    SOCIETY   LAW 

but  must  pay  the  full  amount  of  policy  within  sixty  days  after 
proofs  of  death  have  been  received  at  the  home  office  of  the  com- 
pany. 

Section  733.  That  in  all  cases  where  it  shall  appear,  that  the  age 
of  the  person  insured  has  been  misstated  in  the  proposal,  declara- 
tion, or  other  instrument  upon  which  any  policy  of  life  insurance 
has  been  founded  or  issue,  then,  and  in  such  case  the  person  or 
company  issuing  such  policy  shall,  upon  the  discovery  of  such  mis- 
statement, be  permitted  to  demand  and  collect  the  difference  in 
premium,  if  any,  which  would  be  due  and  payable  to  on  account 
of  the  true  age  of  the  assured,  from  year  to  year,  according  to  the 
rates  or  premium  of  such  person  or  company,  upon  which  such 
policy  was  issued ;  or  such  person  or  company  so  issuing  the  policy 
may,  after  the  decease  of  the  assured,  deduct  from  the  amount  pay- 
able by  such  policy,  the  difference  of  premium,  if  any,  which  would 
so  have  been  payable  from  year  to  year  by  reason  of  any  difference 
of  age  at  the  time  of  issuance  of  such  policy :  and  no  other  defense 
or  deduction  by  such  person  or  company  issuing  such  policy  shall 
be  permitted  after  the  death  of  the  person  assured,  on  account  of 
such  mis-statement  of  age  of  the  assured,  notwithstanding  any  war- 
rantj'  of  such  statement  of  age  by  terms  of  policy  or  otherwise, 
except  when  it  be  shown,  by  the  person  or  comjiany  insuring,  that 
the  policy  was  procured  by  fraud  in  fact. 

Section  734.  When  by  the  laws  of  any  State  or  Territory  any 
taxes,  fines,  penalties,  licenses,  fees,  deposits  of  money  or  securities, 
or  capital  requirements,  or  other  obligations  or  prohibitions  are  im- 
posed, or  would  be  imposed,  on  any  insurance  companies  of  the 
State,  doing,  or  that  might  seek  to  do.  business  in  such  State  or 
Territory,  or  upon  their  agents  therein,  so  long  as  such  laws  con- 
tinue in  force,  the  same  obligations  and  prohibitions,  of  whatever 
kind,  shall  be  imposed  upon  all  insurance  companies  of  such  State 
or  Territory  doing  business  within  this  State,  or  upon  their  agents 
here. 

Section  735.  Every  life  or  accident  insurance  company  doinu' 
business  in  this  State,  except  stock  and  mutual  companies  organ- 
ized under  the  laws  of  this  State,  shall  at  the  time  of  nuxking  the 
annual  statements  as  required  by  law,  pay  into  the  State  treas- 


THE    STATE    OF    SOUTH    DAKOTA  879 

ury  as  taxes,  two  and  one-half  per  cent,  of  the  gross  amount  of 
premiums  received  in  this  State  during  the  preceding  year,  talcing 
duplicate  receipts  therefor,  one  of  which  shall  be  filed  with  the  com- 
missioner of  insurance;  and  upon  the  filing  of  said  receipts,  and 
not  till  then,  the  said  commissioner  of  insurance  shall  issue  the 
annual  certificate  as  provided  by  law,  and  the  said  sum  of  two  and 
one-half  per  cent,  shall  be  in  full  for  all  taxes.  State  and  local. 

Section  736.  Any  agent,  physician  or  other  person  who  shall 
knowingly  and  by  means  of  concealment  or  false  or  fraudulent  state- 
ments assist  in  securing  any  insurance  on  the  life  of  any  person, 
shall  be  deemed  guilty  of  a  misdemeanor  and  upon  conviction 
thereof  shall  be  sentenced  to  pay  a  fine  not  exceeding  one  thousand 
dollars  or  undergo  an  imprisonment  of  not  more  than  one  year  in 
the  county  jail,  or  both,  in  the  discretion  of  the  court. 

Section  737.  All  fidelity  and  surety  companies  doing  business  in 
this  State  shall  comply  with  the  laws  governing  life  insurance 
companies  as  to  obtaining  certificates  of  authority,  making  and 
publishing  annual  statements,  appointments  of  attorney  or  agents, 
payment  of  taxes  and  fees,  and  as  to  reqiiirements  regarding  amount 
and  investment  of  capital  stock. 

Section  738.  Fraternal,  benevolent  and  secret  societies  or  associa- 
tions organized  or  operated  for  the  purpose  of  paying  death  benefits 
upon  its  assessment  plan  organized  ov  doing  business  in  this  State, 
must  comply  with  the  provisions  of  this  article. 

Beneficiary — Right  to  Change  Vested  Interests. 

Where  the  member  shortly  before  his  death  surrendered  his  cer- 
tificate, which  was  payable  to  his  wife,  and  received  one  payable  to 
his  sister,  in  an  action  b.v  the  wife  to  recover  the  amount  of  insur- 
ance— the  liability  of  the  society  being  admitted  and  the  contro- 
versy being  between  the  wife  and  the  sister — the  constitution  and 
by-laws  of  the  society  providing  there  should  be  no  vested  right  in 
the  sum  provided  to  be  paid  under  the  certificate,  and  that  the  same 
could  be  assigned,  does  not  afi'ect  the  rights  of  the  claimants. 

Benard    vs.   Grand   Lodge  A.  0.  U.  W.,  April,  1900,  13  S.  D.  132. 


880  FRATERNAL    SOCIETY    LAW 

Beneficiary,  When  There  is  an  Equitable  Interest  in  Certificate. 

Where  a  husband  obtained  a  certificate  payable  to  his  wife  under 
an  agreement  with  her  that  she  should  help  pay  therefor,  which  she 
did,  and  shortly  before  his  death  he  surrendered  the  certificate  and 
received  another  paj-able  to  his  sister,  who  was  a  mere  voluntary 
beneficiary,  the  wife  has  an  equitable  interest  in  the  proceeds  of  the 
insurance  superior  to  the  right  of  the  sister. 

Benard   vs.   Grand   Lodge   A.  O.  U.  W.,  April,  1900,  13  S.  D.  132. 

Suicide — What  Facts  Not  Conclusive  of. 

In  an  action  on  a  contract  where  the  defendant  clainied  that  the 
member  suicided,  and  the  attending  physician  in  proofs  of  death 
gave  suicide  as  the  cause  of  death,  the  evidence  merely  showed  that 
from  three  to  five  minutes  after  the  deceased  was  seen  walking  on 
the  street  he  was  found  dead  in  his  place  of  business  with  a  bullet 
in  his  brain  and  a  revolver  with  one  empty  chamber  lying  in  a  pool 
of  blood  under  one  of  his  limbs.  These  facts  were  held  not  neces- 
sarily indicative  of  suicide  to  such  an  extent  as  to  justify  the  court 
in  refusing  to  submit  the  question  of  suicide  to  the  jury. 

Dischner  vs.  Piqua  Mut.  Aid  Assn.,  May,  1901,  14  S.  D.  436. 

Contract,  When  Delay  in  Passing  on  Application  Does  Not  Make. 

Unreasonable  delay  of  an  insurance  company  in  acting  on  an 
application  for  insurance  does  not  amount  to  acceptance.  The  Court 
said: 

"There  was  no  contract,  simply  because  there  never  was  any  ac- 
ceptance of  the  application  on  the  part  of  the  defendant.  Our 
attention  has  been  called  to  no  decision  wherein  mere  delay  in  acting 
upon  an  application  for  insurance  is  construed  as  equivalent  to  an 
acceptance.  Contracts  are  not  created  without  consent.  Failure 
of  the  defendant  to  manifest  its  approval  of  the  plaintiff's  applica- 
tion within  a  reasonable  time,  should,  we  think,  be  regarded  as 
evidence  of  its  re.jection  ratlun'  than  of  its  acceptance." 

Brink  vs.  Merchants  &  Farmers  United  Mut.  Ins.  Assn.,  .luly,  1903, 
17  S.  D.  235. 


TBE    STATE    OF    SOUTH    DAKOTA  881 

Fraternal  Societies  Exempt  From  General  Insurance  Laws. 

A  .S('(!ti<in  of  tlu'  hiws  of  18!)()  provides  that  every  niiifiial  benefit 
association,  as  a  eoiidilidn  [)reee(lent  to  its  right  to  do  liiisiiiess, 
shall  pay  to  the  State  two  per  cent,  of  the  rtoss  amount  of  assess- 
ments received  by  it  in  the  State  during  the  ])receding'  year,  and 
adds : 

"Provided  that  nothing  in  this  section  shall  he  construed  to  aijply 
to  secret  benevolent  or  fraternal  societies  who  pay  sick  or  death 
benefits  to  the  widows,  orphans,  heirs  or  relatives  of  deceased  mem- 
bers." 

Held,  That  the  Ancient  Order  of  United  Workmen,  organized  to 
unite  its  members  into  a  fraternal  brotherhood  and  improve  their 
moral  and  social  condition,  to  create  funds  to  aid  them  during  sick- 
ness or  disability,  to  pay  a  stipulated  sum  to  the  members'  bene- 
ficiaries at  death,  and  possessed  of  a  secret  ritual,  was  a  secret  fra- 
ternal society  within  the  meaning  of  said  section,  and  not  liable  to 
the  payment  of  the  tax  as  a  condition  of  its  right  to  do  business 
within  the  State. 

Ancient  Order  of  United  Worl<men  vs.  Shober,  April,  1903,  16  S.  D. 
513. 

Suicide — Verdict  of  Coroner's  Jury  as  to  Not  Admissible  in  Evi- 
dence. 

The  verdict  of  a  coroner's  jury  that  one  whose  life  was  insured 
committed  suicide,  is  not  admissible  as  evidence  against  the  bene- 
ficiary in  an  action  on  the  benefit  certificate,  on  the  issue  of  suicide 
of  the  member. 

Chambers  vs.  Modern  Woodmen  of  America.  June,  1904,  18  S.  D.  173. 

Statutes  of  Limitation  by  Societies  Void. 

Under  Section  1276  of  the  Civil  Code,  which  provides  that  every 
condition  in  a  contract  whicli  limits  the  time  within  which  a  party 
may  enforce  his  rights  is  void,  a  provision  in  an  insurance  contract 

56 


882  FRATERNAL    SOCIETY    LAW 

that  no  action  can  be  maintained  thereon  unless  commenced  within 
twelve  months  after  the  maturity  of  the  contract,  is  void. 

Vesey  vs.  Commercial  Union  Assurance  Co.,  Dec.,  1904,  18  S.  D.  632; 
Phoenix  Ins.  Co.  vs.  Perkins,  January,  1905,  19  S.  D.  59. 

Agency — Delivery  of  Proofs  of  Loss  to. 

The  delivery  of  proofs  of  loss  under  a  fire  insurance  policy  to  the 
agent  of  a  foreign  insurance  company,  who  was  authorized  to  solicit 
applications  and  write  and  deliver  policies,  was  a  sufficient  delivery 
to  the  insurer  where  the  policy  only  required  delivery  to  the  com- 
pany. 

Vesey  vs.  Commercial  Union  Assurance  Co.,  Dec,  1904,  IS  S.  D.  632. 


THE   STATE    OF    TENNESSEE  883 


THE 

STATE  OF  TENNESSEE. 

CHAPTER  43. 

The  State  of  Tennessee  has  a  code  for  the  government  of  fraternal 
societies  which  became  a  law  April  17,  1905.  It  is  one  of  the  most 
complete  fraternal  codes  upon  the  statute  books  and  is  as  follows: 

Section  1.  That  any  corporation,  society,  order  or  voluntary  as- 
sociation without  capital  stock,  organized  and  carried  on  solely 
for  the  mutual  benefit  of  its  members  and  their  beneficiaries,  and 
not  for  profit,  and  having  a  lodge  system  with  ritualistic  form  of 
work  and  representative  form  of  government  and  which  shall  make 
provisions  for  the  payment  of  death  benefits,  and  which  may  make 
provisions  for  the  payment  of  disability  benefits,  or  both,  is  hereby 
declared  to  be  a  fraternal  benefieiarv  association. 

Section  2.  That  any  association  having  a  supreme  governing  or 
legislative  body  and  subordinate  lodges  or  branches  by  whatever 
name  known  into  which  members  shall  be  elected,  initiated  and  ad- 
mitted in  accordance  with  its  constitution,  laws,  rules,  regulations 
and  prescribed  ritualistic  ceremonies,  which  subordinate  lodges  or 
branches  shall  be  required  by  such  association  to  hold  regular  or 
stated  meetings  at  least  once  in  each  month,  .shall  be  deemed  to  be 
operating  under  the  lodge  system. 

Section  3.  That  any  association  shall  be  deemed  to  have  a  repre- 
sentative form  of  government,  when  it  shall  provide  in  its  constitu- 
tion and  laws  for  a  supreme  legislative  or  governing  body,  composed 
of  representatives  elected  either  by  the  members  or  by  delegates 
elected  bv  the  members  through  a  delegate  convention  system  to- 


884  FRATERNAL    SOCIETY    LAW 

gether  with  such  other  members  as  may  be  prescribed  liy  its  eoii- 
stitution  and  laws,  provided  that  the  elective  representatives  shall 
constitute  a  majority  in  number  and  have  not  less  than  a  majority 
of  the  votes,  nor  less  than  the  votes  required  to  amend  its  constitu- 
tion and  laws,  and  provided  further  that  the  meetings  of  the  supreme 
or  governing  body  and  the  election  of  officers,  representatives  or 
delegates  shall  be  held  as  often  as  once  in  f(mr  years.  The  members, 
officers,  representatives  or  delegates  of  a  fratcrjial  beneficiary  society 
shall  not  vote  by  proxy. 

Section  4.  That,  except  as  herein  provided,  such  association  shall 
be  governed  by  this  act  and  shall  be  exempt  from  all  provisions  of 
the  insurance  laws  of  this  State,  not  only  in  governmental  relations 
with  the  State,  bnt  for  every  other  purpose,  and  no  law  hereafter 
passed  shall  apply  to  them,  unless  they  be  expressly  designated 
therein. 

Section  5.  That  every  association  transacting  business  under  this 
act  shall  provide  for  the  payment  of  death  benefits,  and  may  provide 
for  the  payment  of  benefits  in  case  of  temporary  or  permanent 
physical  disability,  either  as  the  result  of  disease,  accident  or  old 
age,  provided  the  period  of  life,  at  which  the  payment  of  benefits 
for  disability  on  account  of  old  age  shall  commence,  shall  not  be 
under  seventy  years ;  except  as  otherwise  provided  in  this  act  no 
association  shall  issue  or  offer,  or  promise  to  issue,  any  contract  pro- 
viding for  the  payment  of  any  other  benefit,  or  any  contract  which 
does  not  provide  for  the  regular  payments  or  assessments  during 
the  entire  existence  of  the  contract. 

Section  6.  That  the  payment  of  death  benefits  shall  be  confined 
to  the  wife.  Imsband.  family,  relatives  by  blood,  marriage  or  legal 
adoption,  affianced  husband,  or  affianced  wife,  or  to  a  person  or 
persons  dependent  on  the  member,  subject  to  the  limitation  and  con- 
trol of  the  association  as  to  the  designation  of  beneficiaries  witliin 
said  classes. 

Section  7.  That  no  association  shall  admit  to  beneficial  member- 
ship any  person  less  than  sixteen  (16)  nor  nun'c  than  sixty  (60) 
years  of  age,  nor  any  person  who  has  not  been  examined  by  a  legally 
qualified  practicing  physician,  and  whose  examination  has  not  been 
approved  by  the  supervising  medical  authority  of  the  association 


THE    .STATIC    OF    TKN'NESSEE  885 

as  provided  liv  the  hiws  of  tlir  ;isso<dat iciii :  Provided,' thai,  such 
examination  shall  not  he  required  of  associations  paying  death 
benefits  not  exceeding  three  hundred  (300)  dollars. 

Section  8.  That  every  certificate  issued  by  the  association  shall 
specify  the  definite  amount  of  ]>enefit  provided  by  the  contract,  and 
shall  provide  that  the  certificate,  the  constitution  and  laws  of  the  as- 
sociation and  the  application  for  membership  and  medical  examina- 
tion, signed  by  the  applicant,  shall  constitute  the  contract  between 
the  association  and  the  member,  and  copies  of  the  same,  certified  by 
the  secretary  of  the  association  or  corresponding  oflieer,  shall  be 
received  in  evidence  of  the  terms  and  conditions  of  the  contract ;  and 
any  changes,  additions  or  amendments  to  said  charter  or  articles  of 
association,  constitution  or  laws  duly  made  or  enacted  subsequent  to 
the  issuance  of  the  benefit  certificate  shall  bind  the  member  and  his 
beneficiaries,  and  shall  govern  and  control  the  contract  in  all  re- 
spects the  same  as  though  such  changes,  additions  or  amendments 
had  bt'en  made  pi-ior  to  and  wiM'r  in  force  at  the  time  of  the  a|)pli- 
cation  for  membership :  Provided,  however,  that  the  constitution 
and  laws  of  any  such  association  shall  never  be  amended  or  in  any 
way  altered,  except  by  the  supreme  legislative  or  governing  body 
in  a  regular  or  special  meeting  called  for  that  pur|  osc,  and  no 
amendment  to  the  constitution  and  laws  shall  in  any  way  atfeet  the 
rights  of  any  beneficiary  whose  claim  accrued  by  death  or  other- 
wise prior  to  the  passage  of  such  amendment. 

Section  9.  That  any  association  may  create,  maintain,  invest,  dis- 
burse and  apply  a  reserve,  emergency,  surplus  or  other  fund  in  ac- 
cordance with  its  constitution  and  laws  for  the  purposes  specified  in 
Section  .5  of  this  Act.  Any  such  association  so  creating,  maintain- 
ing, investing,  disbursing  or  applying  -.my  such  reserve,  emergency 
or  surplus  fund,  shall  not  be  held  to  be  organized  or  carried  on  for 
profit  within  the  intent  of  the  provisions  of  Section  1  of  this  Act. 
Such  funds  shall  be  held,  invested  and  disbursed  for  the  use  and 
benefit  of  the  association,  and  no  member  or  beneficiary  shall  have 
or  acquire  any  individual  rights  therein,  or  be  entitled  to  an  appor- 
tionment or  the  surrender  of  any  part  thereof.  The  funds  from 
which  benefits  shall  be  paid  and  the  funds  from  which  the  expenses 
of  the  aissociation  shall  be  defrayed  shall  be  derived  froju  periodical 


886  FRATERNAL    SOCIETY    LAW 

or  other  payments  by  the  members  of  the  association  and  accretions 
of  said  funds :  Provided,  that  reg\ilar  periodical  payments  shall 
not  be  made  oftener  than  once  per  month ;  and  every  such  associa- 
tion shall  provide  in  its  constitution  or  laws  that  if  such  regular 
payments  are  insufficient  to  pay  all  matured  death  and  disability 
claims  in  full,  and  to  provide  for  the  creation  and  maintenance  of 
the  funds  required  by  its  constitution  and  laws,  extra  assessments 
or  other  payments  may  be  levied  upon  the  members  to  meet  such 
deficiency. 

Section  10.  That  any  association  may  invest  its  funds  in  and 
hold  real  estate  for  lodge  and  office  purposes,  and  any  real  estate 
acquired  by  foreclosure  or  received  in  satisfaction  of  loans,  and 
may  sell  and  convey  the  same.  Any  such  association  may  also  invest 
its  funds  in  government.  State,  provincial,  county  or  municipal 
bonds,  or  bonds  of  any  township,  park  or  school  district  having 
taxing  powers,  provided  that  such  bonds  shall  be  a  direct  obligation 
on  all  the  taxable  property  within  such  municipality  or  district,  and 
the  net  indebtedness  of  such  municipality  or  district  shall  not  exceed 
five  (5)  per  centum  of  the  value  of  all  taxable  property  therein 
according  to  the  last  valuation  for  taxation  preceding  the  issuance 
of  said  bcmds;  or  in  first  mortgages  or  first  mortgage  bonds  upon  im- 
proved real  estate  for  not  exceeding  fifty  (50)  per  centum  of  the 
actual  cash  value  thereof  at  the  time  of  making  the  loan :  Provided, 
however,  that  every  foreign  association  shall  be  empowered  to  invest 
its  funds  in  such  securities  as  may  be  permitted  by  the  laws  of  the 
State,  province  or  country  in  which  it  is  organized. 

Section  11.  That  every  association  shall  make  provision  in  its 
constitution  and  laws  for  payment  by  members  of  such  an  associa- 
tion, which  provision  shall  state  the  purpose  of  the  same  and  the 
proportion  thereof  which  may  be  used  for  expenses,  and  no  part  of 
the  money  collected  for  mortuary  or  disability  purposes  and  no  part 
of  the  reserve,  emergency  or  surplus  funds  or  the  net  accretions  of 
either  or  any  of  said  funds,  shall  be  used  for  expenses. 

Section  12.  That  the  ni(iiu'\-  or  (ithcr  lienefits,  charity,  relief,  or 
aid,  to  be  paid,  provided  or  rendered  by  any  association  authorized 
to  do  business  under  this  Act,  shall,  neither  before  nor  after  being 
paid,   be   liable  to  attachment,   garnishment   or  other   process,  and 


THE    STATE    OF    TENNESSEE  887 

shall  not  be  seized,  taken,  appropriated  or  applied  by  an>'  lewal  or 
equitable  jn-ocess  or  operation  of  law  to  ]iiiy  any  debt  or  liability 
of  a  certificate  holder,  or  of  any  beneficiary  named  in  a  certificate, 
or  of  any  person  who  may  have  any  right  thereunder ;  such  associa- 
tions are  hereby  declared  to  be  charitable  institutions,  and  the  prop- 
erty held  and  used  for  lodije  purposes  and  the  funds  of  such  associa- 
tions shall  be  exempt  from  taxation  under  the  preneral  tax  or 
revenue  laws  of  the  State. 

Section  13.  That  five  or  more  persons,  citizens  of  this  State,  who 
desire  to  form  a  fraternal  or  beneficiary  association  as  defined  by 
this  Act,  may  take  out  a  charter  in  the  way  and  manner  provided 
by  law,  in  which  shall  be  stated: 

First — The  proposed  corporate  name  of  the  association,  which 
shall  not  so  closely  resemble  the  name  of  any  association  or  insur- 
ance companj'  already  transacting'  business  in  this  State  as  to  mis- 
lead the  public  or  lead  to  confusion. 

Second — The  purpose  for  which  it  is  formed — which  shall  not 
include  more  liberal  powers  than  are  granted  by  this  Act,  provided 
that  any  lawful,  social,  intellectual,  educational,  moral  or  religious 
advantages  may.be  set  forth  among  the  purposes  of  the  association — 
and  the  mode  in  which  its  corporate  powers  are  to  be  exercised. 

Third — The  names,  residences  and  official  titles  of  all  the  officers, 
trustees,  directors,  or  other  persons  who  are  to  have  and  exercise 
the  general  control  and  management  of  the  afi'airs  and  funds  of  the 
association  for  the  first  year  or  until  the  ensuing  election  at  which 
all  such  officers  shall  be  elected  by  the  supreme  legislative  or  gov- 
erning body. 

Such  articles  of  association  and  duly  certified  copies  of  the  con- 
stitution and  laws,  rules  and  regulations,  and  copies  of  all  proposed 
forms  of  benefit  certificates,  applications  therefor  and  literature  to 
be  issued  by  such  association,  and  a  bond  in  the  sum  of  five  thousand 
dollars,  with  sureties  approved  by  the  Insurance  Commissioner,  con- 
ditioned upon  the  return  of  the  advanced  payments,  as  provided  in 
this  section,  to  applicants,  if  the  organization  is  not  completed  in  one 
year,  or  after  such  further  period,  not  exceeding  one  year,  as  may  be 
authorized  by  the  Insurance  Commissioner,  shall  be  filed  with  the 
Insurance  Cominissioner.  who  may  require  such  further  information 


888  FRATERNAL    SOCIETY    LAW 

as  he  deems  necessary,  and  if  the  purposes  of  the  association  con- 
form to  the  requirements  of  this  Act  and  all  provisions  of  the  law- 
have  been  complied  with,  the  Insurance  Commissioner  shall  so  certify 
and  retain  and  keep  on  file  and  furnish  the  incorporators  a  pre- 
liminary certificate  authorizing  said  association  to  solicit  members 
as  hereinafter  provided. 

Upon  receipt  of  said  certificate  from  the  In-surance  Commissioner 
said  association  may  solicit  members  for  the  purpose  of  completing 
its  organization  and  shall  collect  from  each  applicant  the  amount  of 
not  less  than  one  death  benefit  assessment  or  payment,  in  accord- 
ance with  its  tables  of  rates  as  provided  by  its  constitution  and  laws, 
and  shall  issue  to  each  such  applicant  a  receipt  for  the  amount  so 
collected.  But  no  such  association  shall  incur  any  liability  other 
than  for  such  advance  payments  nor  i.ssue  any  benefit  certificate, 
nor  pay  or  allow,  or  offer  a  promise  to  pay  or  allow  to  any  person 
any  death  or  disabilitj^  benefit  until  actual  bona  fide  applications 
for  death  benefit  certificates  have  been  secured  upon  at  least  five 
hundred  lives  for  at  least  one  thousand  dollars  each,  and  all  such 
applicants  for  death  benefits  shall  have  been  regularly  examined  by 
legally  qualified  i)racticing  physicians  and  certificates  of  such  ex- 
aminations have  been  duly  filed  and  approved  by  the  chief  medical 
examiner  of  such  association,  nor  until  there  shall  be  established  ten 
subordinate  lodges  or  branches  into  which  said  five  hundred  ai)i)li- 
cants  have  been  initiated,  nor  until  there  has  been  submitted  to  the 
Insurance  Commissioner  under  oath  of  the  president  and  secretary 
or  corresponding  officers  of  such  association  a  list  of  such  applicants, 
giving  their  names,  addresses,  date  examined,  date  approved,  ilate 
initiated,  name  and  number  of  the  subordinate  branch  of  which  each 
applicant  is  a  membei\  amount  of  benefits  to  be  granted,  rate  of 
regular  payments  or  assessments,  which  shall  not  be  lower  for  death 
benefits  than  lliose  required  by  the  National  Fraternal  Congress 
table  of  mortality,  with  interest  at  four  per  cent  per  annum;  nor 
until  it  shall  be  shown  to  the  Insurance  Commissioner  by  the  sworu 
statement  of  the  treasurer  or  corresponding  officer  of  such  associa- 
tion, that  at  least  five  hundred  applicants  have  each  paid  in  cash 
at  lea.st  one  regular  monthly  i)ayment  or  assessment  as  herein  pro- 
vided per  one  thousand  dollars  of  indemnity  to  be  effected,  which 


THE    STATE    OF    TENMESSEE  889 

payments  in  tho  aggregate  shall  amount  to  at  least  twenty-five  hun- 
dred dollars,  all  of  which  shall  be  credited  to  the  niorluai'v  nr  disa- 
bility fund  on  account  of  such  applicants  and  nci  ])art  of  which  may 
be  used  for  expenses. 

Said  advanced  payments  shall  during  the  ])eriod  ol'  organization 
be  held  in  trust  for  and.  if  the  organization  is  not  couiDletod  within 
one  year  as  hereinafter  provided,  returned  to  said  ajjplicaiits. 

The  Insurance  Commissioner  may  make  such  examination  and  re- 
quire such  further  information  as  he  may  deem  advisable,  and  upon 
presentation  of  satisfactory  evidence  that  tlic  association  has  com- 
plied with  all  the  provisions  of  the  law  he  shall  issue  to  sueli  asso- 
ciation a  certificate  to  that  effect.  Such  certificate  shall  be  prima 
facie  evidence  of  the  existence  of  such  association  at  the  date  of  such 
certificate.  The  Insurance  Commissioner  shall  cause  a  record  of  such 
certificate  to  be  made  and  a  certified  copy  of  such  record  may  be 
given  in  evidence  with  jike  effect  as  the  original  certificate. 

No  preliminary  certificate  granted  under  the  provisions  of  this 
section  shall  be  valid  after  one  year  from  its  date,  or  after  such 
further  period,  not  exceeding  one  year,  as  may  be  authorized  b.v  the 
Insurance  Commissioner  upon  cause  shown,  unless  five  hundred 
applicants  herein  required  have  been  secured  and  the  organization 
has  been  completed  as  herein  provided,  and  the  articles  of  associa- 
tion and  all  proceedings  thereunder  shall  become  null  and  void  in 
one  .vear  from  the  date  of  said  preliminary  certificate,  or  at  the  ex- 
piration of  said  extended  period,  unless  such  association  shall  have 
completed  its  organization  and  commenced  business  as  herein  pro- 
vided. When  any  domestic  association  shall  have  discontinued  busi- 
ness for  the  period  of  one  year,  its  charter  shall  become  null  and 
void. 

Section  14.  That  any  domestic  association  now  engaged  in  trans- 
acting business  in  this  State,  may  exercise,  after  the  passage  of  this 
Act,  all  of  the  rights  conferred  thereby,  and  in  addition  thereto  may 
exercise  all  of  the  rights,  powers  and  privileges  now  exercised  or 
possessed  by  it  under  its  charter  or  articles  of  association  not  in- 
consistent with  this  Act,  or  it  may  be  reincorporated  hereunder. 
But  no  such  association  alread.v  organized  shall  be  required  to  rein- 
corporate hereunder,  nor  shall  it  be  rei|uir(^d  to  ado])t  the  rules  pre- 


890  FRATERNAL    SOCIETY   LAW 

scribed  herein  for  new  associations,  in  order  to  avail  itself  of  the 
privileges  of  this  Act,  and  any  such  association  may  amend  its 
articles  of  association  from  time  to  time  in  the  manner  provided 
therein,  or  in  its  constitution  or  laws,  and  all  such  amendments  shall 
be  filed  with  the  Insurance  Commissioner,  and  shall  become  operative 
upon  such  filing  unless  a  later  time  be  provided  in  such  amendments, 
or  in  its  articles  of  association,  constitution  or  laws. 

Section  15.  That  no  domestic  association  shall  transfer  its  mem- 
bership or  funds  to  any  association  not  authorized  l)y  the  Insurance 
Commissioner  to  transact  business  in  this  State;  nor  shall  any  such 
association  transfer  its  membership  or  funds  to  any  licensed  associa- 
tion, unless  the  said  contract  to  transfer  has  been  approved  by  a  two- 
thirds  vote  of  the  trustees  or  board  having  charge  of  the  association 
whose  membership  is  proposed  to  be  transferred;  and  by  a  two- 
thirds  vote  of  the  triistee  or  board  having  charge  of  the  association 
proposing  to  take  such  membership. 

Section  16.  That  no  fraternal  beneficiary  association  shall  be  au- 
thorized to  do  business  in  this  State  under  the  provisions  of  this 
Act,  whether  incorporated  under  the  laws  of  this  or  any  other  State, 
province  or  territory,  which  associates  with,  or  seeks  to  associate 
with,  as  members  of  the  same  lodge,  order,  fraternity,  society  or 
association,  the  white  and  colored  races  with  the  objects  and  pur- 
poses provided  in  this  Act. 

Section  17.  That  foreign  associations  which  are  now  authorized 
to  transact  business  in  this  State  in  accordance  with  this  Act  may 
continue  such  business  until  the  first  day  of  April  next  succeeding 
the  passage  of  this  Act,  and  the  authority  of  such  associations  may 
thereafter  be  renewed  annually,  but  in  all  cases  to  terminate  on  the 
first  day  of  the  succeeding  April.  For  each  such  license  or  renewal 
the  association  shall  paj-  the  Insurance  Commissioner  $10.  A  duly 
certified  copy  of  such  license  shall  be  prima  facie  evidence  that  the 
licensee  is  a  fraternal  beneficiary  association  within  the  meaning 
of  this  Act. 

Section  18.  That  no  foreign  association  which  is  not  now  author- 
ized to  transact  business  in  this  State  shall  transact  any  l)usiness 
herein  without  a  license  from  the  Insurance  Comniis.sioner.  Before 
receiving  such  license  it  shall  filo  with  the  Insurance  Commissioner 


THE    STATE    OF    TENNESSEE  891 

a  duly  certified  copy  of  its  charter  or  articles  of  association ;  a  copy 
of  its  constitution  and  laws,  certified  by  its  secretary  or  correspond- 
ing officer;  a  power  of  attorney  to  the  Insurance  Commissioner  as 
hereinafter  provided ;  a  statement  under  oath,  of  its  president  and 
secretary,  or  corresponding  officers,  in  the  form  requii'ccl.  l)y  the  In- 
surance Commissioner  duly  verified  by  an  examination  made  by  the 
supervising  insurance  official  of  its  home  State  of  the  business  for 
the  preceding  year;  a  copy  of  its  contract,  which  must  show  that 
benefits  are  provided  for  l)y  assessments  upon  or  other  payments  by 
the  persons  holding  similar  contracts,  and  shall  furnish  the  Insurance 
Commissioner  with  such  other  information  as  he  may  deem  neces- 
sary to  a  proper  exhibit  of  its  business  and  plan  of  working,  and  if 
he  finds  that  it  is  transacting  business  in  accordance  with  the  pro- 
visions of  this  Act,  that  its  assets  are  invested  in  accordance  with 
the  laws  of  the  State  where  it  is  organized,  and  that  it  has  the  mem- 
bership and  qualifications  i"e(|uired  of  domestic  associations  organ- 
ized under  this  Act,  he  may  license  such  association  to  do  business 
in  this  State  until  the  first  day  of  the  succeeding  April,  and  such 
license  may  be  renewed  annually,  but  in  all  cases  to  terminate  on 
the  first  day  of  the  succeeding  April. 

Section  19.  That  no  license  shall  be  issued  to  any  association  not 
now  transacting  business  in  this  State  which  collects  from  any  of  its 
members  assessments  or  payments  for  death  benefits  lower  than  those 
required  by  the  Fraternal  Congress  Mortality  Table  of  1900,  with 
interest  at  four  per  cent  per  annum :  Provided,  that  this  section 
shall  not  apply  to  fraternal  beneficiary  associations  organized  prior 
to  January  1,  1885. 

Section  20.  That  when  the  Insurance  Commissioner  refuses  to 
license  any  association,  oi"  revokes  its  authority  to  do  business  in 
this  State,  he  shall  reduce  his  ruling,  order  or  decision  to  writing 
and  file  the  same  in  his  office,  and  shall  furnish  a  copy  thereof,  to- 
gether with  a  statement  of  his  reasons,  to  the  officers  of  the  asso- 
ciation, upon  request.  Any  society  affected  by  any  such  ruling, 
order  or  decision  shall  have  the  right  to  appeal  to  any  court  of 
competent  jurisdiction  in  this  State  by  filing  with  said  commissioner 
a  notice  of  such  appeal  in  writing,  stating  specifically  to  which  court 
such  appeal  is  proposed  to  be  taken,  and  in  such  case  said  commis- 


892  FRATERNAL    SOCIETY    LAW 

sioner  shall  fi)rtlnvith,  ami  within  ten  days  thereafter,  deliver  to 
such  association  a  foil  and  certified  transcript  of  all  proceedings 
had  before  him  in  such  matter,  including  all  applications.  to<;ether 
with  all  orders,  rulings  and  decisions  had  thereon,  and  on  such  trans- 
cript being  filed  in  said  court,  such  cnurt  shall  be  fully  possessed 
of  said  action,  and  a  full  trial  on  the  merits  de  novo  shall  be  had 
thereon:  Provided,  that  such  appeal  shall  be  filed  in  such  court 
within  forty  days  after  the  rendition  of  the  ruling,  order  or  de- 
cision appealed  from:  And  provided  further,  that  nothing  con- 
tained in  this  or  the  preceding  section  shall  be  taken  or  construed 
as  preventing  any  such  association  from  continuing  in  good  faith 
all  contracts  made  in  this  State  during  the  time  such  association 
was  legally  authorized  to  transact  business  herein. 

Section  21.  That  every  foreign  association  now  transacting  busi- 
ness in  this  State  shall  within  thirty  days  after  the  passage  of  this 
act,  and  every  such  association  hereafter  applying  for  admission, 
shall,  before  being  licensed,  appoint  in  writing  the  Insurance  Com- 
missioner and  his  .successors  in  office  to  be  its  true  and  lawful  attor- 
ney, upon  whom  all  legal  process  in  any  action  or  proceeding  against 
it  shall  be  served,  and  in  such  writing  shall  agree  that  any  lawful 
process  against  it,  which  is  .served  upon  said  attorney,  shall  be  of 
the  same  legal  force  and  validity  as  if  served  upon  the  association, 
and  that  the  authority  shall  continue  in  force  so  long  as  any  liability 
remains  outstanding  in  this  State. 

Copies  of  such  appointment,  certified  by  the  Insurance  Commis- 
sioner, shall  be  deemed  sufficient  evidence  thereof,  and  shall  be  ad- 
mitted in  evidence  with  the  same  force  and  effect  as  the  original 
thereof  might  be  admitted.  Service  ma.v  oiil.\  1)c  liad  upon  such  at- 
torney, must  be  made  in  duplicate  and  shall  be  deemed  sufficient 
service  upon  such  association,  ju-ovided,  however,  that  no  such 
service  shall  be  valid  nr  binding  against  any  such  association  when 
it  is  required  thereunder  to  file  its  answer,  pleading  or  defense  in 
less  than  thirty  days  after  the  date  of  such  service.  When  legal 
process  against  any  association  is  served  upon  said  Insurance  (Com- 
missioner, he  shall  [forward]  forthwith  by  registered  inail  one  of 
the  dupliciite  copies,  pre])aid  and  directed  to  its  secretary  or  corre- 
sponding officer.     The  plaintiff'  in  such  process  so  served  shall  pay 


THE    STATE    OF    TENNEfiSEE  893 

CO  the  Insurance  Commissioner  foi-  1lic  nsc  ol'  llie  State  at  flic  time 
of  sueh  service  a  fee  of  $2.  which  shall  he  recovered  hy  him  as  part 
of  the  taxable  costs,  if  he  prevails  in  the  suit. 

Section  22.  That  any  domestic  association  may  jirovide  that  the 
meetings  of  its  legislative  or  governing  body  may  lie  held  in  any 
State,  district,  province  or  teri-itory  wherein  such  association  has 
subordinate  branches,  and  all  business  transacted  at  such  meetings 
shall  be  as  valid  in  all  respects  as  il"  such  meetings  were  held  in  this 
State.    But  its  principal  otRce  .shall  be  located  in  this  State. 

Section  2:^.  That  olflcers  and  members  of  the  supreme  or  grand 
or  any  subordinate  body  of  any  such  incorporated  association,  shall 
not  be  individually  liable  for  the  payment  of  any  disability  or  death 
benefits  provided  for  in  the  laws  and  contracts  of  such  association, 
but  the  same  shall  be  payable  only  out  of  the  funds  of  such  associa- 
tion and  in  the  manner  provided  by  its  laws. 

Section  24.  That  the  constitution  and  laws  of  the  association  may 
provide  that  no  subordinate  body,  nor  any  of  its  officers  or  members 
shall  have  the  power  or  authority  to  waive  any  of  the  provisions 
of  the  laws  and  constitution  of  the  association,  and  the  same  shall 
be  binding  on  the  association  and  each  and  every  member  thereof. 

Section  25.  That  all  grand  lodges  by  whatever  name  known, 
whether  incorporated  or  not,  holding  charters  from  a  supreme  gov- 
erning body,  which  are  conducting  luisiness  in  this  State  upon  the 
passage  of  this  Act  as  a  fraternal  beneficiary  association  upon  what 
is  known  as  the  separate  .jurisdiction  plan,  shall  be  treated  as  a  fed- 
eration of  grand  lodges  and  not  as  single  State  organizations,  and 
all  reports  required  by  the  provisions  of  this  Act  shall  be  made  and 
furnished  by  the  officers  of  each  sujireme  governing  body  and  shall 
embrace  and  contain  the  transactions,  liabilities  and  assets  of  the 
entire  order. 

Section  26.  That  every  association  transacting  business  under 
this  Act  shall  file  with  the  Insurance  Commissioner  a  duly  certified 
copj'  of  all  amendments  of,  or  additions  to,  its  constitution  and  laws 
within  ninety  days  after  the  enactment  of  the  same.  Printed  copies 
of  the  constitution  and  laws  and  of  additions  or  amendments  thereto, 
certified  by  the  secretary  or  corresponding  officer  of  the  association, 
shall  be  prima  facie  evidence  of  the  legal  adoption  thereof. 


894  FRATERNAL    SOCIETY   LAW 

Section  27.  That  every  association,  transacting  business  in  this 
State,  shall  annually,  on  or  before  the  first  day  of  ]\rareh,  file  with 
the  Insurance  Commissioner  in  such  form  as  he  may  require,  a  state- 
ment under  oath  of  its  president  and  secretary,  or  corresponding 
officers,  of  its  condition  and  standing  on  the  thirty-first  day  of  De- 
cember next  preceding  and  of  its  transactions  for  the  year  ending 
on  that  date,  and  shall  also,  furnish  such  other  information  as  the 
Insurance  Commissioner  may  deem  necessary  to  a  proper  exhibit  of 
its  business  and  plan  of  working,  The  Insurance  Commissioner  may 
at  other  times  require  any  further  statement  he  may  deem  necessary 
to  be  made  relating  to  such  associations.  But  such  Insurance  Com- 
missioner shall  neither  make  nor  permit  to  be  made  from  any  infor- 
mation so  obtained  any  valuation  of  its  outstanding  benefit  certifi- 
cates unless  requested  to  make  such  valuation  by  the  association. 

Section  28.  That  the  Insurance  Commissioner,  or  any  person  he 
may  appoint,  shall  have  the  power  of  visitation  and  examination  into 
the  affairs  of  any  domestic  association.  He  may  employ  assistants 
for  the  purpose  of  such  examination,  and  he,  or  any  person  he  may 
appoint,  shall  have  free  access  to  any  books,  papers  and  documents 
that  relate  to  the  business  of  the  association,  and  may  summon  and 
qualify  as  witnesses  under  oath,  and  examine  its  officers,  agents  and 
employes  or  other  persons  in  relation  to  the  affairs,  transactions  and 
condition  of  the  association.  The  expense  of  such  examination 
shall  be  paid  by  the  a.ssoeiation  examined,  but  the  amount  thereof 
shall  not  exceed  one  hundred  dollars. 

Whenever  after  examination  the  Insurance  Commissioner  is  satis- 
fied that  any  domestic  association  has  failed  to  comply  with  any 
provisions  of  this  law  or  is  exceeding  its  powers;  or  is  not  carrying 
out  its  contracts  in  good  faith;  or  is  transacting  business  fraudu- 
lently'; or  is  in  such  condition  as  to  render  further  proceedings  haz- 
ardous to  the  jniblic  or  its  certificate  holders;  or  whenever  any 
domestic  association,  after  the  existence  of  one  year  or  more,  shall 
have  a  membership  of  less  than  three  hundred,  or  votes  to  dis- 
continue business,  the  Insurance  Commissionci'  may  present  the  facts 
relative  thereto  to  the  State  Attorney  General,  who  shall,  if  he  deem 
the  circumstances  warrant,  commence  an  action  in  quo  warranto 
in  a  court  of  comjietent  jurisdiction,  and  such  court  shall  thereupon 


THE    STATE    OF    TENNEHtiEE  895 

notify  the  officers  of  sucli  association  of  a  liearing,  and,  unless  It 
shall  then  appear  that  some  special  and  pood  reason  exists  why  such 
assoeiation  should  not  be  closed,  said  association  shall  be  enjoined 
from  carrying  on  any  further  business,  and  some  ])frson  shall  be 
appointed  receiver  of  such  association,  and  shall  j)roeeed  at  once 
to  take  possession  of  the  books,  papei's,  moneys,  and  other  assets  of 
the  association,  and  shall  forthwith,  under  the  direction  of  the  court, 
proceed  to  close  the  affairs  of  the  association  and  to  distribute  its 
funds  to  those  entitled  tliereto.  No  such  proceeding  shall  be  com- 
menced bj'  the  State  Attorney  Cieneral  against  any  such  association 
until  after  notice  has  been  duly  sei'ved  on  the  chief  executive  officers 
of  the  association  and  a  reasonable  opportunity  given  to  it  on  a 
date  to  be  named  in  said  notice  to  show  cause  why  such  jiroceedings 
shotdd  not  be  commenced. 

Section  29.  That  no  action  or  proceeding  to  discontinue  or  enjoin, 
in  whole  or  in  part,  the  business  or  methods  of  any  such  domestic 
association,  or  to  appoint  a  receiver  therefor,  or  to  dissolve  the  same, 
or  in  any  manner  affecting  its  corporate  rights,  or  to  oust  any 
foreign  association,  or  enjoin  it  from  transacting  business  in  this 
State,  shall  be  entertained  by  any  court,  except  on  the  suit  of  the 
Attorney  General  of  this  State. 

Section  30.  That  the  Insurance  Commissioner,  or  anj^  person 
whom  he  may  appoint,  may  examine  any  foreign  association  trans- 
acting or  applying  for  admission  to  transact  business  in  this  State. 
The  Insurance  Commissioner  may  employ  assistants  for  the  purpose 
of  such  examination,  and  he,  or  any  person  he  may  aiipoiiit,  shall 
have  free  access  to  all  the  books,  papers  and  documents  that  relate 
to  the  business  of  the  association,  and  may  summon  and  qualify  as 
witnesses  under  oath  and  examine  its  officers,  agents,  employes  and 
other  persons  in  relation  to  the  affairs,  transactions  and  condition 
of  the  association.  He  may,  in  his  discretion,  accept  in  lieu  of  such 
examination  [the  examination]  of  the  insurance  department  of  the 
State,  territory,  district,  province  or  country  where  such  association 
is  organized.  All  examinations  made  under  the  provisions  of  this 
section  shall  be  made  at  the  expense  of  the  association  examined, 
but  the  expenses  of  any  examination  shall  not  exceed  two  hundred 
dollars. 


896  FRATERNAL    SOCIETY   LAW 

If  any  such  association  or  its  officers  refuse  to  submit  to  such  ex- 
amination, or  to  comply  with  the  provisions  of  this  section  relating 
thereto,  the  authority  of  such  association  to  transact  business  ia 
this  State  shall  be  revoked  until  satisfactory  evidence  is  furnished 
the  Insurance  Commissioner  relating  to  the  condition  and  affairs 
of  the  association,  and  during  such  revocation  the  association  shall 
not  transact  any  business  in  this  State. 

Section  31.  That  when  the  Insurance  Commissioner  on  investi- 
gation is  satisfied  that  any  foreign  association  transacting  business 
under  this  act  has  exceeded  its  powers,  or  has  failed  to  comply  with 
the  provisions  of  the  law,  or  is  conducting  business  fraudulently. 
or  is  not  carrying  out  its  contracts  in  good  faith,  or  is  in  such  con- 
dition as  to  render  further  proceedings  hazardous  to  the  public  or  its 
certificate  holders,  he  may  revoke  the  certificate  of  authority  granted 
to  it,  and  shall  cause  notification  thereof  to  be  published  in  one  or 
more  newspapers  of  general  circulation,  and  no  new  business  shall 
thereafter  be  done  by  it  or  its  agents  in  this  State  while  such  default 
or  (disability  continues,  nor  until  its  authority  to  do  business  is 
restored  by  the  Insurance  Commissioner;  provided  that  nothing  in 
this  act  shall  prevent  such  association  from  applying  to  a  court  of 
competent  jurisdiction,  by  mandamus  or  otherwise,  to  compel  said 
Insurance  Commissioner  to  issue  such  certificate,  if  such  court,  in  its 
discretion,  should  determine  that  said  association  was  entitled,  under 
the  law,  to  have  said  certificate  issued  to  it. 

Section  32.  That  nothing  contained  in  this  act  shall  lie  construed 
to  affect  or  apply  to  grand  or  subordinate  lodges  of  JMasons.  Odd 
Fellows  or  Knights  of  Pythias  (exclusive  of  the  insurance  liriinch 
of  the  Supreme  Lodge  Knights  of  Pythias),  or  to  similar  orders 
which  do  not  issue  insurance  certificates,  nor  to  local  lodges  of  an 
association  now  doing  business  in  this  State,  that  provide  death 
benefits  not  exceeding  three  hundred  dollars  to  any  one  person,  or 
disability  benefits  not  exceeding  three  hundred  dollars  in  any  one 
year  to  any  one  person,  or  both;  nor  to  domestic  associations  v.'hich 
limit  their  membership  to  the  employes  of  a  particular  city  or  town, 
designated  firm,  business  house  or  corjioration.  The  Insurance  Com- 
missioner may  require  from  any  association  such  information  as 
will  enable  him  to  determine  whether  such  association   is  exempt 


THE    STATE    OF    TENNESSEE  897 

from  the  provisions  of  this  act.  No  association  which  is  exempt  by 
the  provisions  of  this  section  from  the  requirements  of  this  act  shall 
give  or  allow,  or  promise  to  give  or  allow,  to  any  person  any  com- 
pensation for  procuring  new  members. 

Section  33.  That  associations  coming  within  the  definition  of  fra- 
ternal beneficiary  associations  as  defined  by  this  Act,  and  now  trans- 
acting business  as  fraternal  beneficiary  associations,  organized  prior 
to  Anno  Domini  1900,  and  authorized  to  do  business  in  this  State 
prior  to  and  at  the  time  of  the  passage  of  this  Act,  and  which  shall 
have  established  or  may  hereafter  establish  rates  deemed  by  it  ade- 
quate to  perpetuate  its  existence  or  meet  its  obligations,  and  in  so 
doing  has  increased  or  shall  increase  the  payments  required  to  be 
made  by  any  member,  so  that  such  member  shall  be  unable  for  any 
reason  to  make  such  payment  and  continue  his  membership,  in  such 
case  or  cases  any  such  association  may  make  such  allowance  to  such 
member  or  members,  by  way  of  extended  insurance,  or  reduced 
benefit  payable  to  a  beneficiary  designated  in  accordance  with  the 
provisions  of  Section  6  of  this  Act  as  it  may  determine  to  be 
equitable  and  provided  for  by  the  laws  and  regulations,  and  may 
provide  for  paying  the  cost  of  carrying  such  extended  insurance 
out  of  any  reserve,  emergenc.v,  surplus  or  other  fund  it  has  or  shall 
accumulate  or  create. 

The  provisions  of  this  section  shall  not  be  construed  as  appli- 
cable to  any  association  which  does  not  make  provision  for  such 
extended  insurance  in  its  laws  or  regulations,  nor  shall  the  mem- 
bers of  any  association  which  does  not,  by  its  laws  or  regulations, 
make  provision  for  such  extended  insurance,  have  any  right  to  or 
interest  in  any  fund  which  any  such  association  may  have  now  or 
may  hereafter  create,  either  as  a  reserve,  emergency,  surplus  or 
other  fund. 

Section  34.  That  such  associations  shall  not  employ  paid  agents 
in  soliciting  or  procuring  members,  except  in  the  organization  or 
building  up  of  subordinate  bodies,  or  granting  members  inducements 
to  procure  new  members. 

Section  35.  That  each  and  every  certificate  issued  by  any  asso- 
ciation operating  under  the  provisions  of  this  Act  shall  be  incon- 
testable on  account  of  erroneous  or  innocent  statements  made  in  the 


898  FRATERNAL    SOCIETY    LAW 

application  as  to  age,  provided  the  member  was  within  the  age  lim- 
ited for  membership  at  the  time  of  the  application ;  and  provided, 
further,  that  in  the  settlement  of  any  loss,  where  there  was  an  error 
as  to  age,  such  settlement  shall  be  made  on  the  basis  of  the  correct 
age.  But  no  association  operating  under  the  provisions  of  this  Act 
shall  contest  the  age  of  any  member  after  his  death  unless  the  itroof 
offered  by  the  beneficiary  shows  the  age  of  the  deceased  member  to 
be  different  from  that  given  in  his  application ;  then  the  correct  age 
may  be  ascertained  and  settlement  made  as  herein  provided. 

Section  36.  That  any  person,  officer,  member  or  examining  physi- 
cian, who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent 
statement  or  representation  in  or  with  reference  to  any  application 
for  membership,  or  for  the  purpose  of  obtaining  money  from  or 
benefit  in  anj-  association  transacting  business  under  this  Act,  shall 
be  guilty  of  a  misdemeanor,  and  upon  conviction  thereof  shall  be 
punished  by  a  fine  of  not  less  than  one  hundred  dollars  nor  more 
than  five  hundred  dollars,  or  imprisonment  in  the  county  jail  for  not 
less  than  thirty  days  nor  more  than  one  year,  or  both,  in  the  discre- 
tion of  the  court ;  and  any  person  who  shall  wilfully  make  a  false 
statement  of  any  material  fact  or  thing  in  a  sworn  statement  as  to 
the  death  or  disability  of  a  certificate  holder  in  any  such  association, 
for  the  purpose  of  procuring  payment  of  a  benefit  named  in  the 
certificate  of  such  holder,  and  any  person  who  shall  wilfully  make 
any  false  statement  in  any  verified  report  or  declaration  under 
oath  required  or  authorized  by  this  Act,  shall  be  guilty  of  perjury, 
and  shall  be  proceeded  against  and  punished  as  provided  by  the 
statutes  of  this  State  in  relation  to  the  crime  of  perjurJ^  Any  person 
who  shall  solicit  membership  for.  or  in  any  manner  assist  in  procur- 
.ing  membership  in,  any  association  not  licensed  to  do  business  in 
this  State,  or  who  shall  solicit  membership  for.  or  in  any  manner 
assist  in  procuring  membership  in  any  such  association  not  aiithor- 
ized  as  herein  provided,  to  do  business  as  herein  defined  in  this 
State,  shall  be  P'uilty  of  a  misdemeanor,  and  upon  conviction  thereof 
shall  be  punished  by  a  fine  of  not  less  than  fifty  nor  more  than  two 
hundred  dollars.  Any  association,  or  any  officer,  agent  or  employe 
thereof,  neglecting  or  refusing  to  comply  with,  or  violating  any  of 
the  provisions  of  this  Act,  the  penalty  for  which  neglect,  refusal  or 


THE    STATE    OF    TENNESSEE  899 

violatiou  is  not  specified  in  this  section,  kIkiII  be  fined  not  exceeding 
two  hundred  dollars  upon  conviction  thereof. 

Section  37.  That  the  word  "association."  as  used  in  tiiis  act, 
shall  be  taken  and  eonstiMied  as  iiicaninii:  a  fratiTiial  beneficiary  cor- 
poration, society,  order  or  voluntary  association  as  defined  by  this 
Act.  The  words  "domestic  association"  shall  be  taken  and  con- 
strued as  meaning  an  association  organized  or  incorporated  under 
the  laws  of  this  State.  The  words  "foreign  association"  shall  be 
taken  and  constiiied  as  meaning  an  association  organized  or  incor- 
porated under  the  laws  of  another  State,  territory,  district,  province 
or  country.  The  word  "State,"  as  used  in  this  act,  shall  be  taken 
and  construed  as  meaning  "State,"  "Territory,"  "District," 
"Country"  or  "Province."  All  provisions  of  each  section  of  this 
Act  except  as  otherwise  provided  shall  be  taken  and  construed  as 
applying  to  both  domestic  and  foreign  associations. 

In  the  event  of  a  vacancy  in  the  office  of  the  Insurance  Commis- 
sioner, or  in  the  absence  or  disability  of  that  officer,  the  Deputy 
Insurance  Commiss-iouer  shall  perform  all  the  duties  required  of  the 
Insurance  Commissioner  by  this  Act. 

Section  38.  That  nothing  contained  in  this  Act  shall  be  con- 
strued to  require  any  society  to  make  or  cause  to  be  made  any  valu- 
ation of  its  benefit  certificates  for  any  purpose  whatever,  nor  shall 
the  Insurance  Department  have  the  right  to  require  or  demand  that 
such  valuation  be  made  or  embraced  in  the  report  of  any  fraternal 
beneficiary  society  to  the  insurance  department. 

Section  39.  That  Chapter  113,  Acts  of  1901,  passed  March  22, 
1901,  and  approved  April  13,  1901,  and  all  other  laws  and  parts  of 
laws  in  conflict  with  the  provisions  of  this  Act,  be  and  the  same  are 
hereby  repealed. 

Section  40.  That  this  Act  take  efi'ect  from  and  after  its  passage, 
the  public  welfare  requiring  it. 

Passed  April  14,  1905.    Approved  April  17,  1905. 

Conditions  Precedent  to. 
Where  a  certificate  is  issued  to  a  member  and  accepted  by  him 


900  FRATERNAL    SOCIETY    LAW 

subject  to  the  conditions  named  on  the  back  thereof  and  in  the 
application  and  in  the  laws,  such  conditions  will  be  enforced. 

Deacon  vs.  Clarke,  Dec.  1903,  112  Tenn.  2S9. 

Evidence  as  to  Age  and  Pedigree. 

In  matters  relating  to  age  and  pedigree,  inscriptions  on  tomb- 
stones and  on  family  portraits  and  charts,  engravings  on  rings, 
and  hear-say  evidence  generally,  are  admissible,  and  public  registers 
are  competent  evidence  in  this  class  of  cases. 

Murray  vs.  Supreme  Hive,  Ladles  of  the  Maccabees,  April,  1904,  112 
Tenn.  664. 

Evidence — What  is  Competent  as  to  Age. 

Copies  of  the  British  census  report  and  of  answers  made  to  the 
United  States  census  enumerator,  records  of  boards  of  health,  and 
applications  for  life  insurance  are  admissible  and  competent  as  to 
age  and  pedigree. 

Murray  vs.  Supreme  Hive.  Ladies  of  the  Maccabees,  April,  1904,  112 
Tenn.  664. 

Expulsion — Latitude  Allowed  Societies. 

Fraternal  societies  must  of  necessity  determine  as  to  the  com- 
petency and  weight  of  evidence  in  expulsion  proceedings,  in  pur- 
suance of  their  own  rules  and  laws,  and  where  the  expelled  member 
institutes  suit  to  lie  reinstated,  the  only  question  to  be  considered 
by  the  court  is  whether  the  laws  of  the  society  were  enforced  fairly 
and  without  oppression. 

Murray  vs.  Supreme  Hive,  Ladies  of  the  Maccabees,  April,  1904,  112 
Tenn.   664. 

Insanity  of  Member  No  Bar  to  Right  of  Society  to  Affect  His  Con- 
tract by  Legislation. 

Where  a  society  is  entitled  under  its  laws  to  raise  its  assessment 


THE    STATE    OF    TENNESSEE  <)()1 

rates,  a  member  was  bound  by  the  legal  aud  reasonable  action  ol 
the  society  in  so  doing,  though  \w  was  insane  at  the  time. 

Conner  vs.  Supreme  Commandery  Golden  Cross,   Supreme  Court  of 
Tenn.,  Oct.,  1906,  97  S.  W.  306. 

After-enacted  Laws — Increasing  Rates  of  the  Members  Valid. 

The  increase  of  a  member's  rates  from  $52.08  per  annum  to 
$144.00  per  annum  is  held  not  to  be  unreasonable,  under  the  facts 
set  out  in  the  ease.  Upon  the  right  of  a  society  to  raise  the  rates  of 
its  members  who  had  been  in  the  society  for  a  long  time  and  apply 
new  rates  at  their  attained  ages,  the  following  was  said  by  the 
court : 

"The  assured  had  carried  insurance  for  a  long  series  of  years  at 
less  than  cost.  He  was  required  to  pay  the  same  rate  as  all  other 
members  in  his  class — that  is,  those  of  the  same  age  and  holding  the 
same  kind  of  policy.  The  end  aimed  at  by  the  company  was  to  make 
each  member  pay  according  to  the  cost  of  his  insurance,  and  while 
this  could  not  be  ascertained  with  mathematical  exactness,  still  this 
was  the  object  in  view.  The  chief  complaint  seems  to  be  that  other, 
younger  men  were  not  raised  so  much  in  their  assessments,  and 
some  were  even  reduced,  but  this  was  the  result  of  making  the 
basis  of  assessment  the  age  of  the  member  and  the  estimated  cost 
of  his  insurance.  It  was  evident  that  the  old  plan  was  a  failure,  and 
the  Court  of  Chancery  Appeals  report  that  some  change  in  the 
assessment  plan  was  necessary  to  accomplish  the  ob,iects  and  pur- 
poses of  the  order  and  save  it  from  dissolution.  It  must  be  evident 
that  the  younger  men  would  not  be  burdened  with  a  heavy  cost  of 
insurance  upon  the  older  ones,  and  they  would  not  join  the  order 
and  would  withdraw  if  such  a  rule  was  attempted,  and  this  would 
leave  the  older  men  with  no  one  but  the  old  ones  upon  whom  to 
rely  for  their  protection.  As  we  view  it,  the  effect  of  this  rule  was 
only  to  accentuate  the  disabilities  of  age  after  the  insured  had 
enjoyed  indemnity  for  many  years  at  less  than  cost,  and  we  cannot 
see  that  the  basis  of  assessments  was  vmreasonable. " 

Conner  vs.  Supreme  Commandery  Golden  Cross,   Supreme   Court  of 
Tenn.,  Oct.,  1906,  97  S.  W.  306 


902  FRATERNAL    SOCIETY    LAW 

Contracts  of  Members,  of  What  Composed. 

The  laws  of  a  societj',  when  pertinent  and  not  in  conflict  with  the 
statute  laws  or  the  recognized  rules  of  public  policy,  become  part 
of  the  contracts  of  the  societies  with  their  members. 

Supreme  Lodge,   Knights   of   Pythias  vs.   La  Malta,   June,   1895,   95 
Tenn.  157. 

After-enacted  Laws  Valid. 

A  valid  law  passed  by  a  fratei'nal  society  after  the  filing  of  an 
application  for  membership  and  issuance  of  a  certificate,  and  before 
the  death  of  the  member,  is  operative  against  him  and  his  bene- 
ficiaries to  defeat  their  rights,  where  in  his  application  he  agreed 
to  conform  to  the  rules  then  in  force  or  which  might  thereafter  be 
enacted,  and  such  obedience  is  made  a  condition  of  the  issuance 
of  the  certificate. 

Supreme   Lodge,   Knights  of  Pythias  vs.   La   Malta,   June,   1S95,   95 
Tenn.  157. 

Legislative  Power  Cannot  be  Delegated. 

The  supreme  lodge  of  a  fraternal  society  in  which  is  vested  by 
the  charter  the  sole  power  to  legislate  with  respect  to  the  bene- 
ficiary fund,  cannot  legally  delegate  to  a  board  of  control  the  power 
to  pass  a  general  law  against  suicide  affecting  the  entire  beneficiary 
membership. 

Supreme  Lodge,  K.  of  P.  vs.  La  Malta,  June,  1895,  95  Tenn.  157. 

Warranty,  Good  Faith  of  Declarations. 

An  applicant  for  insurance,  though  warranting  the  truth  of  state- 
ments and  answers  made  to  the  medical  examiner,  is  not  required 
to  know  and  state  in  his  application  with  absolute  certainty  his  real 
physical  condition  and  a  j)redisposition  to  certain  diseases,  but  it  is 
sufficient  if  he  in  good  faith  discloses  fully  and  truthfully  all  that 
he  knows  about  his  past  and  present  health. 

Knights  of  Pythias  vs.  Cogbill,  April,  1897,  99  Tenn.  28. 


THE    STATE    OF    TENNESSEE  903 

Agency  of  Medical  Examiner. 

A  physician  who  acts  as  medical  examiner  for  a  society  wliich 
accepts  or  ratifies  his  examination  will  be  regarded  as  the  agent  of 
the  society  instead  of  the  member  in  the  making  of  such  examina- 
tion, although  the  examiner  nuiy  not  have  b(;en  appointed  by  the 
society,  and  although  the  application  recites  that  the  examiner  shall 
be  held  to  be  the  agent  of  the  applicant. 

Knights  of  Pythias  vs.  Cogbill.  April,  1897,  99  Tenn.  28. 

Application,  What  Must  be  Stated  in  by  Applicant. 

In  the  absence  of  specific  and  direct  inquiries,  the  applicant  need 
not  disclose  very  slight  and  temporary  illness,  but  only  those  more 
serious  attacks  which  have  in  some  degree  affected  unfavorably  his 
general  health  or  constitution. 

Knights  of  Pythias  vs.  Cogbill,  April,  1897,  99  Tenn.  28. 

Beneficiaries,  Who  May  Be,  Rights  of  Assignee. 

An  assignment  by  a  member  of  a  society  of  a  certificate  payable 
to  himself,  issued  in  place  of  the  original  certificate  which  was  pay- 
able to  his  wife,  in  pursuance  of  an  agreement  that  the  assignee, 
who  was  in  no  way  related  to  or  interested  in  the  continuance  of 
the  life  of  the  member,  should  pay  to  him  the  amount  already  paid 
by  him  and  assume  and  pay  all  subseqvieut  assessments,  is  void  as 
against  public  policy,  and  the  original  beneficiary  may  recover  from 
the  assignee  in  such  a  certificate,  who  has  collected  the  insurance 
thereunder,  the  difference  between  such  an  amount  and  the  money 
actually  paid  by  the  assignee  in  keeping  the  insurance  alive. 

Qulnn  vs.  Cath.  Knights,  May,  1897,  99  Tenn.  SO. 

Beneficiaxy,  Vested  Interests,  Etc. 

The  beneficiary  named  in  a  certificate  issued  by  a  society  on  the 
life  of  a  member  acquires  no  vested  interest  or  right  to  the  benefit, 


904  FRATERNAL    SOCIETY    LAW 

but  a  mere  expectancy,  revocable  at  pleasure  of  the  member,  when 
under  the  laws  of  the  society  he  has  the  right  to  surrender  his  cer- 
tificate and  take  out  another. 

Lane  vs.  Lane,  Oct.,  1897,  99  Tenn.  639. 

Forfeiture — No  Presumptions  of  Legality  as  to  Assessments  Levied. 

To  defeat  an  action  upon  a  certificate  on  account  of  non-payment 
of  assessments,  it  must  be  affirmatively  and  distinctly  proved  that 
the  assessment  which  the  member  failed  to  pay  was  made  in  exact 
accord  with  the  laws  of  the  society,  and  no  presumption  will  be  in- 
dulged in  such  a  case  in  favor  of  the  regularity  or  legality  of  the 
assessment. 

Stewart  vs.  Grand  Lodge,  Jan.,  1S9S,  100  Tenn.  267. 

Beneficiary,  Right  of  Change  Absolute. 

A  member  in  a  fraternal  society  may  change  his  beneficiary  when- 
ever and  in  whatever  manner  he  may  desire,  within  the  rules  of  the 
order.  Such  rules  are  designed  for  the  protection  of  the  order,  and 
if  waived  by  it,  their  non-observance  is  not  available  to  others. 

Schardt  vs.  Schardt,  Jan.,  1S98,  100  Tenn.  276. 

Beneficiary  Named  Not  Affected  by  Member's  Will. 

A  member  cannot  directly  or  indirectly  dispose  of  his  certificate 
by  will  so  as  to  defeat  or  afi'ect  the  rights  of  the  beneficiaries  named 
therein. 

Schardt  vs.  Schardt,  Jan.,  1S98,  100  Tenn.  276. 

Beneficiary  Not  Authorized,  Void. 

A  benefit  certificate  that  names  as  beneficiary  a  person  not  au- 
thorized by  the  charter  and  laws  of  the  society  to  receive  the  benefit, 
is  void. 

Ownby  vs.  Supreme  Lodge  Knights  of  Honor.   April,  1898,  101  Tenn. 
16. 


/ 


THE    STATE    OF     TENNESSEE  905 

Beneficiary — Dependency,  What  is  ? 

A  benefit  certificate. ill  favor  of  one  for  whom  the  member  is  under 
no  legal  or  moral  obligation  to  provide,  cannot  be  sustained  as  being 
for  a  person  dependent  upon  the  member,  although  the  latter  may 
have  bestowed  gifts  or  charities  upon  such  person  and  had  con- 
templated or  promised  to  bestow  others. 

Ownby  vs.  Supreme  Lodge  Knights  of  Honor.  April,  1S9S,  101  Tenn. 
16. 

Beneficiary  Designation  by  Member  Insane,  Void. 

The  surrender  of  a  certificate  and  substitution  of  a  new  one 
naming  a  different  beneficiary  made  by  a  member  incapable,  by 
reason  of  mental  infirmity,  of  exercising  judgment  and  discretion,  is 
void  and  does  not  defeat  the  rights  of  the  beneficiaries  named  in  the 
first  certificate. 

Ownby  vs.  Supreme  Lodge  Knights  of  Honor,  April,  189S,  101  Tenn. 
16. 

Forfeiture,  Waiver — Course  of  Dealing. 

The  insurer  is  estopped  to  claim  forfeiture  of  a  life  insurance  con- 
tract for  non-payment  of  dues  where  it,  through  a  long-continued 
and  uniform  course  of  dealing  with  the  member,  had  not  exacted 
punctual  payment  of  the  dues,  but  permitted  the  member  to  pay 
upon  notice  or  demand  and  accepted  such  payments  though  made 
after  maturity,  without  objection ;  provided  the  particular  dues  for 
the  non-payment  of  which  forfeiture  is  claimed  were  paid  or  ten- 
dered within  reasonable  time  after  such  notice  or  demand  and  in 
reasonable  conformity  to  such  course  of  dealing. 

Insurance  Co.  vs.  Hyde,  Oct.,  1898,  101  Tenn.  396. 

Forfeiture,  Prerequisites  to  Enforcing. 

Before  non-payment  of  an  amount  which  under  the  terms  of  the 
contract  must  be  ascertained  and  fixed  by  assessment,  can  be  sue- 


906  FRATERNAL    SOCIETY    LAW 

eessfully  relied  ou  as  a  ground  for  forfeiting  the  policy,  the  insurer 
must  plead  and  prove  that  the  assessment  had  been  duly  made  in 
accordance  with  the  charter  and  by-laws  of  the  society  aad  the 
terms  of  the  contract. 

Insurance  Co.  vs.  Hyde,  Oct.,  1898,  101  Tenn.  396. 

Warranty,  Rvde  Respecting. 

*  *  *  A  eertilicate  conditioned  upon  the  truth  of  the  assured 's 
answers  and  representations  contained  in  his  application  and  in  the 
report  of  the  medical  examiner  will  be  vitiated  alike  by  any  mis- 
statement of  fact  whether  made  wilfully  and  with  knowledge  of  its 
falsity  or  in  good  faith  through  ignorance  of  the  truth;  but  as  to 
matters  of  opinion,  it  is  sufficient  if  the  statement  was  made  in  good 
faith  and  on  the  best  information  had  or  obtainable." 

Knights  of  Honor  vs.  Dickson,  April,  1899,  102  Tenn,  255. 

Warranty  as  to  Age  Stated  in  the  Application. 

The  statement  as  to  the  applicant's  true  age  made  in  an  applica- 
tion for  membership  which  declares  that  the  statements  and  repre- 
sentations made  therein  shall  be  the  basis  of  the  contract,  is  a  part 
of  the  contract  although  the  same  is  not  incorporated  and  referred 
to  in  the  certificate  issued. 

McCarthy  vs.  Cath.  Knights,  April,  1899,  102  Tenn.  345. 

Warranty  as  to  Age  Waived. 

A  misstatement  as  to  the  applicant's  age  in  an  application  which 
is  made  a  part  of  the  contract  will  not  defeat  a  recovery  notwith- 
standing that  contrarj^  to  the  statement  the  applicant  had  passed 
the  age  limit  prescribed  by  the  laws  of  the  society,  where  the  appli- 
cant did  not  know  her  exact  age,  and  where  the  application  was 
made  out  on  one  of  the  society's  blanks — presumably  by  some  of 
its  officers  or  members — and  the  date  and  place  of  her  birth  were  not 
filled  in  the  blanks,  and  the  facts  as  to  her  character  and  age  were, 


THE     STATE    OF     TENNESSEE  007 

under  the  provisions  of  the  laws  referred  to  a  committee  upon  whose 
report  a  certificate  was  issued,  ujjon  which  dues  were  paid  for 
nearly  seven  years. 

McCarthy  vs.  Cath.  Knights,  April,  1S99,  102  Tenn.  345. 

Warranty  Under  Reinstatement  Application. 

False  statements  of  the  iiicinbor  in  a  health  certificate  upon  the 
faith  of  which  a  lapsed  contract  has  been  renewed,  to  the  effect  that 
he  had  not  had  certain  diseases  or  consulted  a  physician  during 
the  lapse  period,  will  not  render  the  contract  void  unless  the  dis- 
eases with  which  he  was  afflicted  were  permanent  and  habitual,  indi- 
cating some  vice  in  the  constitution  and  having  some  bearing  upon 
the  general  health  and  continuance  of  life.  Mere  temporai-y  ail- 
ments that  are  curable  and  pass  away  will  iidt  suffice. 

Woodward  vs.  Insurance  Co.,  Jan.,  1900,  104  Tenn.  49. 

Forfeiture  Through  Vices  or  Habits. 

Forfeiture  of  a  contract  on  account  of  the  use  of  forbidden  drugs, 
causing  impairment  of  health  and  hastening  death,  does  not  occur 
where  such  drugs  were  used  by  the  member  as  an  invalid  under  the 
advice  of  a  physician  and  in  good  faith  as  a  medicine,  and  in  such 
quantities  and  manner  as  they  were  prescribed. 

Knights  of  Pythias  vs.  Allen,  May,  1900,  104  Tenn.  623. 

Certificate  Issued  After  Applicant's  Death  Void. 

A  benefit  certificate  which  is  signed  and  delivered  after  the  death 
of  the  applicant  is  void,  no  matter  how  long  the  application  for  it 
had  been  pending,  or  what  other  steps  had  been  taken  to  mature 
and  perfect  it,  where  the  liability  of  the  society  is  conditioned  by 
the  terms  of  the  contract  upon  delivery  of  the  certificate  to  the  ap- 
plicant while  living  and  in  good  health. 

McLendon  vs.  Woodmen  of  the  World.  April,  1901.  106  Tenn.  695. 


908  FRATERNAL    SOCIETY    LAW 

Contract,  of  What  Composed. 

The  application,  with  the  constitution  and  laws  of  the  society, 
constitute  the  basis  of  its  contract  and  ai-e  parts  of  it  as  fully  as  if 
copied  into  same,  where  they  are  referred  to  and  declared  such  on 
the  face  of  the  certificate. 

McLendon  vs.  Woodmen  of  the  World,  April,  1901,  106  Tenn.  695. 

Application,  Delay  in  Acting  Upon,  Not  Actionable. 

Mere  delay  of  a  society  in  passing  upon  an  application  for  a 
benefit  certificate  gives  no  rights  to  the  applicant,  and  does  not 
afford  any  presumption  of  acceptance  of  the  application. 

McLendon  vs.  Woodmen  of  the  World,  April,  1901,  106  Tenn.  695. 

Beneficiary,  Right  of  Mother  Against  Wife. 

For  the  facts  in  a  case  where  the  mother  was  held  to  be  the  bene- 
ficiary in  a  certificate  taken  out  after  a  member's  marriage,  and  in 
a  contest  between  the  mother  and  the  wife,  see 

Manley  vs.  Manley,  May,  1901,  107  Tenn.  191. 

Agency  of  Medical  Examiner  Limited. 

While  the  medical  examiner  is  an  agent  with  limited  powers, 
nevertheless,  his  acts  in  and  about  business  entrusted  to  his  care 
are  binding,  within  the  scope  of  his  authority,  upon  the  society. 

Bennett  vs.  Mass.  Mut.  Life  Ins.  Co.,  June,  1901,  107  Tenn.  371. 

After-enacted  Law  Cutting  Down  Benefit  Ultra  Vires. 

A  clause  in  the  contract  by  which  the  member  agrees  to  conform 
in  all  respects  to  the  laws,  rules  and  usages  of  the  order,  now  in 
force  or  which  may  hereafter  be  adopted  by  the  society,  does  not 
give  to  the  society  the  power  to  reduce,  by  amendment  of  its  laws 
or  otherwise,  without  the  member's  express  consent,  the  amount 


THE     STATE    OF     TENNESSEE  »09 

payable  in  his  certificate.  Such  by-law  is  ultra  vires  and  void.  The 
reserved  right  of  legislation  under  such  contract  is  one  of  preserva- 
tion and  not  of  destruction  of  the  insurance  contract. 


y  F 


Gaut  vs.  Am.  Legion  of  Honor,  Oct.,  1901,  107  Tenn.  603. 
Forfeiture — Waiver  by  Custom  of  Dealing. 


It  is  well  settled  that  an  insurance  company  can  and  ought  to  be 
estopped  from  insisting  upon  a  forfeiture  for  non-payment  of  the 
premiums  when  due,  when  by  any  course  of  action,  representation 
or  dealing  the  assured  has  been  led  to  believe  that  by  conformity 
thereto  a  forfeiture  of  the  contract  will  not  bo  incurred,  followed 
by  due  conformity  on  his  part. 

Aetna  Life  Ins.   Co.  vs.   Fallow,  April,  1903,  110  Tenn.  720. 

Construction  of  Repugnant  Provisions  of  Contracts. 

Where  two  clauses  of  a  contract  are  so  totally  repugnant  that 
they  cannot  stand  together,  the  first  governs  rather  than  the  last, 
and  especially  should  this  rule  of  construction  prevail  when  it  ap- 
pears that  the  first  clause  expresses  the  chief  object  and  purposes 
of  the  contract. 

Bean  vs.  Aetna  Life  Ins.  Co.,  Sept.,  1903,  111  Tenn.  186. 

Consolidation  of  Suits  on  One  Certificate. 

Two  suits  by  different  beneficiaries  against  a  benefit  society  on 
the  same  certificate  are  properly  consolidated  where  this  brings  all 
the  matters  and  parties  against  the  society  before  the  court  in  such 
shape  that  the  rights  of  the  parties  against  the  society,  and  as  be- 
tween themselves,  may  be  adjusted  in  the  one  consolidated  suit. 

Clement  vs.  Clement,  and  Clement   vs.  Supreme  Lodge,   Knights  of 
Pythias,  April,  1904,  113  Tenn.  40. 

After-enacted  Law  Valid. 

A  by-law  of  a  society  made  after  a  certificate  is  issued  and  before 


910  FRATERNAL    SOCIETY    LAW 

a  substitute  certificate  is  issued,  providing  that  only  a  proportionate 
part  of  the  insurance  should  be  paid  in  case  of  suicide  of  the  mem- 
ber, enters  into  the  substitute  certificate  and  becomes  a  part  of  the 
contract  between  the  parties,  such  by-law  being  reasonable,  valid 
and  enforcible. 

Clement  vs.  Clement,  and  Clement  vs.  Supreme  Lodge,  Knights  of 
Pythias,  April,  1904,  113  Tenn.  40. 

Suicide  or  Death  by  Reckless  Use  of  Drugs. 

For  the  facts  in  a  ease  where  the  Court  said:  "The  evidence,  as 
we  see  it,  shows  either  intention  to  commit  suicide,  or  such  a  reck- 
less use  of  the  deadly  drug  as  the  assured  knew  or  must  have  known 
would  produce  death,"  see 

Clement  vs.  Clement,  and  Clement  vs.  Supreme  Lodge,  Knights  of 
Pythias,  April,  1904,  113  Tenn.  40. 

Certificate,  When  Surrendered,  is  Dead. 

Where  a  certificate  in  a  mutual  benefit  society  was  surrendered 
b}'  the  member  in  his  lifetime  and  another  certificate  issued  in  favor 
of  a  different  beneficiary,  the  original  certificate  becomes  functus 
officio. 

Alfsen  vs.  Crouch,  Sept.,  1905,  11.5  Tenn.  352. 

Beneficiaries,  Provisions  Respecting  May  be  Waived. 

The  provision  in  the  laws  of  a  society  limiting  persons  who  may 
be  made  beneficiaries  in  certificates  issued  by  it,  may  be  waived  by 
the  society. 

Alfsen  vs.  Crouch,  Sept.,  1905,  115  Tenn.  352. 

Forfeiture  Provisions  Self-executing. 

Where  a  life  insurance  contract  provides  that  it  shall  lapse  and 
be  void   if  the  ])r(>niimns  thereunder  are  not  paid  Avheu  due,  it  Is 


THE     STATE    OF     TENNESSEE  911 

well  settled  that  the  contract  is  forfeited  if  the  premiums  are  not 
paid  as  stipulated. 

Pacific  Mut.  Life  Ins.  Co.  vs.  Galbraith,  Sept.,  1905,  115  Tenn.  471. 

Forfeiture,  Waiver  by  Course  of  Dealing. 

\/  Where  a  contract  contains  a  stipulation  that  non-payment  of 
l)r('niiums  when  due  shall  work  a  forfeiture  of  the  contract,  mere 
voluntary  indulgence  in  the  payment  of  a  particular  premium,  and 
without  agreement  for  like  indulgence  in  respect  of  future  pre- 
miums, or  a  course  of  dealing  implying  such  an  agreement,  does  not 
constitute  a  waiver  of  forfeiture  for  failure  to  pay  premiums  when 
due. 

Thompson  vs.  Fidelity  Mut.  Life  Ins.  Co.,  April,  1906,  116  Tenn.  557. 

Assessments,  When  Right  to  Levy  Limited. 

A  contract  provided  that  while  the  rates  specified  therein  were 
not  fixed,  it  was  believed  that  such  rates  would  never  be  exceeded, 
and  that  if  any  imexpected  emergency  should  arise  whereby  the 
mortuary  and  reserve  fund  should  become  exhausted,  then  in  such 
case  only  it  was  agreed  that  the  certificate  holder  .should  be  liable 
for  such  further  assessments  as  would  he  necessary  to  meet  the 
emergency  and  maintain  the  solvency  of  the  society.  Held,  That  the 
society  had  no  power,  under  the  contract  nor  under  the  law,  to  in- 
crease the  rates  on  existing  insurance  except  in  the  case  of  an 
emergency  so  specified:  and  where  rates  under  such  a  contract  were 
illegally  increased,  the  members  were  not  bound  to  pay  them  to 
prevent  a  forfeiture. 

Hicks  vs.   Northwestern   Aid   Assn.,   Supreme   Ct.   Tenn.,  Oct.,   1906, 
96  S.  W.  962. 

Assessments,  When  Tenders  of  Are  Waived. 

"Where  a  society,  after  illegally  raising  its  rates,  wholly  changed 
its  plan  of  business,  basing  it  on  the  new  sebedxde.  and  the  society 


912  FRATERNAL    SOCIETY    LAW 

insists  ou  payment  of  the  new  rates  by  an  old  member  who  was  will- 
ing to  pay  his  contract  rate,  a  tender  of  such  rate  was  waived. 

Hicks  vs.   Northwestern  Aid  Assn.,   Supreme   Ct.   Tenn.,  Oct.,   1906, 
96  S.  W.  962. 

Beneficiaries,  Death  of,  How  the  Fund  is  Affected  Thereby. 

The  by-laws  of  a  society  provided  that  members  might  change 
their  beneficiaries  on  application  accompanied  by  the  consent  of  the 
original  beneficiary  and  surrender  of  the  original  certificate.  A  cer- 
tificate was  issued  to  a  member  for  the  benefit  of  his  sister,  who  died 
before  the  member.  The  member  made  no  change,  and  at  his  death 
the  certificate  originally  issued  was  in  force.  Held,  That  the  fund 
passed,  under  the  statute  of  distribution,  to  the  distributees  of  the 
sister's  estate. 

Simms  vs.  Randall,  Supreme  Ct.  Tenn.,  Oct.,  1906,  96  S.  W.  971. 

Jurisdiction  of  Courts  Over  Foreign  Societies. 

A  non-resident  may  sue  a  foreign  company  legally  doing  business 
in  the  State  on  a  contract  written  outside  the  State,  though  the 
cause  of  action  occurred  outside  the  State. 

Patton  vs.  Continental  Casualty  Co.,  Supreme  Ct.  Tenn.,  Sept.,  1907, 
104  S.  W.  305. 


THE    UTATE    OF    TEXAS  913 


THE 

STATE  OF  TEXAS. 

CHAPTER  44. 

(The  Section  numbers  employed  correspond  to  those  in  the  Insi:r- 
ance  Code  of  1907  issued  by  the  Insurance  Commissioner  of  Texas.) 

Lodge  System — Ritualistic  Form  of  Work — Government  to  be  Rep- 
resentative— Payment  of  Death  Benefits. 

Section  188.  A  fraternal  beneficiary  association  is  hereby  de- 
clared to  be  a  corporation,  society  or  voluntary  association,  formed 
or  organized  and  carried  on  for  the  sole  benefit- of  its  members  and 
the  beneficiaries,  and  not  for  profit,  or  that  issues  benefit  certificates 
to  such  of  its  members  only  as  may  apply  therefor,  and  that  main- 
tain a  separate  branch  composed  of  the  members  who  hold  such 
certificates  issued  and  governed  by  or  through  a  separate  board  of 
management,  authorized  and  appointed  by  such  corporation,  society 
or  association  for  the  sole  purpose  of  managing  and  conducting  such 
branch.  Bach  association  shall  have  a  lodge  system  with  ritualistic 
form  of  work  and  elective  representative  form  of  government,  and 
shall  make  provision  for  the  payment  of  benefits  in  case  of  death, 
and  may  make  provision  for  the  payment  of  benefits  in  case  of  sick- 
ness, temporary  or  permanent  physical  disability,  either  as  the 
result  of  disease,  accident  or  old  age  -.  provided,  that  the  period  of 
life  at  which  payment  of  physical  disability  benefits  on  aecoiint  of 
old  age  commences,  shall  not  be  under  seventy  years,  subject  to 
their  compliance  with  its  constitution  and  by-laws.  The  fund  from 
which  the  payment  of  such  benefits  shall  be  paid,  which  shall  be 
58 


914  FRATERNAL    SOCIETY    LAW 

known  as  the  benefit  fund,  and  the  fund  from  which  tlie  expenses 
of  such  association  shall  be  defrayed,  which  shall  be  known  as  the 
general  fund,  shall  be  derived  from  assessments,  monthly  payments 
or  dues  collected  from  its  members.  Payment  of  death  benefits  shall 
be  to  the  families,  heirs,  blood  relatives,  affianced  husband  or  affi- 
anced wife,  or  to  persons  dependent  upon  the  member  at  the  time 
of  his  death,  and  should  there  be  no  one  of  the  classes  herein  men- 
tioned, capable  of  taking  the  benefit  at  the  death  of  the  member, 
then  the  same  shall  pass,  as  provided  by  the  laws  and  rules  of  the 
association.  Such  association  shall  be  governed  by  this  act,  and 
shall  be  exempt  from  the  provisions  of  the  insurance  laws  of  this 
State,  and  no  law  hereafter  passed  shall  apply  to  them  unless  they  be 
expressly  designated  therein. 

Note. — Associations  must  provide  for  substantial  death  benefit;  sick  and 
accident  must  be  incidental  and  not  of  the  essence  of  the  contract  (Attor- 
ney General's  Opinion,  September  11,  1900).  The  law  does  not  say  what 
proportion  shall  be  death  benefit  (Attorney  General's  Opinion,  November  5, 
1900).  Fraternal  beneficiary  associations  may  not  write  endowment  poli- 
cies  (Attorney  General's  Opinion,  August  18,  1901). 

All  Associations  Described  Herein,  Now  Doing  Business  in  Texas,  as 
Well  as  Those  Which  May  Hereafter  Come  Into  the  State,  Must 
Comply  With  the  Provisions  of  This  Act. 

Section  189.  All  such  associations  coming  within  the  description 
as  set  forth  in  Section  1  [Section  188]  of  this  act,  organized  under 
the  laws  of  this  or  any  other  State,  province  or  territory,  and  now 
doing  business  in  this  State,  may  continue  such  business,  and 
all  associations  of  a  fraternal  beneficiary  character  not  coming 
within  the  description,  as  set  forth  in  Section  1  of  this  act.  and  now 
doing  business  in  this  State,  may  continue  such  business;  provided, 
that  all  such  associations  of  eitlier  character  above  mentioned  shall 
hereafter  comply  with  the  provisions  of  this  act  regulating  annual 
reports  and  the  designation  of  the  Conimissioner  of  Insurance  as  the 
person  upon  whom  process  may  be  served,  as  hereinafter  provided, 
and  otherwise  complying  with  the  terms  of  this  act  hereinafter 
provided. 


THE    HTATE    OF    TEXAS  915 

Must  File  Copy  of  Charter,  Constitution  and  By-Laws — Must  Ap- 
point Commissioner  to  Accept  Service  of  Legal  Process — Commis- 
sioner May  Examine. 

Section  ino.     Any  snch  association  comin!";  within  the  description 
as  set  forth  in  Section  1  [Section  188]  of  this  act/organized  under  the 
laws  of  any  other  State,  province  or  territory,  and  not  now  doing 
business  in  this  State,  shall  be  admitted  to  do  business  within  this 
State  when  it  shall  have  filed  with  the  Commissioner  of  Insurance  a 
duly  certified  copy  of  its  charter  and  articles  of  association,  and  a  copy 
of  its  constitution  and  by-laws,  certified  to  by  its  secretary  or  cor- 
responding officer,  together  with  an  appointment  of  the  Commissioner 
of  Insurance  of  this  State  as  a  person  upon  whom  process  may  be 
served  in  any  suit  in  which  such  association  may  be  a  part.y ;  and 
provided,  that  such  association  shall  be  shown  to  be  authorized  to  do 
business  in  the  State,  province  or  territory  in  which  it  is  incorpor- 
ated or  organized,  in  case  the  laws  of  such  State,  province  or  terri- 
tory shall  provide  for  such  authorization,  and  in  case  the  laws  of 
such  State,  province  or  territory  do  not  provide  for  any  formal 
authorization  to  do  business  on  the  part  of  such  association,  then 
such  association  shall  be  shown  to  be  conducting  its  business  in  ac- 
cordance with   the  provisions  of  this   act,   for  which   purpose   the 
Commissioner  of  Insurance  of  this  State  may  personally,  or  by  some 
person  to  be  designated  by  him,  examine  into  the  condition,  affairs, 
character  and  business  methods,  accounts  and  books  of  such  asso- 
ciation at  its  home  office,  which  examination  shall  be  conducted  at 
the  expense  of  such  association,  such  expense  not  to  exceed  five 
dollars  per  day  and  actual  expenses  of  travel,  and  reasonable  hotel 
bills  of  the  person  making  such  examination;  jirovided,  the  cost  of 
such  examination  shall  never  exceed  the  total  sum  of  fifty  dollars; 
and  provided  further,   that  such  association  shall  be  required  to 
furnish  such  an'  annual  statement  on  entering  the  State  for  the 
preceding  year's  business,  snch  as  is  set  forth  in  the  requirements 
of  Section  5  [Section  192]  of  this  Act. 

Commissioner  Shall  Keep  a  Record  of  Process  Served  on  Him. 

Section  191.     When  legal  process  against  any  such  association  is 


916  FRATERNAL    SOCIETY    LAW 

served  upon  the  Commissioner  of  Insurance  of  this  State,  in  any  suit 
in  which  such  association  may  be  a  party,  he  shall  immediately  notify 
the  association  of  such  service  by  letter  prepaid  and  directed  to  its 
secretary  or  corresponding  officer,  and  shall  within  three  days  after 
such  service,  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him.  The  plaintiff  in  such  suit  shall,  at  the  time  such  pro- 
cess is  served,  pay  the  Commissioner  of  Insurance  a  fee  of  two 
dollars,  which  shall  be  recovered  by  him  as  part  of  the  cost  if  he 
prevails  in  the  suit.  The  Commissioner  of  Insurance  shall  keep  a 
record  of  all  the  process  served  on  him,  showing  the  day  and  hour  of 
such  service,  and  any  process  served  on  said  commissioner  as  herein 
provided  shall  be  valid  and  binding  on  such  association. 

Annual  Statement,  and  What  It  Must  Show. 

Section  192.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and 
file  with  the  Commissioner  of  Insurance  of  this  State  a  report  of  its 
affairs  and  operations  during  the  year  ending  on  the  thirty-first  day 
of  December  of  the  previous  year,  which  annual  report  shall  be  in 
lieu  of  all  other  reports  required  by  any  other  law.  Such  report 
shall  be  upon  blank  forms  to  be  provided  by  the  Commissioner  of 
Insurance,  and  shall  be  verified  under  oath  by  the  duly  authorized 
officer  of  such  association,  and  shall  be  published,  or  the  substance 
thereof,  in  the  annual  report  of  the  Commissioner  of  Insurance 
under  a  separate  part,  titled  "Fraternal  Beneficiary  Associations," 
and  shall  contain  answers  to  the  following  questions : 

(1)  Number  of  certificates  issued  during  the  year  or  members 
admitted. 

(2)  Amount  of  indemnity  affected  thereby. 

(3)  Number  of  losses  or  benefit  liabilities  incurred. 

(4)  Number  of  losses  or  benefit  lialiilities  paid. 

(5)  The  amount  received  from  each  assessment  for  the  year. 

(6)  Total  amount  paid  members,  beneficiaries  or  heirs. 

(7)  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

(8)  Number  and  kinds  of  claims  compromised  or  resisted,  and 
brief  statement  of  reasons. 


THE    STATE    OF    TEX  AH  917 

(9)  Does  association  eliarge  annua)  or  other  jicriddicjil  dues  or 
admission  fee? 

(10)  How  much  on  each  one  thousand  dollars,  nnnually  or  per 
capita,  as  the  case  may  be? 

(11)  Total  amount  received,  from  what  source,  and  distribution 
thereof. 

(12)  Total  amount  of  salaries  paid  to  officers. 

(13)  Does  association  guarantee  in  its  certificate  fixed  amounts 
to  be  paid,  regardless  of  amount  realized  from  assessments,  dues, 
admission  fees  and  donations? 

(14)  If  so,  state  what  amount  guaranteed  and  the  security  of 
such  guarantee. 

(15)  Has  the  association  a  reserve  or  emergency  fund? 

(16)  If  so,  how  is  it  created  and  for  whnt  purpose,  the  amount 
thereof,  and  how  invested? 

(17)  Has  the  association  more  than  one  class? 

(18)  If  so,  how  man.y,  and  the  amount  of  indemnity  in  each? 

(19)  Number  of  members  in  each  class. 

(20)  If  voluntary,  so  state  and  give  date  of  organization. 

(21)  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time,  giving  chapter  and  year  and  date  of  the  act. 

(22)  If  organized  under  the  laws  of  any  other  State,  under 
what  law  and  at  what  time,  giving  chapter  and  year  and  date  of 
the  act. 

(23)  Number  of  certificates  of  beneficiary  membership  lapsed 
during  the  year. 

(24)  Number  in  force  at  the  beginning  of  the  year,  and  end  of 
the  year ;  if  more  than  one  class,  number  in  each  class. 

(25)  Name  and  addresses  of  its  president,  secretary  and  treas- 
urer or  corresponding  officer. 

The  Commissioner  of  Insurance  is  authorized  and  empowered 
to  address  any  additional  inquiries  to  any  such  association  in  rela- 
tion to  the  matters  embraced  in  such  report,  and  such  officers  of 
such  association  as  the  Commissioner  of  Insurance  ma.v  require 
shall  promptly  reply  in  writing,  under  oath,  in  all  such  inquiries. 


918  FRATERNAL    SOCIETY    LAW 

Refusal  of  Association  to  Make  Report  Forfeits  Right  to  Do  Business. 

Section  193.  Any  such  association  refusing  or  necjlecting  to  make 
the  report  provided  for  in  this  act  (or  that  shall  fail  to  pay  any  valid 
final  judgment  rendered  against  it  in  any  of  the  courts  of  this  State 
vrithin  sixty  days  after  the  rendition  thereof),  shall  be  excluded 
from  doing  business  within  this  State.  Said  Commissioner  of  In- 
surance must  within  sixty  days  after  failure  to  make  such  report,  or 
in  case  any  such  association  shall  exceed  its  powers,  or  shall  con- 
duet  its  business  fraudulently,  or  shall  fail  for  a  period  of  sixty  days 
to  pay  off  any  valid  final  judgment  which  may  be  rendered  against 
it  in  any  of  the  courts  of  this  State,  or  shall  fail  to  comply  with  any 
of  the  provisions  of  this  act,  give  notice  in  writing  to  the  Attorney 
General,  who  shall  immediately  commence  an  action  against  any 
such  association  to  enjoin  the  same  from  carrying  on  any  business 
in  this  State;  and  no  injunction  against  any  such  association  shall 
be  granted  by  anj'  court  except  on  application  of  the  Attorney  Gen- 
eral, after  the  request  of  the  Commissioner  of  Insurance  wliether 
the  State  or  a  member  or  other  party  seeks  relief.  No  association  so 
enjoined  shall  continue  business  until  such  report  shall  be  made 
(nor  until  such  valid  final  judgment  shall  be  paid)  or  overt  act  or 
violation  complained  of  shall  have  been  corrected,  nor  until  the  costs 
of  such  action  be  paid  by  it :  provided,  the  courts  shall  find  that  such 
association  was  in  default  as  charged,  whereupon  the  Commissioner 
of  Insurance  shall  reinstate  such  association,  and  not  until  then 
shall  such  association  be  allowed  to  again  do  business  in  this  State. 

Pees. 

Section  194.  Every  such  association  coming  within  the  descrip- 
tion as  set  forth  in  Section  1  [Section  1881  of  this  act  shall  pay 
annually  to  the  Commissioner  of  Insurance  the  following  fees  in 
connection  with  its  entrance  into  the  State : 

Fee  for  filing  certified  copy  of  chai'ter $5  00 

Fee  for  certificate  of  authority  to  association 1  00 

Fee  for  filing  annual  statement 1  00 


THE    STATE    OF    TEXAS  <jl9 

Agent  or  Solicitor  Must  Hold  Certificate  From  Commissioner  of  In- 
surance— Penalty  for  Failure. 

Section  195.  Any  person  who  solicits  for  or  organizes  lodo:ps  of 
such  associations  as  are  described  in  the  first  section  of  this  act 
without  first  obtaining  from  the  Commissioner  of  Insurance  a  cer- 
tificate of  authority  showing  that  the  association  has  complied  with 
the  provisions  of  this  act,  and  is  entitled  to  do  business  in  this  State, 
shall  be  deemed  guilty  of  a  misdemeanor  and,  upon  conviction,  shall 
be  punished  by  a  fine  of  not  less  than  one  hundred  dollars  ($100.00) 
nor  more  than  two  hundred  and  fifty  dollars  (.$250.00),  or  by  im- 
prisonment in  the  county  jail  for  not  less  than  three  (3)  nor  more 
than  six  (6)  months,  or  by  both  such  fine  and  imprisonment;  pro- 
vided, the  provisions  of  this  section  shall  not  be  so  construed  as  to 
prohibit  any  member  or  members  of  a  local  or  subordinate  lodge 
from  soliciting  any  person  or  persons  to  become  a  member  of  any 
local  or  subordinate  lodge  already  in  existence ;  and  provided  fur- 
ther, the  provisions  of  this  section  shall  not  apply  to  any  member 
or  members  of  any  local  or  subordinate  lodge  who  participates  in, 
supervises,  directs  or  conducts  the  organization  or  establishment  of 
any  local  or  subordinate  lodge  within  tlie  limits  of  the  county  of 
his  or  their  residence  or  lodge  district. 

May  Collect  Excessive  Assessments  for  the  Purpose  of  Creating  a 
Reserve  Fund. 

Section  196.  Any  fraternal  beneficiary  association  organized  under 
the  laws  of  this  State,  or  any  other  State,  province  or  territory, 
doing  business  in  this  State  under  the  provisions  of  thii?  act,  which 
shall  provide  in  its  constitution  or  by-laws  for  the  collection  of 
assessments  from  its  members  at  a  rate  higher  than  may  be  neces- 
sary to  pay  ordinary  death  or  disability  claims  or  benefits,  for  the 
purpose  of  creating  a  reserve  fund  to  be  used  in  cases  of  emergency. 
or  for  the  purpose  of  maintaining  a  maximum  rate  of  assessment. 
shall  have  the  right  to  do  so,  and  such  reserve  fund  shall  constitute 
a  part  of  the  benefit  fund,  and  such  association  shall  not  be  per- 
mitted to  use  such  fund  for  any  pui'pose  except  the  payment  of 
death  or  disability  benefits,  and  such  reserve  funds  shall  be  invested 


920  FRATERNAL    SOCIETY    LAW 

ill  such  securities  and  iu  such  manner  as  may  be  directed  and  ap- 
proved by  the  board  of  trustees  of  such  association. 

Funds  Must  Be  Kept  Separate. 

Section  197.  The  benefit  fund  and  the  general  fund  of  any  fra- 
ternal beneficiary  association  doing  business  in  this  State  under  the 
provisions  of  this  act,  shall  each  be  kept  as  a  separate  fund,  and  it 
shall  be  unlawful  to  transfer  or  use  any  part  of  the  benefit  fund  for 
any  other  purpose  than  the  payment  of  benefits  or  expenses  incurred 
in  the  settlement  of  beneficiary  claims. 

Money  or  Other  Benefits  Not  Liable  for  the  Debts  of  the  Beneficiary. 

Section  198.  The  money  or  other  benefits,  charity,  relief  or  aid, 
to  be  paid,  provided  or  rendered  by  any  association  authorized  to 
do  business  under  the  provisions  of  this  act.  shall  not  be  liable  for 
the  debts  of  the  beneficiary  or  holder  of  any  certificate  and  shall  not 
'  be  subject  to  garnishment  or  other  process  at  the  suit  of  any  creditor, 
nor  shall  it  be  taken,  seized,  appropriated  or  applied  b.y  any  legal  or 
equitable  process  or  bj'  operation  of  law,  to  the  debts  of  the  certifi- 
cate holder  or  any  beneficiary  named  in  such  certificate  or  any  per- 
son who  may  have  an.y  rights  thereunder. 

May  Provide  for  the  Meeting  of  Its  Legislative  Body  in  Any  Other 
State  Where  it  Shall  Have  Subordinate  Bodies. 

Section  199.  Any  fraternal  beneficiary  association  organized  under 
the  laws  of  this  State,  or  doing  business  in  this  State,  may  pro- 
vide for  the  meetings  of  its  legislative  or  governing  body  in  any 
other  State,  province  or  territory  wherein  such  associations  shall 
have  subordinate  bodies,  and  all  business  transacted  at  such  meet- 
ings shall  be  valid  in  all  respects,  as  if  such  meetings  were  held  in 
this  State,  and  when  the  laws  of  such  association  provide  for  the 
election  of  its  officers  by  votes  to  be  cast  in  its  subordinate  bodies, 
the  votes  so  cast  in  such  bodies  in  another  State,  province  or  terri- 
tory shall  be  valid  as  if  cast  within  this  State. 


THE    STATE    OF    TEXAS  921 

Reciprocal  Relations — May  Assess,  Levy  and  Collect  From  Its  Mem- 
bers. 

Section  200.  Any  fraternal  beneficiary  association  doing  business 
in  this  State  when  by  its  laws,  rules  and  constitution,  has  and  main- 
tains reciprocal  relations  with  any  supreme  or  orand  ])ody  of  any 
other  corporation  or  association,  resident  of  another  jirovincc.  State 
or  territory,  shall  have  the  right  to  assess,  levy  and  collect  from  its 
members,  and  pay  the  same  over  to  such  supreme  or  grand  body,  as 
may  be  due  it  as  provided  by  the  laws  and  constitution  of  such 
local  association. 

Seven  or  More  Persons  Must  Petition  in  Writing  for  Articles  of 
Incorporation — General  Provisions. 

Section  201.  Seven  or  more  persons,  citizens  of  the  United  States, 
and  two  of  whom  must  be  citizens  of  this  State,  may  apply  for  and 
receive  articles  of  incorporation  for  the  organization  of  a  fraternal 
beneficiary  association.  Such  application  must  be  in  writing,  and 
signed  by  the  applicants,  and  must  be  acknowledged  before  some 
authorized  officer  to  take  acknowledgments  of  deeds,  and  same  shall 
set  forth  : 

(1)  The  names  and  places  of  residence  of  the  applicants. 

(2)  Proposed  corporate  name  of  the  association,  which  shall  not 
too  closely  resemble  the  name  of  any  other  similar  organization. 

(3)  The  object  and  purpose  for  which  the  association  is  formed, 
and  same  shall  not  include  more  liberal  powers  than  are  granted  by 
this  act. 

(4)  The  location  of  the  principal  office  of  the  corporation,  which 
may  be  in  any  State,  province  or  territory,  where  the  association  has 
subordinate  bodies. 

(5)  Number  of  trustees,  directors  or  similar  officers,  who  shall 
manage  the  business  of  the  corporation,  and  the  names  of  such 
directors  for  the  first  year,  or  until  the  governing  body  shall  meet. 

(6)  The  term  for  which  such  corporation  shall  exist  shall  not 
exceed  fifty  years.  Such  charter  shall  be  filed  with  the  Secretary  of 
State,  who  shall  record  the  same  at  length  in  a  book  kept  for  that 
purpose,  and  retain  the  original  on  file  in  his  office;  a  copy  of  the 


922  FRATERNAL    SOCIETY    LAW 

charter  or  of  the  record  thereof,  certified  under  the  great  seal  of  the 
State  of  Texas,  shall  be  evidence  of  the  creation  of  the  corporation. 
Such  charter  may  be  amended  at  any  time  by  filing  with  the  Secre- 
tary of  State  the  desired  amendments,  properly  acknowledged,  as 
required  in  obtaining  a  charter. 

Fee  for  Charter  Fifty  Dollars. 

Section  20l2.  The  fee  for  such  charter  shall  be  fifty  dollars,  and 
for  each  amendment  twenty -five  dollars,  which  shall  be  paid  to  the 
Secretary  of  State  at  the  date  of  the  filing  of  such  charter  and 
amendments. 

Certain  Railway  Orders  Exempt. 

Section  203.  The  provisions  of  this  act  shall  not  apply  to  nor 
include  the  Brotherhood  of  Locomotive  Firemen,  Brotherhood  of 
Locomotive  Engineers,  Brotherhood  of  Railroad  Trainmen,  Order  of 
Railway  Conductors.  Order  of  Railway  Telegraphers,  Switchmen's 
Union  of  North  America,  and  Railway  ]\Iail  Association.  Act  of 
May  4,  1899.  (Sec.  16,  Chap.  115,  General  Laws  26th  Leg.  as 
amended  by  Sec.  1,  Chap.  113,  General  Laws  28th  Leg.  as  amended 
by  Sec.  16.  of  Chap,  106,  General  Laws  29th  Leg.) 

Beneficiary,  Change  of. 

Where  the  constitution  of  a  society  provides  a  method  by  which 
change  of  beneficiary  may  be  effected,  the  method  provided  is  ex- 
clusive of  all  others  and  must  be  substantially  complied  with. 

Flowers  vs.  Sovereign  Camp,  Woodmen  of  the  World,  Court  of  Civ. 
App.  of  Texas,  November.  3905,  90  S.  W.  526. 

Fraternal  Societies  Exempt  from  General  Insurance  Laws. 

The  statutes  of  the  State  relating  to  insurance  and  providing 
penalties  for  failure  to  pay  insurance  contracts  within  the  time 
specified    therein,    is    held    not    to    appl.v    to    fraternal    beneficiary 

societies. 


THE    STATE    OF    TEXAS  923 

Sovereign  Camp,  Woodmen  of  llie  World  vs.  Carrington,  Texas  Ct. 
Civ.  App.,  Nov.,  1905,  90  S.  W.  921. 

Agency — Waiver  of  Laws  by  Local  Lodge  Officer. 

A  clerk  of  a  local  camp  to  whom  the  benefit  certificate  was  en- 
trusted for  delivery  and  who  had  discretion  to  withhold  il  during 
the  sickness  of  the  member,  but  who  delivered  it  to  the  mother  of 
the  member,  was  held  to  have  waived  a  provision  in  the  certificate 
and  in  the  constitution  of  the  society  to  the  effect  that  no  liability 
should  begin  on  any  certificate  until,  delivered  to  the  insured  in 
person  and  while  in  good  health. 

Sovereign  Camp,  Woodmen  of  tlie  World  vs.  Carrington,  Texas  Ct. 
Civ.  App.,  Nov.,  1905,  90  S.  W.  921. 

Beneficiary,  Death  of — Rights  of  Wife. 

A  member's  wife,  who  was  named  as  his  beneficiary,  having  died 
before  the  certificate  became  payable,  ;ind  tlie  member  having  re- 
married and  never  changed  his  beneficiary,  it  was  held  that  the 
certificate  was  payable  to  the  surviving  wife  under  a  provision  in 
the  laws  of  the  society  requiring  payments  to  be  made  in  such 
cases  to  the  next  living  relation,  and  further  providing  that  in  de- 
termining who  is  such  next  living  relation  the  order  shall  be  the 
member's  wife,  children,  adopted  children,  parents,  bi'others,  sisters, 
or  other  blood  relatives,  or  persons  dependent  upon  the  member. 

Harris  vs.  Harris,  Tex.  Ct.  Civ.  App.,  Nov.,  1906,  97  S.  W.  504. 

Suicide — Rule  as  to  Burden  of  Proof. 

Where  a  certificate  exempted  a  society  from  liability  for  death 
by  suicide,  and  in  an  action  on  the  certificate  it  apjieared  that  the 
member  came  to  his  death  by  a  gunshot  while  alone  in  his  room, 
the  burden  was  upon  the  society  to  show  suicide. 

Sovereign  Camp,  Woodmen  of  the  World  vs.  Boelime.  Tex.  Ct.  Civ. 
App.,  Nov.  1906,  97  S.  W.  847. 


924  FRATERNAL    SOCIETY    LAW 

Warranty,  Definition  of. 

A  warranty  in  an  insurance  contract  is  a  statement  made  therein 
by  the  insured  which  is  susceptible  of  no  construction  other  than 
that  the  parties  mutually  intended  that  the  contract  should  not  be 
binding  unless  siich  statement  be  literally  true. 

Phoenix  Assurance  Co.  vs.  Munger  Improved  Co.,  Nov.,  1898,  92  Texas 
297. 

Contract,  Situs  of.  What  Laws  Govern. 

A  contract  of  insurance  which  promised  payment  on  fulfillment 
of  its  conditions,  at  the  home  office  of  the  company  in  Missouri,  was 
governed  as  to  the  effect  of  its  conditions  as  to  misrepresentations  in 
the  application  by  the  statutes  in  that  State. 

Seiders  vs.  Merchants  Life  Assn.,  Jan.,  1900,  93  Texas  194. 

Proofs  of  Loss,  False  Statements  in. 

While  liability  on  an  insurance  contract  may  be  contested  on  the 
ground  of  a  false  statement  in  the  proofs  of  loss,  the  claimant  may 
show  ia  avoidance  that  the  statement  was  not  wilfully  false. 

Insurance  Co.  vs.  Wicker,  March,  1900,  93  Texas  390. 

Warranty,  Oral  Statements  Do  Not  Change  Written. 

The  validity  of  an  insurance  contract  issued  on  a  written  appli- 
cation and  making  the  statements  therein  warranties,  must  depend 
on  the  truth  of  such  written  statements  regardless  of  any  oral  com- 
munications made  by  the  insured. 

Fidelity  Mut.  Life  Assn.  vs.  Harris,  June,  1900,  94  Texas  26. 

Contracts,  Situs  of.  Where  Made. 

Contracts  of  insurance  on  applications  made  in  one  State  and 
forwarded  for  acceptance  to  the  domicile  of  the  society  in  another. 


THE    STATE    OF    TEXAS  925 

are  ordinarily  treated  as  made  at  such  domicile,  because  the  act  of 
the  insurer  in  signifying  its  acceptance  there  completes  the  contract. 

Fidelity  Mut.  Life  Assn.  vs.  Harris,  June.  1900,  94  Texas  25. 

Fraternal  Societies  May  Hold  Corporate  Meetings  Outside  State  of 
Charter. 

An  incorporated  society  liaving  no  stoekhoUlers  hut  eomitosed 
of  members  living  in  various  States,  in  which  it  was  authorized  to 
organize  subordinate  lodges,  is  not  subject  to  the  limitations  im- 
posed on  ordinary  corporations  that  corporate  acts  must  be  per- 
formed only  in  the  State  where  it  was  created.  Its  authorized  legis- 
lative body  can  exercise  the  power  given  it  to  change  the  constitu- 
tion and  laws  of  the  society  at  a  meeting  regularly  called  but  sitting 
in  a  State  other  than  that  in  which  it  was  created. 

Sovereign  Camp,  Woodmen  of  the  World  vs.  Fraley,  Dec,  1900,  94 
Texas  200. 

After-enacted  Laws  Strictly  Construed. 

An  amended  constitution  providing  that  a  clause  of  avoidance 
in  case  the  member  should  die  by  his  own  hand  or  act,  sane  or  in- 
sane, shall  be  made  a  part  of  every  beneficiary  certificate,  and  shall 
be  binding  on  both  member  and  order,  was  a  command  to  its  officers 
to  embody  such  condition  in  the  certificates ;  it  was  not  a  general 
provision  declaring  all  certificates  avoided  in  case  of  suicide. 

Sovereign  Camp,  Woodmen  of  the  World  vs.  Fraley,  Dec,  1900,  94 
Texas  200. 

Fund  Exempt  From  Seizure  for  Debts. 

The  amount  due  under  a  fraternal  society  certificate  to  the  bene- 
ficiary of  the  member  is  exempt  from  garnishment  for  the  debt  of 
such  beneficiary,  under  the  act  of  May  12,  1899,  regulating  fraternal 
societies. 

Supreme  Lodge,  United  Benev.  Assn.  vs.  Johnson,  May,  1904.  98  Texas 
1. 


926  FRATERNAL    SOCIETY    LAW 

Fraternal  Exemption  Statutes  Constitutional. 

The  law  regulating  fraternal  societies  passed  by  the  legislature 
in  1899,  is  not  unconstitutional  as  denying  the  equal  i)rotection  of 
the  law  by  reason  of  the  exemjition  in  favor  of  certain  organiza- 
tions named  therein  from  the  operation  of  said  section. 

Supreme  Lodge,  United  Benev.  Assn.  vs.  Johnson,  May,  1904,  98  Texas 
1. 

Contracts,  What  State  Laws  Imported  Into. 

The  rule  that  a  contract  of  insurance  should  be  regarded  as  madj 
in  the  State  where  it  is  executed  and  made  for  delivery  to  the  mem- 
ber in  another  State,  and  should  be  governed  by  the  law  in  the  State 
of  its  execution,  does  not  import  into  the  contract  the  laws  of  sucli 
State  which  by  their  terms  apply  only  to  contracts  to  be  performed 
in  that  State.  ■ 

Met.  Life  Ins.  Co.  vs.  Bradley,  Nov.,  1904,  98  Tex.  230. 

Evidence — Coroner's  Verdict  Not  Admissible. 

In  an  action  on  a  benefit  certificate  upon  the  issue  whether  the 
member  died  by  suicide — an  excepted  risk — or  by  accident,  the  ver- 
dict of  the  coroner's  jury  finding  that  death  was  from  suicide  was 
not  admissible  in  evidence. 

Boehme  vs.  Sovereign  Camp,  Woodmen  of  the  World,  Jan.,  1905,  98 
Texas  376. 

Assignment  of  Certificate  Valid  as  Between  Assignor  and  Assignee. 

Where  the  beneficiary  witli  the  consent  of  the  member  pledged  the 
benefit  certificate  to  a  third  party  to  secure  assessments  thereon  ad- 
vanced by  said  pledgee,  neither  the  member  nor  the  beneficiary 
could  recover  the  certificate  from  such  pledgee,  or  from  an  assignee 
of  his  rights,  without  repayment  of  the  assessments  advanced  by 
them  on  the  faith  of  such  pledge,  though  it  was  forbidden  by  the 
laws  of  the  society  issuing  the  certificate. 

Coleman  vs.  Anderson,  April,  1905,  98  Texas  570. 


THE    STATE    OF    TEXAS  927 

Certificate — Assignment  of  Valid. 

The  member  with  the  conseut  of  his  IxMieficiary  may  assign  a 
benefit  certificate  to  a  third  person,  notwitlistanding  that  siicli  as- 
signment is  forbidden  by  the  laws  of  the  society. 

Coleman  vs.  Anderson,  April.  1905,  98  Texas  .570. 

Beneficiary,  When  Heir  Takes  Benefit. 

A  benefit  payable  on  the  death  of  the  member  to  a  named  bene- 
ficiary, and  providing  that  any  change  of  beneficiary  should  be  made 
by  surrender  and  cancellation  of  the  certificate  and  the  issuance  of 
a  new  one,  did  not  become  payable  to  the  heir  of  the  beneficiary  on 
the  death  of  both  insured  and  beneficiary,  unless  the  latter  survived 
the  former. 

Screwmen's  Benev.  Assn.  vs.  Whitridge,  May,  1902,  95  Texas  539. 

Death  in  Common  Disaster. 

In  order  that  the  heir  of  the  beneficiary  might  recover  where  both 
member  and  beneficiary,  husband  and  wife,  perished  in  the  Gal- 
veston Hood,  it  was  necessary  to  shoAv  that  the  former  died  first. 

Screwmen's  Benev.  Assn.  vs.  Whitridge,  May,  1902,  95  Texas  539. 

Fraternal  Society,  What  is? 

For  the  facts  which  are  held  sufficient  to  constitute  a  fraternal 
beneficiary  society,  see 

Supreme   Council,   Am.   Legion   ot   Honor   vs.    Story,   Jan.,   1904,   97 
Texas  264. 

Suspended  Lodges,  Members  of  Not  Entitled  to  Benefits. 

Members  of  a  subordinate  lodge,  which  has  been  suspended  for 
failure  to  pay  an  as.sessment  in  accordance  with  the  by-laws,  are 
not  entitled  to  participate  in  death  benefits  during  such  suspension. 


928  FRATERNAL    SOCIETY    LAW 

where  the  law  visits  such  penalty  upon  the  members  of  lodges  in 
default. 

Supreme  Lodge.  National  Reserve  Assn.  vs.  Turner,  June,  1898,  19 
Tex.  Civ.  App.  346. 

Reinstatement,  a  Contract  Right. 

A  member  of  a  society  under  whose  laws  suspended  members  are 
entitled  to  reinstatement  if  living  and  iu  good  health,  is,  as  a  matter 
of  contract,  entitled  to  such  reinstatement  if  living  and  in  good 
health  when  the  application  is  made. 

Supreme  Lodge,  National  Reserve  Assn.  vs.  Turner,  June,  1898,  19 
Tex.  Civ.  App.  346. 

Foreign  Society,  Suit  Against  and  Venue  of. 

A  foreign  society  doing  business  in  this  State  may  be  sued  in  its 
courts,  though  no  permit  to  do  business  has  been  obtained,  and  the 
venue  is  properly  laid  iu  any  count}'  iu  which  it  does  business. 

Home  Forum  vs.  Jones,  Dec,  1S9S,  20  Tex.  Civ.  App.  68. 

Conflicting  Laws,  How  Construed. 

Where  two  sections  of  the  law  of  a  society  are  in  conflict,  the  one 
most  favorable  to  the  member  and  his  beneficiary  will  be  accepted 
and  the  other  disregarded. 

Supreme  Lodge,  National  Reserve  Assn.  vs.  Mondrowskl,  Jan.,  1899, 
20  Tex.  Civ.  App.  322. 

Warranty  in  Application,  Waivers  of. 

False  answers  in  respects  to  habits  made  in  an  application  for 
membership  are  not  waived  because  the  officers  of  the  local  camp 
which  admitted  the  applicant  knew  the  truth  with  reference  to 
such  habits,  and  that  the  applicant  had  taken  the  liquor  cure,  but 


THE    STATE    OF    TEXAS  929 

did  not  know  the  contents  of  liis  application  wherein  he  denied  such 
habits  and  the  fact  of  his  having  taken  the  cure. 

Brown  vs.  Sovereign   Camp.  Woodmen  of  the  World,  Jan.,  1899,  20 
Tex.  Civ.  App.  373. 

After-enacted  Laws  Valid. 

In  his  application  for  membership  the  applicant  agreed  to  conform 
to  the  society's  existing  laws,  rules  and  usages,  and  to  such  as 
might  thereafter  be  adopted.  The  laws  were  thereafter  amended 
so  as  to  decrease  the  amount  of  the  certificate  and  also  of  the  dues, 
with  the  proviso  that  members  admitted  prior  to  a  certain  date,  to 
which  class  the  insured  belonged,  might  by  a  written  declaration  of 
such  allegation  remain  under  the  old  plan.  The  insured  failed  to 
make  such  declaration.  Held,  That  he  was  bound  by  the  change  and 
that  his  beneficiary  had  no  vested  right  in  the  certificate  that  could 
not  be  affected  by  such  change  in  the  laws. 

Duer  vs.  Supreme  Council,  Order  of  Chosen  Friends,  June,  1899,  21 
Tex.  Civ.  App.  493. 

Beneficiaries,  Relatives,  Who  Are. 

Where  the  laws  of  the  society  permitted  insurance  only  in  favor 
of  relatives  or  persons  dependent  on  the  member,  such  benefit  could 
be  extended  to  the  members  of  a  family  in  no  way  related  to  the 
member,  but  with  whom  he  had  lived  on  terms  of  intimacy  and 
affection,  receiving  from  them  board  and  attention  in  sickness,  and 
contributing  money,  supplies  and  gifts  to  them,  though  before  his 
death  he  had  removed  to  a  distant  State  from  which  he  occasionally 
sent  them  assistance  in  money. 

Grand  Lodge,  A.  O.  U.  W.  vs.  Bollman,  Nov.,  1899,  22  Tex.  Civ.  App. 
106. 

Beneficiaries  May  be  Named  by  Will. 

A  will  disposing  of  a  benefit  certificate  which  formed  no  part  of 
its  holder's  estate  and  was  not  the  subject  of  a  bequest,  may  eon- 
59 


I 


930  FRATERNAL    SOCIETY    LAW 

stitute  a  valid  written  designation  of  the  beneficiaries  in  compliance 
with  the  requirements  of  the  society. 

Grand  Lodge,  A.  O.  U.  W.  vs.  Bollman,  Nov.,  1899,  22  Tex.  Civ.  App. 
106. 

Proofs  of  Death,  When  Not  Required  From  Beneficiary. 

The  beneficiary  in  a  certificate  is  relieved  of  making  proof  of 
death  where  the  by-laws  of  the  society  require  the  subordinate  lodge 
to  ascertain  the  cause  and  circumstances  of  the  death  and  report 
them  to  the  Supreme  Secretary. 

Supreme  Council,  American  Legion  of  Honor  vs.  Landers,  May,  1900, 
23  Tex.  Civ.  App.  625. 

Beneficiaries  Lawfully  Named  Not  Ousted  by  After-enacted  Laws. 

A  member  of  a  society  had  named  his  creditor  as  beneficiary  of 
his  life  insurance,  agreeing  to  comply  with  all  the  laws  then  in  force 
or  thereafter  to  be  enacted.  A  subsequent  amendment  of  the  con- 
stitution of  the  society  provided  that  the  beneficiary  named  in  a 
certificate  shall  be  confined  to  one  or  more  of  the  family  of  the 
member,  or  some  person  related  to  him  by  blood,  or  who  should  be 
dependent  upon  him.  Held,  That  such  an  amendment  Avas  not  by 
its  terms  retroactive  in  effect  and  did  not  prevent  recovery  by  the 
creditor  as  beneficiary  on  the  death  of  the  member. 

Grand  Lodge,  A.  O.  U.  "W.  vs.  Stumpf,  Oct.,  1900,  24  Tex.  Civ.  App. 
309. 

Application,  Statements  in.  Respecting  Habits. 

The  .statement  by  the  applicant  in  his  medical  examination  that  he 
did  not  use  and  had  never  used  opium  or  other  narcotics,  is  to  be 
construed  as  having  reference  to  a  use  that  amounted  to  a  habit  or 
custom. 

National  Fraternity  vs.  Karnes,  Jan.,  1901,  24  Tex.  Civ.  App.  607. 


THE    STATE    OF    TEXAS  931 

Agency  of  Organizer,  to  What  Extent. 

"Where  a  lodge  is  organized  by  one  claiming  to  be  an  agent  of  the 
society,  who  is  equipped  with  its  blanks  and  literature,  and  the 
society  adopts  the  work  of  such  organizer,  it  will  be  estopped 
througli  information  which  the  organizer  at  the  time  possessed  as  to 
the  7)hysical  condition  and  habits  of  those  whom  he  has  received  for 
membership  in  the  lodge. 

National  Fraternity  vs.  Karnes,  Jan.,  1901,  24  Tex.  Civ.  App.  607. 

Medical  Examiner's  Knowledge  Imputed  to  Society. 

The  medical  examiner  of  a  society  who  has  knowledge  at  the  time 
of  making  an  examination  of  certain  facts  with  respect  to  the  con- 
dition of  health  of  the  applicant,  or  of  information  falsely  stated  by 
the  applicant,  is  regarded  as  the  agent  of  the  society,  and  his  knowl- 
edge is  to  be  imputed  to  the  society  unless  such  examiner  colluded 
with  th'e  applicant  to  defraud  the  society. 

National  Fraternity  vs.  Karnes,  Jan.,  1901,  24  Tex.  Civ.  App.  607. 

Beneficiary,  Death  Before  Member. 

A  certificate  was  issued  to  a  member  payable  at  his  death  to  his 
mother.  The  member  afterwards  married  and  died  after  the  death 
of  his  mother  without  having  designated  any  other  beneficiary.  The 
constitution  provided  that  at  the  death  of  a  beneficiary  member,  the 
sum  specified  in  the  certificate  should  be  paid  to  the  person  named 
therein  who  should  lie  his  wife,  children,  adopted  children,  parents, 
brothers,  sisters,  or  other  relatives;  and  in  case  the  certificate  was 
payable  to  one  of  such  relatives  who  should  at  the  time  of  the  death 
of  the  member  also  be  deceased,  and  no  designation  of  change  had 
been  made  by  the  member  in  writing  upon  his  certificate  during 
life,  it  should  be  paid  to  the  next  living  relative  in  the  order  named 
in  the  constitution.  Held,  That  the  certificate  was  payable  to  the 
member's  wife  to  the  exclusion  of  his  brothers. 

Mattison  vs.  Sovereign  Camp,  Woodmen  of  the  World,  January,  1901, 
25  Tex.  Civ.  App.  214. 


932  FRATERNAL    SOCIETY    LAW 

Forfeiture — Right  of  Must  be  Exercised  Strictly. 

The  entry  of  a  fine  against  a  member  by  the  secretary  of  a  society 
without  notice  will  not  affect  the  member's  financial  standing  so 
as  to  work  a  forfeiture  of  his  benefit  certificate  by  placing  him 
in  arrears,  where  neither  the  constitution  nor  the  by-laws  clothed 
the  officer  with  such  power. 

Screwmen's  Benev.  Assn.  vs.  O'Donahoe,  Feb.  1901,  25  Tex.  Civ.  App. 
254. 

Disability  Benefits,  Right  to. 

For  the  facts  in  a  case  brought  to  recover  disability  benefits,  see 

Supreme  Tent,  Knights  of  the  Maccabees  vs.  Cox,  Feb.,  1901,  25  Tex. 
Civ.  App.  366. 

Installment  Certificate,  Action  Lies  Only  on  Default  of  Payment  of 
Each  Installment. 

Where  under  a  benefit  certificate  sued  on,  plaintiff  was  entitled  to 
receive  annually  one-tenth  of  the  amount  of  the  certificate,  he  could 
recover  only  the  amount  of  the  installment  due  at  the  time  of  the 
trial,  and  a  judgment  for  the  entire  amount  and  providing  that 
execution  might  issue  annually  thereafter  for  the  remaining  iu.stall- 
ments,  was  error. 

Supreme  Tent,  Knights  of  the  Maccabees  vs.  Cox,  Feb.,  1901,  25  Tex. 
Civ.  App.  366. 

Beneficiary,  Who  May  Be. 

The  constitution  of  the  society  provided  for  the  payment  of  a 
death  benefit  fund  to  the  families,  heirs,  widows,  orphans  and  de- 
pendents of  its  deceased  members,  and  F.  who  was  a  member  and  a 
bachelor,  designated  his  brother  as  the  beneficiary  in  the  certificate 
issued  to  himself.  Afterwards  he  assigned  the  certificate  to  W,  wlm 
was  not  related  to  him  nor  dependent  upon  him,  no  consideration 
being  received  for  such  transfer.    F  continued  to  pay  the  member- 


THE    STATE    OE    TEXAS  933 

sliip  (lues  up  to  the  time  of  his  deatli.  TTcld,  that  the  assignment 
was  void,  as  W  could  not  be  a  iKMicficiary,  and  tliat  the  brother 
named  in  the  certificate  was  entitled  to  the  fund  as  against  other 
brothers  who  were  with  him  Ihc  only  heirs  of  the  deceased. 

Williams  and  Gates  vs.  Fletcher,  April,  1901,  26  Tex.  Civ.  App.  85. 

Warranty  and  Misstatements. 

In  an  application  for  a  certificate  the  applicant  was  asked  whether 
he  had  ever  been  successfully  vaccinated,  and  he  answered  no.  He 
was  also  asked  to  state  whether,  if  he  had  not  been  vaccinated 
and  his  death  should  result  from  smallpox,  he  would  waive  all  claims 
under  the  certificate,  and  he  answered  yes.  The  application  also 
stated  that  "for  the  purposes  of  this  application  I  declare  and  war- 
rant the  foregoing  answers  and  statements  to  be  correct."  The 
certificate  provided  that  it  should  be  null  and  void  and  of  no  effect 
if  any  of  the  statements  or  declarations  in  the  application  should 
be  found  in  any  respect  untrue.  The  applicant  had  in  fact  been 
successfully  vaccinated,  and  he  died  of  smallpox  after  the  issuance 
of  the  certificate.  Held,  that  the  statement  was  not  a  warranty,  and 
not  being  material  to  the  risk  did  not  avoid  the  contract. 

Sovereign  Camp,  "Woodmen   of  the  World  vs.   Gray,   June,   1901,   26 
Tex.  Civ.  App.  457. 

Reinstatement,  Representations  in  Application  for. 

Declarations  in  the  renewal  contract  that  the  insured  had  not  any 
injury,  sickness  or  ailment  of  any  kind,  and  that  he  had  not  con- 
sulted with  or  been  prescribed  for  by  any  physician,  or  received  any 
medical  treatment  since  the  date  of  the  original  application,  even 
if  they  were  mere  representations  were  material,  and  their  falsity 
vitiated  the  renewal  contract. 

Ash  vs.  Fidelity  Mut.  Life  Assn.,  June,  1901,  26  Tex.  Civ.  App.  501. 

Warranties  Must  be  Literally  Kept. 

"Where  it  clearly  appears  from  the  terms  of  the  contract  that  the 


934  FRATERNAL    SOCIETY    LAW 

statements  of  tlie  insured  are  to  be  treated  as  warranties,  then,  if 
false,  the  contract  becomes  non-enforcible;  and  whether  such  state- 
ments were  made  in  good  faith  or  are  material  to  the  risk  is  of  no 
consequence;  but  where  there  is  language  in  the  contract  which 
will  warrant  the  inference  that  a  forfeiture  will  not  be  insisted 
on  where  the  statement  though  false  is  not  material  to  the  risk, 
such  statement  will  be  construed  as  representations  and  will  not 
forfeit  the  contract  unless  material  to  the  risk. 

Delaware  Ins.  Co.  vs.  Harris,  June,  1901,  26  Tex.  Civ.  App.  537. 

Death  in  Common  Disaster,  Rule  as  to  Survivorship. 

Under  the  rules  of  the  common  law,  which  obtain  in  Texas  there 
is  no  presumption  of  survivorship  or  of  simultaneous  death  in  the 
case  of  persons  who  perish  in  a  common  disaster.  The  burden  of 
proof  in  an  action  for  the  proceeds  of  a  contract  was  held  to  be  on 
the  legal  representatives  of  the  beneficiary  to  show  that  the  bene- 
ficiary survived  the  insured,  in  a  contest  between  the  representatives 
of  the  beneficiary  and  the  representatives  of  the  member. 

Hildenbrandt  vs.  Ames,  Dec,  1901,  27  Tex.  Civ.  App.  377. 

Conditions  Precedent  to  Liability, 

A  condition  in  a  contract  avoiding  it  if  the  insured  was  not  in 
good  health  when  it  was  delivered,  did  not  make  the  contract  void 
for  a  trivial  illness  not  affecting  the  risk,  though  it  shortlj'  developed 
into  a  disease  causing  death. 

Woodmen  of  the  World  vs.  Locklin,  March,  1902,  28  Tex.  Civ.  App. 
486. 

Statute  of  Limitations,  When  Begin  to  Run, 

Where  a  member  was  wrongfully  expelled,  limitations  began  to 
run  from  the  day  of  expulsion  against  his  action  to  recover  assess- 
ments paid  by  him. 

Supreme  Council,  Cath.  Knights  of  America  vs.  Gambati,  May,  1902, 
29  Tex.  Civ.  App.  80. 


i 


THE    STATE    OF    TEXAS  935 

Expulsion — Member  May  Lose  Rights  Though  Same  Illegal. 

Where  the  society  is  composed  of  a  supreme  council  and  local 
lodges,  and  the  plaintiff  was  expelled  by  a  local  lodge  without  trial 
or  notice  as  required  by  the  laws  of  the  society,  and  although  he 
was  advised  of  the  illegality  of  the  action  and  his  right  of  appeal, 
he  made  no  appeal  to  the  Supreme  Council,  he  was  not  entitled  to 
maintain  an  action  to  recover  the  j)remiums  that  he  had  paid. 

Supreme  Council,  Cath.  Knights  of  America  vs.  Gambati,  May,  1902, 
29  Tex.  Civ.  App.  SO. 

Death  in  Common  Disaster. 

In  a  case  of  parties  perishing  together  in  a  common  disaster,  to 
the  particulars  of  which  there  is  no  evidence,  there  is  not  at  common 
law,  which  obtains  here,  as  there  is  in  the  civil  law,  any  presump- 
tion of  survivorship  based  upon  the  circumstances  of  age  and  sex. 

Males  vs.   Sovereign  Camp,  'Woodmen   of   the  World,  Oct.,   1902,   30 
Tex.  Civ.  App.  184. 

Beneficiary — Has  No  Vested  Interests. 

Where  a  fraternal  society  reserves  the  right  to  amend  its  laws, 
and  the  beneficiary  named  in  a  certificate  may  be  changed  at  the 
will  of  the  member,  the  beneficiary  has  no  vested  interest  in  the 
certificate  as  in  the  case  of  an  ordinary  life  insurance  policy. 

Males   vs.   Sovereign   Camp,   Woodmen   of   the  World,  Oct.,   1902,   30 
Tex.  Civ.  App.  184. 

Beneficiaries,  Who  May  Be — Death  in  Common  Disaster — Rule  of 
Survivorship. 

Where  a  benefit  certificate  is  issued  by  a  society  whose  object 
was  to  provide  a  fund  for  the  benefit  of  a  particular  class  of  persons, 
namely,  the  wife,  children,  parents,  or  other  blood  relatives,  and 
made  payable  to  the  wife  of  the  member,  a  certificate  issued  him 
which  provided  that  in  case  of  the  death  of  the  beneficiary  before 


i; 


93(J  FRATERNAL    SOCIETY    LAW 

that  of  the  member,  the  fund  should,  in  the  absence  of  a  new  desig- 
nation, be  paid  to  his  relatives  in  the  order  just  stated,  the  parents 
are  entitled  to  the  fund  as  against  the  legal  representatives  of  the 
wife,  where  the  member,  his  wife  and  their  children  all  perished  to- 
gether in  the  Galveston  flood,  there  being  no  evidence  as  to  any 
one  of  them  surviving  the  others;  the  burden  of  proof  being  on  the 
representatives  of  the  wife  to  show  that  she  survived  the  husband. 

Males   vs.   Sovereign   Camp,  Woodmen   of   the  World,   Oct.,   1902,   30 
Tex.  Civ.  App.  184. 

Interpleader — Attorney's  Fees  Not  Allowable  Out  of  Fund. 

Where  the  suit  was  on  a  benefit  certificate  by  parties  claiming  as 
beneficiaries,  and  the  insurer  impleaded  other  parties  asserting  a 
claim,  there  is  no  authority  for  the  court  to  allow  attorney's  fees  to 
the  impleading  party. 

Males  vs.   Sovereign   Camp,   Woodmen   of   the  World,   Oct.,  1902,   30 
Tex.  Civ.  App.  184. 

Warranties — Immaterial  Answers  No  Defense  Under. 

Where  a  contract  made  the  application  a  part  thereof,  and  made 
the  answers  therein  warranties,  false  statements  in  the  answers  to 
the  effect  that  the  applicant  had  not  consulted  a  physician  in  ten 
years,  and  that  she  had  never  had  a  doctor  except  in  childbirth,  were 
warranties,  and  whether  material  or  not  their  falsity  forfeited  the 
contract. 

Flippen  vs.  State  Life  Ins.  Co.,  November,  1902,  30  Tex.  Civ.  App.  362. 

Forfeiture  for  Failure  to  Make  Payments. 

A  certificate  conditioned  that  the  member  should  have  paid  all 
the  assessments  called  to  the  benefit  fund,  and  complied  with  the 
requirements  of  the  by-laws,  which  laws  authorized  his  suspension 
for  failure  to  pay  all  assessments,  was  held  to  be  voided  by  his 
failure  to  pay  an  assessment  duly  levied  for  other  purposes  than 
the  benefit  fund.    Both  the  conditions  prescribed  by  the  certificate 


ii 


THE    STATE    OF    TEXAS  937 

and  those  provided  by  the  by-laws  were  binding,  and  the  failure 
to  comply  with  the  latter  authorized  the  member's  suspension. 

Supreme  Council,  Am.  Legion  of  Honor  vs.  Landers,  January,  1903, 

31  Tex.  Civ.  App.  338. 

Beneficiary — Right  to  Change  Complete. 

An  unincorporated  society  had  no  provision  in  its  laws  for  mak- 
ing a  change  in  the  beneficiary,  but  it  had  been  the  custom  since  its 
organization  to  permit  a  member  to  make  change  by  endorsement 
on  the  certificate.  A  wife  taking  insurance  for  the  benefit  of  her 
husband,  after  divorce  changed  the  benefit  to  her  brothers  and  sis- 
ters without  the  consent  of  the  original  beneficiary.  Held,  That 
such  change  was  valid  and  that  the  divorced  husband  could  not 
recover  the  benefit  on  the  member's  death. 

Schmitt  vs.   New   Braunsfelser  Verein,   March,   1903,   32   Texas   Civ. 
App.  11. 

Initiation  May  be  Waived  by  Society. 

Where  the  deceased  never  appeared  before  the  local  lodge  for 
initiation,  and  was  never  initiated  into  the  society,  but  the  society, 
with  full  knowledge  of  this  fact,  received  his  assessments  and  dues 
and  delivered  to  him  the  benefit  certificate,  it  could  not  question  his 
membership  on  that  ground,  as  the  initiation  had  been  waived. 

Supreme  Ruling,  Fraternal  Mystic  Circle  vs.  Crawford,  June,  1903, 

32  Tex,  Civ.  App.  603. 

Warranty  of  Answers  Liberally  Construed. 

The  answer  of  an  applicant  that  he  had  never  had  any  serious 
illness  should  be  considered  as  a  mere  expression  of  opinion  as  to 
the  character  of  the  sickness,  and  should  not  avoid  the  policy  even 
though  untrue  and  made  a  warranty,  if  the  applicant  did  not  know 
its  falsity. 

Supreme  Ruling,  Fraternal  Mystic  Circle  vs.  Crawford.  June,  1903, 
32  Tex.  Civ.  App.  603. 


938  FRATERNAL    SOCIETY    LAW 

Amended  Laws  Required  to  be  Published. 

The  by-laws  of  a  society  provided  that  the  printing  in  the  official 
organ  of  any  notices  required  to  be  given  the  members,  when  such 
notices  are  signed  and  attested  by  the  proper  officers,  should  be 
deemed  legal  and  sufficient  service  of  such  notices,  and  then  further 
required  the  Supreme  Record  Keeper  to  compile  and  arrange  for 
publication,  subject  to  the  approval  of  the  Board  of  Trustees,  all 
amendments  to  the  laws  adopted  by  the  supreme  legislative  body. 
Held,  'That  such  provisions  of  the  by-laws  were  required  after  adop- 
tion to  be  published  in  the  official  organ,  and  until  so  published  were 
of  no  force  or  effect. 

Eversberg  vs.   Supreme  Tent,  Knights  of  the  Maccabees,  November, 
1903,  33  Tex.  Civ.  App.  549. 

After-enacted  By-laws  Valid — Effect  of  Agreement  to  be  Bound  by 
Such  Laws. 

Recitals  in  an  application  whereby  the  applicant  is  to  be  bound 
by  the  laws  of  the  order  in  force  at  the  time  or  that  may  thereafter 
be  adopted,  is  a  recognition  of  the  right  of  the  society  to  change 
its  by-laws,  and  the  consent  in  advance  by  the  applicant  to  be 
bound  b.v  any  changes  to  be  made,  and  such  an  agreement  is  valid 
and  binding  upon  the  applicant  so  admitted  to  membership  and 
upon  the  beneficiaries  i;nder  his  certificate. 

Eversberg  vs.   Supreme  Tent,  Knights  of  the  Maccabees,  November, 
1903,  33  Tex.  Civ.  App.  549. 

Suicide  Law  Valid. 

One  of  the  by-laws  of  a  society  provided  that  if  a  member  died 
by  self-destruction,  whether  sane  or  insane,  the  certificate  entitling 
him  to  participate  in  the  insurance  fund,  together  with  all  claims 
by  reason  of  membership,  should  be  ni;ll  and  void.  Held,  Tluit  a 
member  who  committed  suicide  thereby  forfeited  his  claim  against 
the  insurance  fund. 

United  Moderns  vs.  Colligan,  .Jan.,  1904.  34  Tex.  Civ.  App.  173. 


THE    STATE    OF    TEXAS  939 

Cancellation  of  Membership — Right  of  May  Exist. 

The  constitution  of  a  society  giving  its  directors  authority  to 
cancel  a  membership  when  deemed  advisable  by  them,  entered  into 
a  contract  of  insurance  with  the  member,  and  he  could  not  compel 
reinstatement  by  mandamus  when  on  account  of  increased  risk 
caused  by  the  loss  of  an  eye,  his  meml)ership  had  l)eeu  so  cancelled. 

Travelers  Protectiva  Assn.  vs.  Dewey,  Feb.,  19U4,  34  Tex.  Civ.  App. 
419. 

Contract,  When  Renounced,  Other  Party  May  at  Once  Sue. 

Where  one  party  to  a  fraternal  society  contract  announces  its 
intention  not  to  perform  it,  the  other  may  treat  the  contract  as  at 
an  end  and  recover  the  amounts  paid  under  it. 

Supreme  Council.  Am.  Legion  of  Honor  vs.  Batte,  Feb.,  1904,  34  Tex. 
Civ.  App.  456. 

Repudiation  of  Contract  Gives  Right  of  Suit  Under  Same. 

A  by-law  reducing  the  amount  payable  at  death  on  a  certificate, 
with  a  proviso  for  paying  the  sum  originally  named  so  long  as  the 
emergency  fund  of  the  order  has  not  been  exhausted,  was  a  repudia- 
tion of  its  contract  which  would  authorize  suit  by  the  holder  of  a 
benefit  certificate  to  recover  back  the  sums  paid,  though  there  were 
still  remaining  in  the  emergency  fund  a  large  sum  of  money. 

Supreme  Council,  Am.  Legion  of  Honor  vs.  Batte,  Feb.,  1904,  34  Tex. 
Civ.  App.  456. 

Election,  Not  Made  When  Payments  Are  Made  Under  Protest. 

The  fact  tliat  the  holder  of  a  benefit  certificate  continued  paying 
assessments  after  the  enactment  of  a  by-law  reducing  the  amount 
to  be  paid  on  death,  was  not  an  election  to  treat  the  contract  in  such 
altered  form  as  still  in  force,  where  the  payments  were  made  under 
protest  and  in  hope  of  the  repeal  of  the  by-law. 

Supreme  Council,  Am.  Legion  of  Honor  vs.  Batte,  Feb.,  1904.  34  Tex. 
Civ.  App.  456. 


940  FRATERNAL   SOCIETY   LAW 

Summons,  Service  on  Local  Officer  Good. 

Service  of  citation  in  an  action  against  a  foreign  fraternal  society 
domiciled  in  Kansas,  made  upon  the  president  of  a  local  lodge  of 
the  society  in  the  county  in  Texas  where  the  suit  was  brought  was 
a  sufficient  service  of  summons  upon  the  defendant  under  the  statute 
authorizing  j^roeess  against  a  foreign  corporation  to  be  served  upon 
any  local  agent  thereof,  and  the  provision  of  statute  allowing  service 
of  summons  upon  the  State  Insurance  Commissioner  is  held  to  be 
merely  cumulative  and  not  to  render  service  had  under  the  general 
statutes  as  to  foreign  corporations  ineffectual. 

Bankers  Union  vs.  Nabors,  May.  1904,  36  Tex.  Civ.  App.  38. 

Suicide — Coroner's  Verdict  Not  Admissible  in  Evidence. 

In  an  action  upon  a  death  benefit  certificate  containing  a  pro- 
vision voiding  the  certificate  in  case  of  suicide  within  three  years 
after  its  issuance,  it  was  reversible  error  to  admit  in  evidence  the 
record  of  the  inquest  held  over  the  deceased  in  which  the  coroner 
found  that  death  was  caused  by  suicide — the  findings  of  a  coroner's 
inquest  not  being  conclusive  of  the  facts  found. 

Boelime  vs.  Sovereign  Camp,  Woodmen  of  the  World,  June,  1904,  36 
Tex.  Civ.  App.  501. 

Dissolution  and  Reorganization  of  Lodges  Permissible. 

No  cause  of  action  is  shown  against  the  Grand  Lodge  by  per- 
mitting a  subordinate  lodge  to  disorganize  and  to  reorganize  itself 
in  accordance  with  the  laws  of  the  society,  though  this  is  done  by 
the  members  of  such  subordinate  lodge  for  the  purpose  of  getting 
rid  of  a  member  distasteful  to  them,  and  whom  they  left  out  in  re- 
organizing. 

Grand  Lodge,  Sons  of  Hermann  vs.  Schuetze,  Oct.,  1904,  36  Tex.  Civ. 
App.  539. 

Application — Questions  in  as  to  Habits  Construed. 

A  question  to  an  applicant,  "To  what  extent  do  you  use  intoxi- 


THE    STATE    OF    TEXAS  941 

eating  liquors"  and  "Have  ymi  always  been  temperate  in  their  use," 
were  for  the  purpose  of  ascertaining  the  extent  to  which  the  ap- 
plicant used  them,  and  not  whether  he  used  them  at  all. 

Endowment  Rank,  Supreme  Lodge  Knights  of  Pythias  vs.  Townsend. 
Oct.,  1904,  36  Tex.  Civ.  App.  651. 

Societies  May  Incorporate   in   Several  States — Consolidation   of — 
When  Unlawful. 

Where  corporations  are  created  by  different  States,  they  can  only 
consolidate  under  concurrent  legislation  by  each  State,  in  which 
event  there  is  a  separate  and  distinct  corporation  in  each  State,  as" 
the  laws  of  each  State  have  no  extra-territorial  effect.  In  the  ab- 
sence of  proof  to  the  contrary,  it  will  be  presumed  that  a  foreign 
fraternal  society  doing  business  in  Texas  was  created  for  the  pur- 
poses described  in  Section  1  of  the  act  of  1899,  and  hence  a  con- 
tract to  divert  its  benefit  fund  to  the  payment  of  certificates  issued 
by  another  corporation  with  which  it  had  no  power  to  consolidate, 
is  ultra  vires  and  void. 

Whaley  vs.  Bankers  Union,  Texas  Court  of  Civil  Appeals,  May,  1905, 
88  S.  W.  259. 

Conditions  Precedent  to  Liability. 

When  the  by-laws  of  a  society  provide  that  the  first  assessment 
and  dues  must  be  paid  by  the  applicant  and  forwarded,  together 
with  the  acceptance  of  the  certificate,  to  the  Supreme  Clerk  imme- 
diately upon  the  delivery  of  the  certificate,  it  is  not  necessary  to  the 
validity  of  the  certificate  that  the  member  should  execute  a  written 
acceptance. 

Sovereign  Camp,  Woodmen  of  the  World  vs.  Brown,  Tex.   Ct.   Civ. 
App.,  May,  1905,  88  S.  W.  372. 

Scaling  Certificates  Void. 

A  by-law  scaling  all  $5,000.00  certificates  to  $2,000.00  is  void,  and 


942  FRATERNAL    SOCIETY    LAW 

members  may  recover  premiums  paid  on  $5,000.00  certificates  after 
such  action  is  taken  b.v  the  society. 

Supreme  Council.  Am,  Legion  of  Honor  vs.  Lyon,  Tex.  Ct.  Civil  App., 
May,  1905,  S8  S.  W.  435. 

Beneficiaries — Illegitimate  Children  May  be  Named. 

When  the  constitution  of  a  society  provides  that  each  member 
shall  designate  certain  beneficiaries  who  shall  be  members  of  his 
family  or  some  one  related  to  him  by  blood  or  dependent  on  him, 
it  is  held  that  a  member  may  designate  an  illegitimate  daughter, 
she  being  related  to  him  by  blood  and  being  dependent  upon  him. 

Stahl  vs.  Grand  Lodge,  A.  O.  U.  W.,  Tex.  Ct.  Civ.  App.,  Nov.,  1906, 
98  S.  W.  643. 

Beneficiaries — Creditors  Cannot  be,  But  They  May  Secure  Return 
of  Assessments  Paid  by  Them  to  Keep  Contract  Alive. 

A  member  being  unable  to  pay  his  dues  and  assessments,  allowed 
his  certificate  to  lapse,  but  subsequently  an  agreement  was  entered 
into  between  him  and  the  beneficiaries  on  the  one  part  and  a 
stranger,  by  which  the  latter  agreed  to  pay  the  money  required  to 
reinstate  the  insured  and  to  make  subsequent  payments  sufficient 
to  keep  the  certificate  in  force  during  the  life  of  the  member,  for 
which  he  was  to  be  reimbur.sed  out  of  the  proceeds  of  the  certificate. 
Before  the  death  of  the  member  the  beneficiaries  died,  and  no  new 
designation  was  made.  Thereafter  the  member  attempted  by  his  will 
to  make  a  change  in  favor  of  the  stranger,  and  it  was  held  that  the 
fund  became  payable  to  the  member's  children  under  the  provisions 
of  the  laws  of  the  society,  and  could  not  be  subjected  to  the  plain- 
tifi^'s  claim  for  reimbursement  imder  his  contract  with  the  member. 

Searcy  vs.  Kelly,  Tex.  Ct.  Civ.  App.,  Dec,  1906,  98  S.  W.  1080. 

(The  above  case  went  to  the  Supreme  Court  and  was  there  de- 
cided, May,  1907,  102  S.  W.  100,  and  that  court  reversed  the  Court 
of  Civil  Appeals  and  held  that  the  children  of  the  member,  having 


THE    STATE    OF    TEXAS  943 

received  the  benefit  of  the  contract  made  with  the  original  bene- 
ficiaries, for  the  preservation  of  the  certificate  through  the  payment 
of  the  installments  which  fell  due  at  different  times,  the  funds 
which  they  thereby  received  should  be  subjected  to  the  plaintiff's 
claim  for  reimbursement.) 

Conditions  Precedent. 

A  member  made  application  to  join  the  Woodmen,  complied  with 
all  the  requirements,  and  a  certificate  was  issued,  but  through  mis- 
take was  sent  to  the  wrong  local  camp,  and  before  the  mistake  was 
corrected  and  the  certificate  sent  to  the  right  camp  for  delivery,  the 
member  was  killed.  He  had  offered  to  pay  the  first  assessment, 
which  was  due  when  the  certificate  was  delivered.  The  application 
and  the  laws  provided  that  no  liability  for  benefit  should  accrue 
until  the  certificate  was  personally  delivered  to  the  member  and 
he  had  paid  one  assessment.  Held,  That  the  beneficiary  named  in 
the  certificate  could  recover  under  the  same. 

Sovereign  Camp,  Woodmen  of  the  World  vs.  Dees,  Tex.  Ct.  Civ.  App., 
Feb.,  1907,  100  S.  W.  366. 

Total  Disability,  What  is. 

The  by-laws  of  a  society  provided  that  whenever  any  member 
became  permanently  and  totally  disabled  from  pursuing  the  or- 
dinary vocations  of  life,  he  should  be  entitled  to  receive  one-half 
of  his  certificate.  One  form  of  permanent  total  disability  was  de- 
clared to  be  insanity,  so  adjudged,  by  the  courts.  In  an  action  it 
was  held  that  in  order  to  recover  on  the  certificate  on  the  ground 
of  insanity,  it  must  be  shown  to  be  such  a  degree  of  insanity  as 
would  authorize  an  adjudication  of  the  insured's  mental  status  by 
the  courts. 

Knipp  vs.  United  Benev.  Assn.,  Tex.  Ct.  Civ.   App.,  Feb.,  1907,  101 
S.  W.  273. 

Application,  Misstatements  in. 

A  misstatement  in  an  application  concerning  proper  medical  at- 


944  FRATERNAL    SOCIETY   LAW 

tendance  and  treatment  of  the  applicant  was  not  material  to  the 
risk  as  a  matter  of  law.  hut  its  materiality  depended  on  the  sur- 
rounding circumstances.    For  the  facts  in  such  case,  see 

Modern  Order  of  Praetorians  vs.    HoUmig,    Tex.    Civ.    App.,    March, 
1907,  103  S.  W.  474. 

Fraternal  Societies  Exempt  From  General  Insurance  Laws. 

The  provisions  of  the  act  of  1903  declaring  that  any  provision  in 
an  insurance  policy  contracted  for  in  Texas,  that  the  answers  or 
statements  in  the  application,  if  false,  shall  render  the  policy  void 
or  voided,  shall  not  constitute  a  defense  unless  shown  to  be  ma- 
terial to  the  risk,  is  held  applicable  to  fraternal  societies  as  well  as 
corporations  conducting  an  ordinary  life  insurance  business. 

Modern  Order  of  Praetorians  vs.    Hollmig,    Tex.    Civ.    App.,    March, 
1907,  103  S.  W.  474. 

(This  case  was  heard  on  jietition  for  rehearing  in  June,  1907, 
reported  in  103  S.  W.  476,  and  upon  this  point  the  court  reversed 
itself,  holding  that  said  section  of  the  acts  of  1903,  (did  not  apply 
to  fraternal  beneficiary  societies,  inasmuch  as  they  were  by  the  acts 
of  1899  not  subject  to  the  insurance  law  of  the  State.) 

Agency  of  Medical  Examiner. 

In  the  absence  of  a  limitation  on  the  authority  of  the  medical  ex- 
aminer expressed  in  the  contract  of  insurance,  he  will  be  held  to 
be  the  agent  of  the  society  while  performing  the  duties  of  his  posi- 
tion. 

Modern  Order  of  Praetorians  vs.    Hollmig,    Tex.    Civ.    App.,    March, 
1907.  103  S.  W.  474. 

Beneficiary — Who  is  of  Monument  Fund  in  Woodmen. 

A  benefit  certificate  for  $1,000.00  on  the  life  of  the  deceased,  pay- 
able to  his  wife,  provided  also  that  there  should  be  paid  $100.00  for 
a  inonument  to  be  erected  at  the  member's  grave,  but  the  society 


THE    STATE    OF    TEXAS  945 

did  mil  I'ctain  the  privilege  of  delivering  the  monument  or  perform- 
ing any  duties  connected  with  the  member's  burial,  and  there  was 
no  express  provision  as  to  whom  the  money  should  be  paid.  Held, 
That  it  should  be  paid  to  the  member's  widow. 

Woodmen  of  the  World  vs.  Torrence,  Tex.  Civ.  App.,  June,  1907,  103 
S.  W.  652. 

Contract  Provisions,  When  to  be  Construed  Most  Strictly  in  Favor 
of  Beneficiary. 

The  rule  that  an  insurance  contract  must  be  construed  most  liber- 
ally in  favor  of  the  beneficiaiy  has  no  application  where  there  is  no 
ambiguity  or  uncertainty  in  the  language  sought  to  be  construed. 

Continental   Casualty   Co.   vs.   Wade,    Supreme   Ct.   Tex.,   Nov.,   1907, 
105  S.  W.  35. 

Assessments,  Mailing  Draft  Not  Payment. 

On  December  23  a  draft  covering  dues  and  assessments  payable 
before  the  end  of  the  month  was  mailed,  in  Louisiana,  to  one  in 
Texas  who  had  been  the  local  collector,  but  who  had  resigned  on 
December  12.  It  was  held  not  to  be  payment  to  the  society,  and 
neither  the  .society  nor  its  collector  having  received  payment,  the 
member  was  properly  suspended  where,  under  the  laws  of  the  so- 
ciety, failure  to  make  payment  before  the  last  day  of  the  month 
operated  as  a  suspension  of  the  member  without  notice. 

Supreme  Lodge  of  the  Pathfinder  vs.  Johnson,  Tex.  Civ.  App.,  June, 
1907,  104  S.  W.  508. 

Beneficiary — Revoked  and  Illegal  Designation — Rule  in  Such  Cases. 

The  surrender  of  an  original  certificate  to,  and  acceptance  thereof 
by,  the  Grand  Lodge,  and  the  issuance  of  another  certificate  naming 
another  beneficiary,  revoked  the  original  certificate  and  destroyed 
the  rights  of  the  beneficiary  named  therein,  thoiigh  the  designation 
of  the  beneficiarj^  in  the  second  certificate  was  illegal,  and  the  benefit 
60 


946  FRATERNAL    SOCIETY    LAW 

was  payable  to  those  entitled  to  it  imder  the  statute,  in  the  order 
of  precedence  named  therein. 

Grand  Lodge,  Colored  Knights  of  Pythias  vs.  Mackey,  Tex.  Civ.  App., 
Oct.,  1907,  104  S.  W.  907. 

Beneficiary,  Society  May  Waive  Provisions  Respecting  Change  of. 

When  a  member  changed  the  beneficiary  in  accordance  with  the 
instructions  of  the  Grand  Lodge  through  its  officers,  but  not  in  ac- 
cordance with  the  by-laws  of  the  society,  and  the  society  acquiesced 
in  the  cliange  and  paid  the  fund  into  court  for  it  to  determine 
whether  it  should  be  paid  to  the  original  beneficiary  or  to  the  new 
one,  the  original  beneficiary  could  not  raise  the  question  of  non- 
compliance with  the  bj'-laws,  and  is  was  held  that  the  new  bene- 
ficiary was  entitled  to  the  fund. 

Coleman   vs.   Grand   Lodge,   Colored   Knights   of   Pythias,   Tex.   Civ. 
App.,  Oct.,  1907,  104  S.  W.  909. 


THE     HTATE     OF     UTAH  947 


THE 

STATE  OF  UTAH. 

CHAPTER  45. 

The  State  of  Utah  lias  110  statute  hiw  applicable  to  Fraternal  So- 
cieties except  Section  418,  Chapter  5  of  the  laws  relating  to  insurance 
corporations,  which  reads  viz. : 

Chapter  Not  Applicable  to  Social,  Etc.,  Organizations. 

"See.  418.  Nothing  in  this  chapter  shall  be  construed  to  apply 
to  any  organization  of  a  purely  social,  religious,  or  benevolent  char- 
acter, where  no  commissions  are  paid  and  no  salaried  officers  or 
agents  employed ;  or  to  any  local  association  or  society  organized 
under  or  subject  to  the  control  of  a  grand  or  supreme  body,  or  to 
any  secret  organizations  having  subordinate  lodges  or  councils  which 
have  been  organized  or  may  organize  under  the  laws  of  this  or  any 
other  State  or  territory,  and  which  may  do  business  in  this  State; 
or  to  commercial  organizations,  such  as  boards  of  trade  or  cham- 
bers of  commerce,  organized  under  the  provisions  of  the  general  in- 
corporation laws  for  the  promotion  of  general  public  interests  and 
having  in  connection  therewith  the  incidental  features  of  a  mortuary 
benefit  fund  which  shall  not  be  collected  and  distributed  for  pe- 
cuniary profit  to  the  corporation." 

Sick  Benefits,  Right  to  Survives. 

A  cause  of  action  in  favor  of  a  member  to  recover  sick  benefits 


948  FRATERNAL    SOCIETY   LAW 

payable  to  him  during  his  lifetime  survives  his  death  and  may  be 
brought  by  his  administrator. 

Pearson  vs.  Anderburg,  March,  1905,  28  Utah  495;  80  Pac.  307. 

Funeral  Benefits,  Administrator  May  Recover. 

An  administrator  may  recover  an  allowance  of  funeral  expenses 
due  on  the  death  of  a  member,  where  same  are  provided  for  by  the 
laws  of  the  society  but  are  no{  declared  payable  to  any  particular 
person. 

Pearson  vs.  Anderburg,  March,  1905,  28  Utah  495;  80  Pac.  307. 

Voluntary  Society,  Suit  Against. 

A  voluntary  societ.y  cannot  be  sued  in  its  name  as  such,  but  can 
be  brought  into  court  only  in  the  name  of  its  members,  or  if  they 
are  too  numerous,  a  few  of  them  may  be  made  defendants  to  repre- 
sent the  interests  of  all. 

Pearson  vs.  Anderburg,  March,  1905,  28  Utah  495;  80  Pac.  307. 

Resort  to  Civil  Courts,  Right  of. 

The  members  of  a  voluntary  societj'  may  restrict  themselves  as 
to  matters  incidental  to  the  operations  of  the  society,  and  to  reme- 
dies before  tribunals  created  by  them,  but  such  restrictions  cannot 
extend  to  the  right  to  benefits  due  the  members  under  contracts  so 
as  to  require  them  to  exhaust  the  remedies  provided  by  the  tri- 
bunals of  the  society  as  a  condition  precedent  to  bringing  suit. 

Pearson  vs.  Anderburg,  March,  1905,  28  Utah  495;  80  Pac.  307. 

Beneficiary,  Change  of  Rules  as  to. 

Where  the  contract  provides  for  a  change  of  beneficiary  by  sur- 
render of  the  old  certificate,  an  attempt  to  make  a  change  without 
following  such  provision  is  not  excused  by  the  failure  of  the  member 
to  understand  the  laws  of  the  society. 

Sterling  vs.   Head   Camp,  Woodmen   of  the  World,   March,   1905,  28 
Utah  505;   80  Pac.  375. 


THE     STATE     OF     UTAH  949 

Agency,  Local  Officials  Cannot  Waive  Laws. 

The  provisions  of  tlu"  laws  to  the  effect  tliat  local  lodge  officials 
shall  not  possess  the  express  or  implied  authority  t<i  waive  the  terms 
of  contract,  are  binding  on  the  members. 

Sterling  vs.   Head   Camp.   Woodmen   of  the  World,   March,   1905,  28 
Utah  505;   80  Pac.  375. 

Conditions  Precedent  as  to  Delivery  of  Certificate. 

Where  the  contract  provides  that  no  liability  shall  arise  under 
it  until  its  delivery  to  and  acceptance  in  writing  by  the  member, 
the  issuance  of  a  certificate  which  is  not  so  delivered  and  accepted 
is  of  no  effect  and  creates  no  liability  on  the  part  of  tlie  society. 

Sterling  vs.   Head   Camp,  Woodmen   of  the  World,   March,   1905,  28 
Utah  505;   80  Pac.  375. 

Beneficiaries,  Right  in  Member  to  Change  Absolute. 

Where  the  contract  provided  for  a  change  of  beneficiary  by  the 
surrender  of  the  certificate  and  the  issuance  of  a  new  one,  the 
motives  or  reasons  which  induced  the  member  to  attempt  to  change 
the  beneficiar.v  hy  permitting  his  membership  to  lapse  as  a  prelimi- 
nary to  taking  out  a  new  certificate,  instead  of  following  the  pro- 
visions of  the  contract,  were  immaterial  on  the  right  of  the  con- 
templated beneficiary  to  recover  the  amount  of  the  certificate. 

Sterling  vs.  Head  Camp,  Woodmen  of  the  World,  May,  1905,  28  Utah 
526;  80  Pac.  1110. 

Ambiguous  Laws,  How  to  be  Construed. 

The  by-laws  of  a  society  when  susceptible  of  two  constructions 
must  receive  that  one  which  will  more  nearly  carry  out  the  objects 
and  purposes  of  the  society  and  sustain  the  claim  of  the  injured  one. 

Maynard  vs.   Locomotive  Engineers'  Mut.  Life  and   Accident  Assn., 
Nov.,  1897,  16  Utah  145. 


1 


950  FRATERl^AL    SOCIETY    LAW 

Proofs  of  Loss,  Requirements  for. 

The  provision  in  a  contract  requiring  proofs  of  death  to  be  fur- 
nished within  two  months  from  the  date  of  the  member's  death,  in 
default  of  which  all  claims  under  the  contract  shall  be  forfeited, 
is  a  condition  subsequent  and  is  fulfilled  by  a  submission  of  proofs 
within  a  reasonable  time  after  the  death  of  the  member. 

Munz  vs.  The  Standard  Life  and  Accident  Ins.  Co.,  April,   1903,   26 
Utah  69. 

Agency  of  Local  Lodge  and  Officials. 

A  subordinate  lodge  and  its  financial  officer  are  agents  of  the 
Grand  Lodge  and  not  of  the  member. 

Johanson  vs.   Grand   Lodge,  A.   O.  U.  W.,   Supreme  Court  of  Utah, 
July,  1906,  86  Pac.  494. 

Assessments,  Duty  of  Lodge  to  Pay  When  There  Are  Funds  in  Hand. 

A  member,  on  becoming  impecunious  and  in  ill  health,  applied  to 
his  local  lodge  for  relief,  and  was  notified  by  it  that  it  would  make 
a  loan  to  him  for  four  months'  assessments;  that  such  application 
would  carry  his  dues  and  assessments  for  four  months,  and  that  at 
the  expiration  of  that  time  he  would  have  to  make  a  further  appli- 
cation to  the  lodge.  It  was  held  that  the  subordinate  lodge  then 
having  money  on  hand  applicable  to  the  purpose,  such  loan  con- 
stituted an  appropriation  of  so  much  funds  of  the  subordinate  lodge 
as  was  necessary  to  pay  such  assessments,  and  that  they  were  to  be 
regarded  as  paid,  so  far  as  the  member's  certificate  was  concerned. 

Johanson  vs.   Grand   Lodge,   A.   O.   U.  W.,   Supreme  Court  of  Utah, 
July,  1906,  86  Pac.  494. 

Assessments — Agency  of  Local  Lodge,  Etc. 

By  the  provisions  of  the  laws  of  a  society  its  subordinate  lodges 
were  bound  to  see  that  the  assessments  were  collected,  and  they 
were  given  express  power  to  suspend  members  for  non-payment  of 


THE     STATE     OF     UTAH  951 

assessments,  and  to  reinstate  them  on  pajanent  of  arrearages  with- 
out notice  to  or  direction  from  the  Grand  Lodge.  Through  the  ex- 
ercise of  its  powers  of  suspension,  the  subordinate  lodge  was  author- 
ized to  annul  the  insurance  of  any  member,  to  revalidate  same,  to 
determine  the  good  standing  of  its  members  which  was  requisite  to 
the  validity  of  the  insurance,  and  was  given  other  jiowers  in  respect 
to  members  which  directh^  affected  their  rights  in  and  to  the  eon- 
tract  of  insurance.  It  was  held  that  such  subordinate  lodge  was  not 
a  mere  collecting  agent,  but  was  authorized  to  waive  the  strict  com- 
pliance with  the  society's  by-laws  relating  to  payments  of  assess- 
ments. 

Johanson  vs.  Grand  Lodge,  A.  O.  U.  W.,  Supreme  Court  of  Utah, 
July,  1906,  86  Pac.  494. 


1" 


952  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  VERMONT. 

CHAPTER  46. 

Section  1.  A  fraternal  beneficiary  association  is  hereby  declared 
to  be  a  corporation  society,  or  voluntary  association,  formed  or  or- 
ganized and  carried  on  for  the  sole  benefit  of  its  members  and  their 
beneficiaries,  and  not  for  profit,  having  a  lodge  system,  with  ritual- 
istic form  of  work,  and  representative  form  of  government,  making 
provisions  for  the  payment  of  benefits  in  the  case  of  death,  sickness, 
temporary  or  permanent  physical  disability,  either  as  the  result  of 
disease,  accident,  or  old  age,  provided  the  period  in  life  at  which 
payment  of  physical  disability  benefits  on  account  of  age  commences 
shall  not  be  under  the  expectation  of  life  according  to  the  "Ameri- 
can Experience  Table,"  subject  to  their  compliance  with  its  consti- 
tution and  laws.  The  fund  from  which  the  payment  of  such  benefits 
shall  be  made,  and  the  fund  from  which  the  expenses  of  such  asso- 
ciation shall  be  defrayed,  shall  be  derived  from  assessments  in  dues 
collected  from  its  members. 

Payment  of  death  benefits  shall  be  to  the  families,  heirs,  blood 
relatives,  affianced  husband  or  affianced  wife  of,  or  to  persons  de- 
pendent upon,  the  members.  Such  association  shall  be  governed  by 
this  act,  and  shall  be  subject  to  the  provisions  of  the  insurance  laws 
of  this  State  consistent  with  the  provisions  of  this  act. 

Section  2.  All  such  associations  coming  within  the  description  set 
forth  in  Section  1  of  this  act,  organized  \;nder  the  laws  of  this  or 
any  other  State,  province  or  territory,  and  now  doing  business  in 
this  State,  may  continue  such  business,  provided  that  they  hereafter 
comply  with  the  provisions  of  this  act  and  the  insurance  laws  of  this 


THE    STATE    OF    VERMONT  953 

State  in  regard  to  annual  reports,  and  ajipnint  the  Secretary  of  State 
their  attorney  for,  and  comply  with  the  provisions  of  the  general 
law  relating  to  service  of  in-ocess  on  foreign  corporations. 

Section  3.  Such  associations  organized  under  the  laws  of  any 
other  State,  province  or  territory,  and  not  now  doing  business  in 
this  State,  may,  at  the  discretion  of  the  Insurance  Commissioners, 
be  admitted  to  do  business  within  this  State  when  it  shall  be  shown 
to  the  satisfaction  of  the  Insurance  Commissioners  to  be  conducting 
its  business  in  accordance  with  the  provisions  of  this  act,  and  shall 
have  filed  with  the  Insurance  Commissioners  a  duly  certified  copy  of 
its  charter  and  articles  of  association,  and  a  copy  of  its  constitution 
and  by-laws,  certified  to  by  its  secretary  or  corresponding  officer, 
together  with  an  appointment  of  the  Secretary  of  State,  as  a  person 
upon  whom  process  may  be  served,  and  a  statement  under  oath  of  its 
president  and  secretary,  showing  its  financial  condition  and  such 
other  information  as  the  commissioners  deem  necessary,  and  pro- 
vided that  such  association  shall  be  shown  by  certificate  to  be  au- 
thorized to  do  business  in  the  State,  province  or  territory  in  which 
it  is  incorporated  or  organized. 

Section  4.  If  the  Insurance  Commissioners  are  satisfied  with  such 
copies  and  statements  as  are  furnished  by  any  such  association  com- 
ing within  the  description  set  forth  in  Section  1  of  this  act,  organ- 
ized under  the  laws  of  this  or  any  other  State,  province  or  territory, 
and  that  such  association  has  complied  with  the  provisions  of  this 
act,  they  shall  issue  to  such  association  a  permit  in  writing,  authori- 
zing such  association  to  do  business  within  this  State,  for  which  cer- 
tificate such  association  shall  pay  to  said  commissioners  the  fee  of 
five  dollars. 

Section  5.  Fraternal  beneficiary  associations  doing  business  in 
this  State  shall  annually,  in  accordance  with  Section  4202  of  the  Ver- 
mont statutes,  transmit  a  report  to  the  Insurance  Commissioners; 
and  shall,  at  any  time  upon  demand  of  the  Insurance  Commissioners, 
furnish  under  oath  such  information  regarding  the  busine.ss  and 
condition  of  the  association  as  the  Insurance  Commissioners  shall 
require. 

Section  6.  [As  amended  by  No.  59,  Acts  of  1900.]  Such  associa- 
tions shall  not  employ  paid  agents  in  soliciting  or  procuring  mem- 


954  FRATERNAL    SOCIETY    LAW 

bers,  except  in  the  preliminary  organizing  of  subordinate  bodies,  but 
associations  now  doing  business  in  the  State  may  employ  members 
to  assist  membei-s  of  weak  and  inactive  local  branches  to  increase 
their  membership,  provided  their  compensation  does  not  depend 
upon,  and  is  not  affected  by  such  increase,  and  is  not  in  excess  of 
three  doUars  per  day.  Such  agents  and  members  shall  require  no 
license.  An,y  person  failing  to  comply  with  the  provisions  of  this 
act,  or  who  shall  solicit  membership  for,  or  in  any  way  assist  in  pro- 
curing membership  in,  or  aid  in  the  transaction  of  any  business  for 
any  fraternal  beneficiary  association  not  authorized  to  do  business 
in  this  State,  shall  be  punished  by  a  fine  of  not  less  than  fifty  or  more 
than  two  hundred  dollars. 

Section  7.  Any  per.son.  officer,  member  or  examining  physician, 
who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent  state- 
ments or  representations,  in  or  with  reference  to  any  application  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit 
in  any  association  transacting  business  under  this  act,  shall  be  guilty 
of  a  misdemeanor,  and  upon  conviction  shall  be  punished  by  a  fine 
of  not  less  than  one  hundred  dollars  nor  more  than  five  hundred 
dollars,  or  imprisonment  in  the  house  of  correction  for  not  less  than 
thirty  days  nor  more  than  one  year,  or  both,  in  the  discretion  of  the 
court,  and  any  person  who  shall  wilfully  make  a  false  statement  of 
any  material  facts  or  things  in  a  sworn  statement  as  to  the  death 
or  disability  of  a  certificate  holder  in  any  such  association  for  the 
purpose  of  procuring  payment  of  a  benefit  named  in  the  certificate 
of  such  holder,  and  any  person  who  shall  wilfully  make  any  false 
statement  in  anj-  verified  report  or  declaration  under  oath  required 
or  authorized  by  this  act  shall  be  guilty  of  a  perjury,  and  shall  be 
proceeded  against  and  punished  as  provided  by  the  statutes  of 
this  State  in  relation  to  the  crime  of  perjury. 

Section  8.  Any  such  association  refusing  or  neglecting  to  make 
the  reports  or  furnish  the  statements  or  the  information  provided 
for  in  this  act,  shall  be  excluded  from  doing  business  within  this 
State.  The  Insurance  Commissioners  must  within  sixty  days  after 
failure  to  make  such  report,  or  in  ease  any  such  association  shall 
exceed  its  powers,  or  shall  conduct  its  business  fraudulently  or  shall 
fail  to  comply  with  any  of  the  provisions  of  this  act,  apply  to  the 


THE    STATE    OF    VERMONT  955 

court  of  chancery  for  an  injiinetioii  a<;aiiisf,  such  association  to 
enjoin  the  same  from  carrying  on  any  business.  No  association  so 
enjoined  shall  have  authority  to  continue  business  until  such  report 
shall  be  made,  or  overt  act  oi-  violations  eomj)lained  of  shall  have 
been  corrected,  nor  until  the  costs  of  such  action  be  paid  })y  it,  pro- 
vided the  court  shall  find  that  such  association  was  in  default  as 
charged,  whereupon  the  insurance  commissioners  shall  in  their  dis- 
cretion reinstate  such  association,  and  not  until  then  shall  such  asso- 
ciation be  allowed  to  again  do  business  in  the  State. 

Any  officer,  agent  or  person  acting  for  any  association  or  subor- 
dinate body  thereof,  within  this  State,  while  such  association  shall  be 
so  enjoined  or  prohibited  from  doing  business  pursuant  to  this  act, 
shall  be  deemed  guilty  of  a  misdemeanor,  and  on  conviction  thereof 
shall  be  punished  b.y  a  fine  not  less  than  twenty-five  dollars,  nor 
more  than  two  hundred  dollars,  or  by  imprisonment  in  the  house  of 
correction  not  less  than  thirty  days  nor  more  than  one  year,  or  by 
both  such  fine  and  imprisonment  in  the  discretion  of  the  court. 

Section  9.  Every  society  or  association  to  which  this  act  is  appli- 
cable shall  pay  the  following  fees  to  the  insurance  commissioners : 
For  filing  a  certified  copy  of  its  charter  or  articles  of  association  and 
other  papers  as  provided  by  this  act,  five  dollars;  for  filing  the 
annual  report  as  herein  provided,  five  dollars;  for  filing  anj'  addi- 
tional papers  required  by  law,  twenty-five  cents. 

Section  10.  Nothing  herein  shall  apply  to  or  in  any  way  interfere 
with  the  orders  known  as  Masons,  Odd  Fellows,  Knights  of  Pythias 
or  similar  ordei-s,  or  any  association  which  limits  its  certificate  hold- 
ers to  the  employes  of  a  firm  or  municipal  or  other  corporation. 

Section  1  of  an  act  of  the  General  Assembly  approved  Nov.  27, 
1900,  and  now  in  force  provides  as  follows:. 

Section  1.  No  fraternal  beneficiary  association  not  already  doing 
business  within  this  State  prior  to  the  passage  of  this  act  shall  be 
incorporated  or  given  a  permit  or  license  to  transact  business  within 
this  State,  unless  it  shall  first  show  that  the  mortuary  assessment 
rates,  proyided  for  in  whatever  plan  of  business  it  has  adopted,  are 
not  lower  than  is  indicated  as  necessary  by  the  mortality  table  rec- 
ommended by  the  National  Fraternal  Congress  and  known  as  the 
"Fraternal  Congress  Mortalitv  Table." 


956  FRATERNAL    SOCIETY    LAW 

The  following  provisions  of  the  general  laws  of  the  State  of  Ver- 
mont seem  also  to  apply  to  Fraternal  Societies : 

Section  1.  In  actions  brought  to  recover  on  a  fire,  life,  or  accident 
insurance  policy,  the  general  covints  in  assumpsit  shall  be  a  sufficient 
declaration,  and  no  other  or  different  one  shall  be  required.  The 
plea  of  non-assumpsit  shall  put  in  issue  only  the  execution  of  the 
policy  and  the  amount  of  damages  sustained  thereunder. 

Section  2.  The  plaintiff  in  such  action  shall  file  with  the  writ  in 
the  office  of  the  clerk  of  the  coiirt  to  which  the  same  is  returnable, 
a  specification  giving  the  number  of  the  policy  upon  which  such 
suit  is  predicated,  the  date  of  the  fire,  death  or  accident  as  the  case 
may  be,  and  the  items  of  the  policy  involved  in  the  claim,  if  the 
policy  contains  more  than  one  item. 

Act  approved  Nov.  23,  1S96. 

Section  4:165.  No  foreign  insurance,  express,  shipping  ear,  tele- 
graph or  telephone  company,  or  a  foreign  company  under  any  other 
name  engaged  in  like  business,  whether  said  company  is  a  corpora- 
tion or  co-partnership,  shall  do  business  in  this  State,  until  it  has 
filed  with  the  secretary  of  state  a  written  stipulation,  containing 
the  name  of  the  corporation  and  the  place  where  chartered,  or,  if 
a  co-pai'tnership,  the  firm  name  and  the  names  and  residences  of 
the  co-partners,  and  agreeing  that  legal  process  affecting  such  com- 
pany, served  on  said  secretary  of  state,  shall  have  the  same  effect 
as  if  served  personally  on  said  corporation  or  co-partners  within 
this  State ;  and  such  stipulation  shall  not  be  revoked  or  modified  so 
long  as  any  resident  of  this  State  has  a  cause  of  action  against  the 
stipulating  company. 

Section.  4166.  Service  of  process  according  to  the  stipulation 
shall  be  sufficient,  and  a  copy  of  such  stipulation  certified  by  said 
secretary  of  state,  and  his  certificate  that  process  has  been  served 
on  him,  shall  be  sufficient  evidence  thereof. 

Section  4167.  Process  against  or  affecting  any  such  foreign  cor- 
poration, company  or  co-partnership  may  be  served  on  the  secretary 
of  state  by  duplicate  copies,  one  of  which  shall  be  immediately  for- 
warded by  the  secretary  of  state,  by  mail,  prepaid,  to  the  corpora- 
tion, company  or  co-partnership  at  its  home  office  or  to  a  person 


THE    STATE    OF    VERMONT  957 

whom  it  designates ;  and  there  shall  be  paid  to  tlie  secretary  of  state 
by  the  officer  at  the  time  of  such  service  the  sum  of  one  dollar. 

Section  41GS.  If  a  person  or  agent  for  a  foreign  insurance  ex- 
press, shipping  car,  telegraph  or  telephone  company,  or  other  for- 
eign company  doing  like  business,  which  has  not  complied  with  the 
requirements  of  this  chapter,  solicits  or  receives  a  risk  or  application 
for  insurance,  or  receives  money  or  value  for  such  insurance  by  such 
company,  or  receives  money  or  value  for  tlie  transi)ortati()n  of  a 
package  or  property  b.y  such  express  or  shipjiing  car  company,  or 
for  the  transmission  of  a  message  or  dispatch  by  such  telegraph 
company,  or  receives  money,  rent,  royalty,  or  income  for  such  tele- 
phone company  for  the  use  of  its  instruments  or  lines,  or  for  the 
sending  of  any  message,  he  shall  be  fined  not  more  than  five  hiuidred 
dollars  and  not  less  than  one  hundred  dollars. 

Section  4169.  If  a  foreign  insurance,  express,  shipping  car,  tele- 
graph or  telephone  company,  or  other  foreign  company  doing  like 
business  in  this  State,  does  not  comply  wnth  the  jn'ovisions  of  this 
chapter,  process  against  it  may  be  served  by  drlivering  a  true  and 
attested  copy  thereof,  with  the  officer's  return  tlu'reon,  to  an  agent, 
messenger  or  operator  of  such  company  residing  in  this  State. 

Section  4170.  The  court  before  which  any  such  action  is  pending 
may  allow  an  amendment  of  the  writ  by  striking  out  any  of  the  de- 
fendants; or  by  the  addition  of  others,  on  .such  terms  as  to  the  court 
seems  just. 

"Illness"  Defined. 

The  word  "illness,"  as  used  in  questions  to  an  applicant  for  life 
insurance  means  a  disease  or  ailment  of  such  character  as  to  seriously 
affect  the  general  soundness  and  healthfulness  of  the  system,  and  not 
a  mere  temporary  indisposition. 

Billings  vs.  Metropolitan  Lite  Ins.  Co.,  Jan.,  1898,  70  Vt.  477. 

"Fraud"  and  "Breach  of  Warranty,"  Meaning  of  Terms. 

Fraud  may  be  predicated  upon  the  suppression  of  truth,  but  breach 
of  warranty  must  be  based  on  the  affirmation  of  something  not  true. 
Even  a  warrantv  that  the  answers  are  full,  means  that  thev  are  full 


958  FRATERNAL    SOCIETY    LAW 

in  the  sense  that  the  applicant  has  not  intentionally  concealed  or 
withheld  any  material  fact  or  circumstance. 

Billings  vs.  Met.  Life  Ins.  Co.,  Jan.,  1898,  70  Vt.  477. 

Contract,  Situs  of. 

An  application  made  by  a  resident  of  one  State  to  a  life  insurance 
concern  with  a  home  office  in  another  State,  which  is  accepted  in 
the  latter  State  and  contract  issued  and  deposited  in  the  mail, 
addressed  to  the  applicant,  is  held  to  be  a  contract  of  the  State  where 
the  contract  was  deposited  in  the  mail,  and  that  it  took  effect  upon 
such  deposit. 

Baker  vs.  Spaulding  Brothers,  Oct.,  1898,  71  Vt.  169. 

Limitation  Clauses  Respecting  Bringing  of  Suits,  Valid. 

The  iirovision  in  a  contract  that  no  suit  shall  be  brought  unless 
commenced  within  twelve  months  from  the  date  of  the  loss,  is  valid. 

Morrill  vs.  New  England  Ins.  Co.,  Jan.,  1S99,  71  Vt.  281. 

Agency  of  General  and  Local  Agents, 

The  clause  in  an  insurance  contract  providing  that  no  agent  has 
power  on  behalf  of  the  company  to  extend  the  time  for  paying  a 
premium,  is  held  to  refer  to  local  agents  and  not  to  general  agents, 
and  that  the  latter  are  premised  to  possess  authority  to  transact  the 
business  of  the  company  generally,  and  certainly  such  as  relates  to 
the  procurement  and  continuance  of  risks. 

Fraser  vs.  Home  Life  Ins.  Co.,  May,  1899,  71  Vt.  482. 

Forfeiture,  Waiver  and  Custom. 

The  fact  that  the  company  accepts  one  premium  after  it  has 
become  due  and  the  policy  forfeited,  may  justify  the  holder  in 
believing  that  the  company  would  accept  another  premium  under 


THE    UTATE    OF    VERMONT  959 

like  circumstances,  but  would  not  justify  liim  in  believiuH'  that  his 
policy  would  remain  in  force  whether  he  paid  the  premium  or  not. 

Fraser  vs.  Home  Life  Ins.  Co.,  May,  1899,  71  Vt.  482. 

Occupation — "Cattle  Shipper"  Defined. 

The  term  "cattle  shipjier  or  tender,"  used  to  designate  an  occupa- 
tion classed  as  hazardous,  does  not  include  a  horse  shipper  or  tender. 

Prink's  Admr.  vs.  Brotherhood  Accident  Co.,  May,  1902,  75  Vt.  249. 

Members  Presumed  to  Know  Laws  of  Society. 

The  members  of  mutual  societies  are  presumed  to  have  knowledge 
of  the  b.y-laws  of  the  society,  and  are  bound  by  them. 

Wilson  vs.  Union  Mut.  Ins.  Co.,  May,  1904,  77  Vt.  28. 

Accord  and  Satisfaction,  Etc.  < 

Where  a  creditor  accepts  in  sati.sfactiou  of  his  debt  the  mere 
promise  of  the  debtor  to  do  some  act  which  he  is  not  already  legally 
bound  to  perform,  that  promise,  though  never  fulfilled,  constitutes 
an  executed  accord  and  extinguishes  the  debt,  but  a  promise  to 
perform  the  promisor's  subsisting  legal  contract  with  the  promise, 
affords  no  consideration  for  the  latter 's  promise,  creates  no  duty 
and  cannot  support  an  action. 

Manley  vs.  Vermont  Mut.  Ins.  Co.,  February,  1906,  78  Vt.  331. 

Warranty — Belief  in  Truth  of  Ansv^ers  Immaterial. 

Where  the  contract  is  issued  partly  in  con.sideration  of  the  ap- 
plicant's answers  and  statements  contained  in  his  application,  which 
answers  and  statements  are  by  the  terms  of  the  contract  made 
warranties  and  a  part  thereof,  if  any  siich  answer  or  statement  is 
incorrect  it  is  a  false  warranty  and  vitiates  the  contract,  regardless 
of  whether  the  applicant  honestly  believed  it  to  be  true. 

Schofield  vs.   Metropolitan  Life  Ins.  Co.,  Oct.,   1906,  79  Vt.  161. 


960  FRATERNAL    SOCIETY   LAW 

"lUness"— Defined. 

The  word  "illness,"  as  used  in  questions  to  au  applicant  for  life 
insurance,  means  a  disease  or  ailment  of  such  character  as  to  seri- 
ously affect  the  healthfulness  of  the  system,  and  not  a  mere  tempo- 
rary indisposition. 

Schofleld  vs.   Metropolitan  Life  Ins.  Co.,   Oct.,   1906,  79  Vt.   161. 

Seal,  Society  May  Adopt,  Presumptions  with  Respect  to  Same. 

A  fraternal  society  may  use  and  adopt  any  seal  that  it  chooses, 
and  when  a  document  is  signed  by  the  proper  officials  of  the  society 
and  bears  an  impress  of  a  seal  with  the  name  of  the  society  in  the 
impress,  in  the  absence  of  evidence  to  the  contrary,  it  will  be  pre- 
sumed that  the  seal  is  the  proper  and  common  seal  of  the  society. 

Morrill  vs.  Cath.  Order  of  Foresters,  Jan.,  1907,  79  Vt.  479. 

Suit  by  Administrator  on  Certificate,  When  Proper. 

The  Catholic  Order  of  Foresters  issued  a  certificate  to  a  member 
payable  to  the  two  sons  of  the  member  by  name.  After  the  member's 
death,  suit  was  brought  on  the  certificate  in  question  by  the  ad- 
ministrator of  the  deceased  member's  estate.  In  view  of  the  fact 
that  the  certificate  was  sealed  with  the  corporate  seal,  which  under 
the  statute  made  it  a  .specialty,  the  court  held  that  the  suit  was 
properly  brought  in  the  name  of  the  administrator. 

Morrill  vs.  Cath.  Order  of  Foresters,  Jan.,  1907,  79  Vt.  479, 

Contract,  Construction  of. 

In  the  construction  of  contracts,  the  circumstances  in  which  the 
parties  contract  are  proper  to  be  looked  at,  and  the  common  knowl- 
edge of  the  parties  may  be  a  circumstance  and  afl^ect  the  proper 
construction  of  the  contract. 

Trow  vs.  Preferred  Accident  Ins.  Co.,  Supreme  Ct.  Vt.,  October,  1907, 
67  Atl.  821. 


THE    STATU    OF    YIKGJNIA  (jQi 


THE 

STATE  OF  VIRGINIA. 

CHAPTER  47. 

(The  Section  numbers  employed  eorrespoud  to  those  in   the  act 
approved  March  9,  1906.) 

Definition — Powers — Funds — ^Designation   of   Beneficiaxies   Exemp- 
tions. 

Section  1.  A  fraternal  beneficiary  association,  order  or  society  is 
herebj^  declared  to  be  a  corporation,  society,  order  or  voluntary  as- 
sociation which  is  formed  or  organized  for  the  purpose  of  providing 
benefits,  charity,  relief  or  insurance  for  its  members  and  their  bene- 
ficiaries, such  insurance  being  issued  in  the  form  of  certificates  of 
membership  therein  which  provide  for  the  payment  of  a  specified  or 
other  sum  of  money  to  the  beneficiary  on  the  death  of  the  member 
in  consideration  of  the  payment  by  the  member  of  fixed  sums  at 
fixed  periods,  or  of  any  sums  in  the  form  of  dues  or  other  assessments 
as  may  be  i^rovided  in  its  constitution  and  by-laws;  provided,  such 
corporation,  society,  or  voluntary  association  shall  have  no  capital 
stock,  and  has  a  representative  form  of  government  and  a  lodge  sys- 
tem, with  ritualistic  form  of  work  for  the  meeting  of  its  lodges,  chap- 
ters, councils,  or  other  designated  subordinate  bodies,  and  the  bene- 
fits, charity,  relief  and  insurance  shall  be  payable  by  a  grand  or 
supreme  body  of  the  same  excepting  sick  benefits,  which  may  be  paid 
also  by  local  or  subordinate  bodies  of  such  order ;  and  provided,  fur- 
ther, that  every  such  association  may  provide  in  its  constitiition  or 
by-laws  that  if  such  regular  payments  are  insufficient  to  pay  all  ma- 
61 


962  FRATERNAL    SOCIETY    LAW 

tured  death  and  disability  claims  in  full  and  to  provide  for  the  crea- 
tion and  maintenance  of  the  funds  required  by  its  constitution  and 
by-laws,  extra  assessments  or  other  payments  may  be  levied  upon  the 
members;  provided,  further,  that  orders  or  societies  operating  upon 
the  plan  of  levying  and  collecting  post-mortem  assessments  shall  in- 
dicate this  i:irovision  on  the  face  of  the  certificate.  Such  grand  or 
supreme  bodies  may  be  composed  of  its  officers,  incorporators,  rep- 
resentatives elected  by  local,  district  or  grand  bodies,  past  officers 
and  standing  committees.  Such  orders  or  associations  may  make 
a  constitution  and  by-laws,  alter  and  amend  the  same  from  time  to 
time,  and  adopt  such  other  rules  and  regulations  consistent  -wath 
the  existing  laws  of  the  State,  for  the  government  of  all  under  its 
authority,  for  the  management  of  its  properties  and  the  due  and 
orderly  conduct  of  its  affairs.  Said  constitution  and  by-laws  when 
so  made,  or  as  changed,  altered  or  amended,  shall  be  the  law  govern- 
ing the  said  association  and  its  officers,  and  subordinate  branches 
or  lodges,  and  all  members  and  beneficiaries  in  their  beneficial,  finan- 
cial and  social  relations  to  such  association.  Except  as  provided 
in  Section  11  of  this  act,  no  such  association  or  order  shall  admit 
to  beneficial  membership  any  person  less  than  sixteen  nor  more  than 
sixty  years  of  age.  Such  orders  or  associations  shall  make  provision 
for  the  payment  of  benefits  in  ease  of  death,  and  may  make  pro- 
vision for  the  payment  of  benefits  in  case  of  sicl^ness,  and  temporary 
or  permanent  physical  disability,  either  as  a  result  of  disease,  acci- 
dent or  old  age ;  provided,  the  period  of  life  at  which  the  payment 
for  old  age  commences  shall  not  be  lander  seventy  years.  Any  such 
order  or  association  may  also  accumulate,  maintain,  apply  and  dis- 
burse among  its  membership,  or  their  beneficiaries,  a  reserve  or  sur- 
plus fund  as  may  be  provided  in  its  constitution  and  laws. 

The  funds  from  which  the  payment  of  benefits  shall  be  made  and 
the  fund  from  which  the  expenses  shall  be  defrayed,  shall  be  derived 
from  assessments,  dues  or  other  payments  collected  from  its  mem- 
bers, as  may  be  provided  by  the  constitution  or  by-laws  of  such 
order  or  association.  Payment  of  death  benefits  shall  be  to  families, 
heirs,  blood  relatives,  affianced  husband  or  affianced  wife  of,  or  to 
persons  dependent  upon  tlie  member,  as  may  be  designated  by  the 
member,  or  to  such  other  beneficiaries  as  may  be  pcnnitted  by  the 


THE    STATE    OF    VIRGINIA  963 

laws  of  the  State  or  province  in  which  such  other  or  association  is 
chartered. 

Each  member  shall  have  the  right  to  designate  his  beneficiary,  and 
from  time  to  time  have  the  same  changed  in  accordance  with  the  by- 
laws, rules  or  regulations  of  the  order  or  associations  and  no  bene- 
ficiary shall  have  any  vested  interest  in  the  said  benefit  until  the 
same  has  become  due  and  payable  upon  the  death  of  tlic  member. 

All  such  fraternal  beneficiary  orders,  associations  or  societies  shall 
be  subject  to  the  supervision  and  direction  of  the  bureau  of  insur- 
ance, within  the  department  and  s\ibject  to  the  supervision  and  con- 
trol of  the  State  corporation  commission,  as  provided  by  law,  iind  all 
such  fratei"nal  orders,  associations  or  societies  shall  be  governed 
by  this  chapter,  and  shall  be  exempt  from  the  provisions  of  section 
twelve  hundred  and  seventy-one  of  the  Code,  relating  to  securities 
to  be  deposited  with  the  treasurer  of  this  State,  and  shall  be  exempt 
from  all  other  laws  of  this  State  relating  to  corporations  organized 
and  doing  business  imder  the  system  of  life  or  casualty  insurance 
known  as  either  the  old  line  or  legal  reserve  plan  or  the  co-operative 
or  assessment  plan :  Provided,  however,  that  nothing  in  this  section 
shall  be  construed  to  exempt  such  orders,  associations  or  societies 
fi'om  the  operation  of  any  laws  governing  pleading  and  evidence, 
the  jurisdiction  of  courts  and  the  limitations  of  actions,  in  suits  or 
actions  on  insurance  policies  or  certificates. 

Condition  on  Which  Orders  May  Continue  Operation  in  the  State. 

.  Section  2.  Any  fraternal  beneficiary  order,  association  or  society 
of  this,  or  any  other  State,  district,  province  or  Territoi-y,  now  hav- 
ing members,  or  any  lodge,  chapter,  council,  or  subordinate  branch 
duly  established  and  organized  in  this  State,  may  continue  its  opera- 
tions and  business  in  this  State :  Provided,  that  it  hereafter  com- 
plies with  the  provisions  of  this  act,  and  provided  it  is  solvent. 

Conditions  on  Which  Orders  May  Begin  Operation  in  the  State. 

Section  3.  Any  fraternal  beneficiary  order,  association  or  society 
coming  within  the  description  as  set  forth  in  section  one  of  this  act, 
•organized  under  the  laws  of  any  other  State,  province,  district  or 


964  FRATERNAL    SOCIETY    LAW 

territory,  not  now  having  lodges,  councils  or  other  subordinate 
bodies,  or  members  in  this  State,  shall  be  permitted  to  do  business 
within  this  State  in  accordance  with  this  chapter  when  it  shall  have 
filed  with  the  commissioner  of  insurance  a  certificate  from  the  official 
in  charge  of  insurance  matters  in  its  home  State  of  incorporation 
that  it  is  authorized  to  transact  business  therein  as  a  fraternal  bene- 
ficiary order,  society  or  association,  also  a  duly  certified  copy  of  its 
charter  and  articles  of  association,  and  a  copy  of  its  constitution 
and  laws,  certified  to  by  its  secretary  or  corresponding  officer,  to- 
gether with  an  appointment  of  the  commissioner  of  insurance  as  the 
person  upon  whom  legal  process  may  be  served,  as  hereinafter  pro- 
vided ;  and  provided,  such  order,  association  or  society  is  solvent. 

Annual  Reports. 

Section  4.  Each  such  corporation,  society,  order  or  association 
doing  business  in  this  State,  shall,  on  or  before  the  first  day  of 
March  of  each  year,  make  and  file  with  the  State  corporation  com- 
mission a  report  of  its  afi'airs  and  operations  during  the  year  ending 
the  thirty-first  day  of  December  immediately  preceding.  Such  re- 
port shall  be  made  on  blanks  provided  by  the  State  corporation 
commission,  imder  oath  by  the  duly  authorized  officers  of  any  such 
order  or  association,  and  shall  be  published  or  the  substance  there- 
of, in  the  annual  report  of  the  commissioner  of  insurance,  and  shall 
be  in  the  following  form: 

Annual  Statement. 

For  the  year  ending  December  31.  19 . 


Of  the  condition  and  affairs  of  the ,  organized 

under  the  laws  of  the  State  of ,  made  to  the  auditor  of 

public  accounts  of  • — — — ,  president,  or  corresponding  title  • , 

first  vice-president,  or  corresponding  title secretary,  or  corre- 
sponding title  ,  treasurer  or  corresponding  title   (state  what 

law),   .     Incorporated   ,   nineteen    hundred   and  , 

under  •,  approved  ,  nineteen  hundred  and  ,  chap- 
ter  ;  organized ,  nineteen  hundred  and ;  voluntary 

association  ;  commenced  business,  190 ;  home  office  (give 

street  and  number).  


THE    STATE    OF    VIRGINIA  955 

One.    Balance  Sheet. 

Amount  of  net  ledger  assets,  Dccenihoi-  tliirty-on(%  ciT  prcvidiis 
year,  $ . 

Two.    Income  during  the  year. 

As  shown  by  the  books  at  the  home  office  at  close  of  business 

December  thirty-one,  nineteen  hundred  and  .     Gross  amount 

I^aid  by  members  to  the  society  as  follows : 

One.  Dues  for  expenses,  per  capita  tax,  etc.,  $ . 

Two.  Assessments :  Mortuary,  $ ;  reserve  $ ;  ex- 
penses, $ . 

Three.    Total  received  from  members,  $ — . 

Four.    Interest,  $ ;  rent,  $ . 

Five.   From  all  other  sources — viz. : 


Total  income  during  the  year $- 

Sum  of  both  amounts $- 


Three.    Disbursements  during  the  year. 

As  shown  by  the  books  at  home  office  at  close  of  business. 

December  31,  1901 . 

One.    Death   claims,    $ ;  penuanent  disability   claims, 

$ $ 

Two.   Temporary  disability,  $ ;  old  age  benefits,  $ $ 

Three.    Payments  returned  to  applicants  or  members.... $ 

Total  paid  to  members  and  beneficiaries $ 

Four.  Commissions,  fees,  salaries  paid  or  allowed  to  agents 
for  organization  of  subordinate  bodies  and  ujibuilding  of 

same    $ 

Five.   Salaries  paid  to  officers $ 

Six.    Salaries  paid  to  office  employes $ 


966  FRATERNAL    SOCIETY    LAW 

Seven.  Salaries  or  fees  paid  supreme  or  medical  super- 
visors     $- 

Eight.  Rent,  $ ;  taxes,  $ ;  advertising,  official  pub- 
lication and  printing,  $ .$- 

Nine.  Postage,  express  and  telegraph,  $ ;  legal  ex- 
penses, $ ;  governing  bodies.  $ ;  insurance  de- 
partments, $ ;  miscellaneous,  $ $- 

Ten.  All  other  items,  viz. : 


(Total  expenses,  footings  of  items  four  to  ten,  $ ).  Total 

disbursements    $- 

Balance $ 

Invested  as  follows : 

Four.  Ledger  assets. 

As  shown  bj'  the  books  at  home  office  at  close  of  business. 

December  31,  190—. 

One.  Book  value  of  real  estate,  unencumbered,  $ ;  en- 
cumbered, $ $ 

Two.    Mortgage  loans  on   real  estate,  first  liens,  $ ; 

other  than  first,  $ $ 

Three.  Loans  secured  by  pledge  of  bonds,  stock,  or  other 
collateral    $ 

Four.  Book  value  of  lionds  (excluding  interest)  and  stocks 
owned  absolutely   $ 

Five.  Personal  agents'  debit  balances,  $ •  bii^  receiv- 
able, $ •  $ 

Six.   Cash  in  office,  $ ;  deposited  in  bank  (name  banks 

and  amounts) ,  $ $ 


THE    STATE    OF    VIRGINIA  967 


Seven.    Total    $- 

Deduct  ledger  liabilities. 

Bight.    Personal  or  agents'   credit  balances  % ;  bor- 
rowed money,  $ ;  all  other,  $ $- 

Nine.   Total  net  ledger  assets  as  per  balance  on  page , 

compi'ised  under  the  following  funds $- 

Ten.    Mortuary   $- 

Eleven.    Reserve   $- 

Twelve.    Emergency    $- 

Thirteen.    Expense    $- 


Five.    Non-ledger  assets. 

Fourteen.  Interest  due,  $ ;  accrued,  $ ;  on  mort- 
gages, $ $- 

Fifteen.    Interest    due,   $ ;   accrued.   .$ ;    on   other 

assets,   .$ $- 

Sixteen.    Rents  due,  $ ;   accrued,  $ ;  on  property 

or  lease.  $ $- 

Seventeen.   Market  value  of  real  estate  over  book  value.  .  .$- 

Eighteen.  Market  value  of  bonds  (not  including  interest) 
and  stocks  over  book  value $- 

Nineteen.  Assessments  due  on  last  call,  made  within  sixty 
days,  on  certificates  in  force $- 

Twenty.  Assessments  to  become  due  on  certificates  not  ex- 
ceeding one  assessment,  nor  the  amount  of  chiims  not 
assessed  for  per  item  two  of  liabilities $- 

Twenty-one.    Other  items   $- 

Total  non-ledger  assets    $- 

Gross  assets  $- 

(Deduct  assets  not  admitted.) 

One.  Furniture,  fixtures  and  safes,  supplies,  printed  mat- 
ter, stationery,  etc $- 

Two.  Personal  or  agents'  debts  debit  balances  unsecured. 
$ ;  bills  receivable  unsecured,  $ $- 


968  FRATERNAL    SOCIETY    LAT/f 

Three.  Excess  of  items  seventeen  and  eighteen  over 
charges  in  liabilities  on  same  account $- 

Four.  Depreciation  of  ledger  assets  to  bring  same  to  mar- 
ket value    $- 

Real  estate,  $ ;  bonds  and  stocks,  $ .$- 

Five.   Other  items: 


$ 

Total  non-admitted  assets $ 

Total  admitted  assets $ 

Six.    Non-ledger  liabilities. 

One.  Losses  on  certificates  due  and  unpaid,  $ ;  ad- 
justed, not  due,  $ $ 

Two.   Instalment  of  annuity  benefits  not  due $ 

Three.  Losses  on  certificates  not  adjusted,  $ ;  re- 
sisted, $ $— 

Four.    Salaries,  rents,  expenses,  taxes,  bills,  accounts,  fees 

etc.,  due  and  accrued $ 

Five.     Advanced   assessments $ 

All  other  liabilities — viz. : 

$ 

Total  liabilities   $ ■ 

Balance  to  protect  contracts $ 

'I 
Seven.   Exhibit  of  certificates. 

Total  business  during  year.     Business  in  Virginia  during  year. 

Number,  ;  amount, ;  number,  ;  amount, . 

Certificates  in  force  December  thirty-one  (beginning  of  year, 

Certificates  in  force  December  thirty-one,  beginning  of  j'ear, 


THE    STATE    OF    VIRGINIA  909 

Death  losses  and  claims. 

No.  Amount.  No.     Amount. 

Losses  and  claims  unpaid   December 

thirty-one    (beginning  of  year)... $ $ 

Losses   and   claims    incurred   during 

the  calendar  year    $ $ 

Total    $ $ . 

Losses   and    claims    paid    during    the 

year $ $ • 

Losses   and    claims   unpaid    (Decem- 
ber thirty-one,  end  of  year) $ $ 

Disability  losses  and  claims. 

Losses  and  claims  unpaid  December 

thirty-one   (beginning  of  year)... $ $ 

Losses   and   claims   incurred    during 

the  calendar  year — ■ —    $ $ 

Total    $ $ 

Losses   and   claims  paid   during  the 

year     $ $ 

Losses    and    claims    unpaid    Decem- 
ber thirty-one   (end  of  year) $ $ 

State  of ,  county  of ss  -. 

■,  president    (or  chief  executive  officer),   and , 

secretary   (or  similar  officer),  of  the  society,  being  duly 

sworn,  each  for  himself  deposes  and  says,  that  they  are  the  above 
described  officers  of  the  said  society,  and  that  on  the  thirty-first  day 
of  December  last  all  the  above-described  assets  were  the  absolute 
property  of  the  said  society  free  and  clear  from  any  liens  or  claims 
thereon,  except  as  above  stated;  and  that  the  foregoing  statement 
of  the  assets,  liabilities,  income  and  disbursements,  and  of  the  con- 
dition and  affairs  of  the  said  society  on  the  said  thirty-first  day  of 
December  last,  and  for  the  year  ending  on  that  date,  according  to 
the  best  of  their  information,  knowledge  and  belief,  respectively, 
are  true  and  correct. 


970  FRATERNAL    SOCIETY    LAW 

Subscribed  and  sworn  to  before  me  this day  of 

A.  D.  19 . 


Examinatfon  of  Books  by  Commissioner — Certificates  of  Result. 

Section  5.  The  commissioner  of  insurance,  or  any  person  or  per- 
sons appointed  by  him.  shall,  at  the  request  of  any  fraternal  bene- 
ficiary order  or  association,  or  he  may  of  his  own  volition,  examine  the 
books,  accounts  and  assets  of  any  fraternal  beneficiary  association, 
order  or  society  operating  in  this  State  for  the  piarpose  of  verifying 
the  annual  report  submitted,  and  all  expenses  incident  thereto,  as 
may  be  deemed  reasonable  by  the  auditor  of  public  accounts,  shall 
be  paid  by  such  association,  order  or  society:  Provided,  however, 
that  in  ease  of  fraternal  beneficiary  associations,  orders  or  societies 
organized  under  the  laws  of  another  State,  the  commissioner  of 
insurance  may  accept  in  lieu  of  such  examination,  the  examination 
■  of  the  insurance  official  of  said  State.  Territory  or  province,  under 
the  laws  of  which  such  association,  order  or  society  is  organized  and 
in  which  it  has  its  home  office.  In  the  event  of  examination,  the 
commissioner  of  insurance  shall  furnish  to  such  association,  order 
or  society  a  certificate  as  to  the  result  of  his  examination,  and  he 
shall  furnish  to  domestic  fraternal  associations,  orders  or  societies 
such  certificates  as  may  be  required  by  the  insurance  officials  of 
other  States  in  relation  to  their  business  with  fraternal  beneficiaiy 
associations  or  orders  chartered  under  the  laws  of  this  State. 

Foreign  Orders  to  Appoint  Commissioner  to  Accept  Service  of  Pro- 
cess— Duty  of  Commissioner — Fees. 

Section  6.  Bach  such  corporation,  society,  or  association  now  do- 
ing, or  hereafter  admitted  to  do  business  within  this  State,  and  not 
having  its  principal  office  within  this  State,  and  not  being  organized 
under  the  laws  of  this  State,  shall  appoint,  in  writing,  the  insur- 
ance commissioner,  and  his  successors  in  office,  to  be  its  true  and  law- 
ful attorney,  ujion  wlioni  all  lawful  process  in  any  action  or  pro- 
ceeding against  it  mav  be  served,  and  in  such  writing  shall  agree 


THE    HTATE    OF    VlJiOJNlA  971 

that  any  lawful  process  against  it,  which  is  served  on  said  attorney, 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
order  or  association,  and  that  the  authority  shall  continue  in  force 
so  long  as  any  liability  remains  outstanding-  in  this  State  and  such 
service  in  this  State  shall  alone  l)e  a  legal  service.  Copies  of  such 
appointment,  certified  by  said  commissioner  of  insurance,  shall  be 
deemed  sufficient  evidence  thereof,  and  shall  be  admitted  in  evidence 
with  the  same  force  and  effect  as  the  original  thereof  might  be  ad- 
mitted. Service  upon  such  attorney  shall  be  deemed  sufficient 
service  upon  such  association.  When  legal  process  against  any  such 
order  is  served  upon  the  said  commissioner  of  insurance,  he  shall 
immediately  notify  the  order  of  such  service  by  letter,  prepaid  and 
directed  to  its  secretary  or  corresponding  officer,  and  he  shall,  within 
two  days  after  such  service,  forwai'd  in  the  same  manner  a  eo])y  of  the 
process  served  on  him  to  such  officer.  The  plaintitt'  in  su('li  process 
shall  pay  to  the  commissioner  of  insurance,  at  the  time  of  such 
service,  a  fee  of  two  dollars  and  fifty  cents,  which  shall  be  recov- 
ered by  him  as  a  part  of  the  taxable  costs,  if  he  finally  prevail  in  the 
suit.  The  commissioner  of  insurance  shall  keep  a  record  of  all  pro- 
cesses served  upon  him,  which  record  .shall  show  the  day  and  hour 
when  such  service  was  made  and  by  whom  made. 

License  to  do  Business — Annual  Fees. 

Section  7.  The  commissioner  of  iu.surance  shall,  upon  the  appli- 
cation of  any  order,  society  or  association  having  the  right  to  do 
business  in  this  State,  as  provided  by  this  act,  issue  a  permit  in 
writing,  authorizing  it  to  do  business  in  this  State,  for  which  certifi- 
cate and  all  proceedings  in  connection  therewith  such  order  or 
association  shall  pay  to  the  said  commissioner  of  insurance  a  fee 
of  twenty  dollars,  which  shall  be  in  lieu  of  all  fees  and  license  taxes, 
whether  State,  county  or  municipal.  This  fee  shall  be  paid  annually 
thereafter  in  advance. 

Procedure  Upon  Failure  to  Obey  Law — When  Unlawful  to  Solicit 
New  Members — Penalties. 

Section  8.     It  shall  be  unlawful  for  auv  such  order,  association  or 


972  FRATERNAL    SOCIETY    LAW 

society  to  do  business  iu  this  State  while  it  is  in  default  in  making 
said  report  to  the  State  corporation  commission.  The  insurance 
commissioner  shall,  within  sixty  days  after  failure  to  make  such 
report,  and  shall,  in  case  any  such  order,  association  or  society  con- 
duct its  business  fraiidulently,  or  in  aiiy  manner  fail  to  comply  with 
this  act,  give  notice  of  the  same,  iu  writing,  to  the  attorney-general, 
who  shall  immediately  notify  such  order,  association  or  society  of 
such  complaint  and  afford  it  reasonable  opportunity  on  a  day 
named  in  such  notice  to  show  cause  why  proceedings  to  exclude  it 
from  doing  business  in  this  State  should  not  be  instituted.  If,  upon 
such  hearing  before  him,  the  attorney-general  lie  of  the  opinion 
that  such  proceedings  should  be  instituted,  he  shall  forthwith  insti- 
tute the  same.  And  if  the  court,  upon  hearing,  shall  be  of  the  opin- 
ion that  such  order,  association  or  society  has  violated  the  provisions ' 
of  this  chapter,  or  has  conducted  its  business  fraudulently,  the  court 
shall  enjoin  it  from  doing  business  in  this  State  or  make  any  other 
order  which  the  court  may  deem  proper  in  the  premises. 

Any  officer,  agent  or  person  attempting  to  secure  new  members 
for  an.y  order,- association  or  society  which  has  been  excluded  from 
doing  business  in  this  State,  shall  be  deemed  guilty  of  a  misde- 
meanor, and  upon  conviction  thereof  shall  be  pimished  by  a  fine  of 
not  less  than  one  hundred  dollars;  and  each  act  in  violation  of  this 
provision  shall  be  constituted  a  separate  offense. 

When  Unlawful  to  Solicit  Members. 

Section  9.  Any  person  who  shall  act  within  this  State  as  an  of- 
ficer, agent  or  otherwise,  for  any  such  fraternal  beneficiary  order  or 
association  in  soliciting  members,  which  shall  have  neglected  or 
refused  to  comply  with  this  act,  shall  be  subject  to  the  penalty 
provided  in  the  last  preceding  section  for  the  misdemeanor  therein 
specified. 

Transfer  of  Membership  and  Assets  From  One  Order  to  Another. 

Section  10.  No  domestic  fraternal  beneficiarj^  association,  order 
or  society  shall  transfer  its  membership  and  assets  to  any  association, 
order  or  society  or  insurance  corporation  not  licensed  to  do  business 


THE    STATE    OF    VIRGINIA  973 

in  this  State;  nor  shall  such  transfer  be  made  to  any  licensed  society, 
order,  association  or  corporation  unless  the  agreement  to  so  transfer 
has  l)('en  approved  by  a  two-thirds  vote  of  the  members  of  the  su- 
preme body,  or  any  other  body  competent  to  act  during  recess  of 
the  supreme  body  of  such  association,  order  or  society  whose 
membership  is  proposed  to  be  transferred;  and  by  a  two-thirds  vote 
of  the  supreme  body  or  any  other  body  competent  to  act  during 
recess  of  supreme  body  of  such  order,  association  or  society  pro- 
posing to  accept  such  membership  and  assets.  Any  domestic  fra- 
ternal benehciary  association,  order  or  society  may  accept  the  mem- 
bership and  assets  of  any  other  such  organization  upon  such  terms 
and  conditions  as  may  be  agreed  upon  by  said  governing  body  or 
bodies  authorized  to  act  under  the  constitution  and  laws  of  such 
order,  association  or  society. 

Penalty  for  Fraudulently  Procuring  Certificate — Such  Certificate 
Void. 

Section  11.  Any  agent,  physician  or  other  person  who  shall 
knowingly  secure  or  cause  to  be  secured  a  certificate  of  membership 
on  any  person  without  his  knowledge  or  consent,  or  by  means  of 
misrepresentation,  false,  fraudulent  or  untrue  statements  be  instru- 
mental in  securing  a  certificate  of  membership  on  any  aged  or  infirm 
person,  or  in  restoring  to  membership  any  person  not  in  an  insur- 
able condition,  shall  be  deemed  guilty  of  a  misdemeanor,  and  upon 
conviction  thereof  shall  be  fined  in  a  sum  not  less  than  one  hun- 
dred dollars,  nor  more  than  one  thousand  dollars,  or  to  be  imprisoned 
in  jail  not  less  than  thirty  days  nor  more  than  one  year,  or  both, 
and  the  said  certificate  or  renewal  so  secured  shall  be  absolutely 
void. 

Act  Not  Applicable  to  Certain  Orders. 

Section  12.  And  nothing  in  this  act  shall  be  held  to  affect  or  to 
apply  to  grand  or  subordinate  lodges  of  masons,  knights  of  Pythias 
(endowment  rank  excepted),  odd  fellows,  red  men,  junior  order  of 
American  mechanics,  or  similar  orders  that  do  not  inspire  the  lives 
of  their  members. 


V 


974  FRATERNAL    SOCIETY    LAW 

Forfeiture — No  Waiver  of  Laws  by  Custom  of  Local  Lodge  Officers' 
Acts. 

The  forfeiture  of  a  certificate  is  not  waived  by  the  fact  that  the 
subordinate  lodge  collector  is  in  the  habit  of  receiving  payments  of 
assessments  after  the  end  of  the  month  for  which  they  are  levied 
and  within  which  they  are  payable  under  the  penalty  of  suspension 
and  forfeiture,  where  there  is  no  evidence  that  the  supreme  lodge 
which  is  sued  on  the  certificate  is  aware  of  such  habit  or  custom. 

Supreme  Lodge,  Knights  of  Honor  vs.  Oeters,  Feb.,  1S98,  95  Va.  610. 

Forfeiture — Waivers  of  Laws,  Estoppel. 

Where  the  arrears  for  Avhich  a  member  stands  suspended  and  his 
certificate  forfeited  have  not  been  paid  at  the  time  of  his  death,  no 
waiver  of  the  forfeiture  can  be  implied  from  the  fact  that  the  local 
collector  had  previously  been  in  the  habit  of  receiving  payments  of 
such  arrears  after  the  dates  at  which  they  were  payable. 

Supreme  Lodge,  Knights  of  Honor  vs.  Oeters,  Feb.,  189S,  95  Va.  610. 

Warranties,  Literal  Truth  Required  Under. 

The  statements  contained  in  an  application,  which  are  made  in 
answer  to  specific  questions,  where  the  application  contains  general 
terms  pf  wai-ranty  as  to  the  truthfulness  of  the  statements,  are  to  be 
deemed  warranties,  and  if  untrue,  thi^  contract  is  void. 

Metropolitan  Life  Ins.  Co.  vs.  Rutherford,  April.  1,S9S,  95  Va.  773. 

Contract — Repudiation  of — Right  to  Sue. 

Where  there  has  been  a  total  refusal  by  one  of  the  parties  to  per- 
form his  part  of  the  contract,  the  other  may  elect  to  sue  at  once  for 
the  breach  without  waiting  for  the  time  of  performance  to  arrive, 
but  to  justify  such  suit  there  must  be  a  distinct,  unequivocal,  and 
absolute  refusal  to  perform  the  contract.  Notice  by  an  assessment 
comi^any  that  if  certain  increased  assessments  are  not  paid  in  a 


THE    STATE    OF    VllHllNlA  975 

given  time,  it  will  declare  the  contract  void,  is  a  conditional  repudia- 
tion, and  no  action  will  lie  for  the  breach  of  the  contract  until  the 
company  declares  the  contract  void. 

Lee  vs.  Mut.  Reserve  Fund  Assn.,  June,  1899,  97  Va.  160. 

Warranty,  False  Answers  Under. 

In  an  application  for  insurance  where  the  applicant  fails  to  dis- 
close that  he  has  made  application  and  has  been  rejected  for  insur- 
ance in  other  compauie.s,  when  such  matters  are  inquired  into  under 
a  general  statement  of  warranty  as  to  the  truthfulness  of  the  answei's 
given,  where  it  is  found  that  such  application  is  false  in  that  the 
applicant  concealed  that  he  had  made  application  and  been  rejected, 
the  certificate  issued  upon  the  same  is  void. 

National  Life  Assn.  vs.  Hoplvins,  June,  1899,  97  Va.  167. 

Warranties  Strictly  Upheld. 

If  a  contract  makes  the  statements  in  the  aiDplication  warranties, 
and  such  application  states  that  the  death  of  the  father  of  the 
member  was  caused  by  one  disease,  and  the  proof  of  loss  made  by 
the  beneficiary  and  offered  in  evidence  by  him  states  that  said  death 
was  caused  by  a  different  disease,  on  a  demurrer  to  the  evidence  of 
the  beneficiary  in  an  action  on  the  contract,  judgment  should  be 
given  for  the  society. 

Metropolitan  Life  Ins.  Co.  vs.  Rutherford,  Marcli,  1900,  98  Va.  195. 

Warranties,  Literal  Truth  of  Answers  Required  Under. 

Where  the  answers  to  questions  propounded  in  an  application  for 
insurance  are  made  warranties  by  the  terms  of  the  contract,  its 
validity  depends  upon  the  literal  truth  of  such  answers,  and  it  is  a 
matter  of  no  consequence  whether  or  not  they  are  material  to  the 
risk.  Being  warranties  they  are  in  the  nature  of  conditions  pre- 
cedent, and  like  them  must  be  strictly  complied  with. 

Metropolitan  Lite  Ins.  Co.  vs.  Rutherford.  March,  1900,  98  Va.  195. 


976  FRATERNAL    SOCIETY    LAW 

Contract — Repudiation  of — Suit  on. 

When  one  party  to  a  contract  has  entirely  abandoned  it,  or  has 
absolutely  refused  to  perform,  the  other  party  may  sue  on  it  at  once 
without  waiting  for  the  time  of  performance  to  arrive. 

Mutual  Reserve  Fund  Life  Assn.  vs.  Taylor,  Feb.,  1901,  99  Va.  208. 

Assessments,  Increase  of  as  Required. 

A  stipulation  in  a  mutual  life  insurance  contract  that  the  rate  of 
assessments  may  be  changed  to  correspond  with  the  actual  mortality 
experience  of  the  society,  means  that  the  proportion  between  differ- 
ent ages  may  be  changed  to  meet  the  result  of  experience,  and  not 
merely  that  all  rates  must  be  increased  the  same  percentage. 

Mutual  Reserve  Fund  Life  Assn.  vs.  Taylor,  Feb.,  1901,  99  Va.  208. 

Foreign  Society,  Rights  of. 

A  state  may  exclude  altogether  a  foreign  corporation  from  doing 
business  within  its  limits,  or  exact  such  security  for  the  performance 
of  its  contracts  with  its  citizens  as  it  may  deem  proper,  Avhere  such 
foreign  corporation  is  not  in  the  employ  of  the  federal  government, 
nor  engaged  in  interstate  or  foreign  commerce. 

National  Council  vs.  State  Council,  June.  1905,  104  Va.  197. 

Evidence,  Parol  Agreements  Respecting  Insurance  Contracts. 

In  an  action  to  recover  on  a  life  insurance  eoutract,  a  contempo- 
raneous parol  agreement  or  understanding  between  the  agent  who 
solicits  the  insurance  and  the  member  as  to  the  time  and  place  of 
paying  premiums  different  from  that  stated  in  the  contract,  cannot 
be  given  in  evidence,  as  it  varies  or  contradicts  the  terms  of  the 
written  contract  of  the  parties. 

Metropolitan  Life  Ins.  Co.  vs.  Hall,  November,  1905,  104  Va.  572. 


I 


THE   STATE    OF    VIRGINIA  ■        977 

Contract— What  is  Life  Insurance. 

A  contract  by  which  a  society  agrees  to  pay  a  certain  sum  of 
money  ou  the  death  of  a  member,  in  consideration  of  the  payment 
by  the  member  of  fixed  sums  at  fixed  periods,  by  whatever  name 
called,  is  a  life  insurance  policy  within  tlie  meaning  of  Section  3551 
of  the  Code  of  1904,  permitting  complaint  to  be  filed  instead  of  a 
declaration  in  a  formal  action  at  law,  and  is  not  a  mere  certificate 
of  membership  in  a  benefit  society  and  in  the  purview  of  the  acts 
of  1897. 

Cosmopolitan  Life'  Ins.  Co.  vs.  Koewl.  Nov.,  1905,  104  Va.  C19. 

Suicide — No  Presumption  of. 

The  defense  of  suicide,  to  avail,  must  exclude  every  hypothesis  of 
accidental  death,  and  the  party  making  the  defense  has  the  burden 
of  proof.  The  mere  fact  that  the  body  of  insured  is  found  with  a 
pistol  in  his  hand  and  a  bullet  wound  in  his  head  is  not  sufficient  to 
prove  suicide. 

Cosmopolitan  Life  Ins.  Co.  vs.  Koegel,  Nov.,  1905,  104  Va.  619. 

Evidence — Members  Presumed  to  Know  the  Laws  of  a  Society. 

Members  of  a  society  are  presumed  to  know  its  constitution  and 
by-laws,  and  after  they  have  been  approved,  if  a  member  claims 
there  has  been  a  change  in  them  affecting  his  rights,  the  burden  is 
upon  him  to  prove  it. 

United  Moderns  vs.  Rathbun,  Jan.,  1906,  104  Va.  736. 

Suicide— After-enacted  Laws  Valid. 

A  person  who  applies  for  and  receives  a  certificate  of  membership 
by  which  the  applicant  promises  and  agrees  to  be  bound  by  the  laws 
of  the  society  then  in  force  and  those  to  be  thereafter  adopted,  is 
bound  by  a  subsequent  law,  duly  passed,  which  provides  for  a 
forfeiture  of  said  certificate  or  a  lessening  of  the  value  thereof  in 


978  FRATERNAL    SOCIETY    LAW 

ease  the  member  shall  while  insane  commit  suicide,  although  no 
such  law  existed  when  the  certificate  was  issued. 

Plunkett  vs.  Supreme  Conclave,  Improved  Order  of  Heptasophs,  June, 

1906,  105  Va.   643. 

Contract,  Style  of  Type  Required  to  be  Printed  in. 

The  provisions  of  Section  3252  of  the  Code  requiring  the  condi- 
tions and  restricted  provisions  of  an  insurance  contract  to  be  printed 
in  type  as  large  as  or  larger  than  long  primer  type,  or  written  with 
pen  and  ink  in  or  upon  the  contract,  has  no  application  to  the  con- 
ditions or  restricted  provisions  contained  in  the  by-laws  of  an 
ordinary  benefit  society  which  is  made  a  part  of  the  certificate  of 
membership,  and  which  is  a  contract  between  the  society  and  the 
member. 

Fraternities  Accident  Order  vs.  Armstrong,  March,  1907,  106  Va.  746. 

Laws — Presumed  to  be  Known  to  Members. 

The  law  conclusively  presumes  that  those  who  become  members 
of  a  fraternal  society  have  acquainted  themselves  with  its  by-laws, 
and  they  are  bound  by  the  provisions  of  such  laws. 

Fraternities  Accident  Order  vs.  Armstrong,  March,  1907,  106  Va.  746. 

Venue  of  Suits  Against  Corporation. 

A  corporation  may  be  sued  on  a  transitory  cause  of  action 
wherever  it  is  doing  business  in  such  a  manner  or  to  such  an  ex- 
tent as  to  warrant  the  inference  that  it  is  there  present  through  its 
agents. 

Deatriclt  vs.  State  Life  Ins.  Co.,  Supreme  Ct.  App.  of  Va.,  November, 

1907,  59  S.  E.  489. 

Warranty — False  Statements. 

No  recovery  can  be  had  on  a  life  policy  issued  upon  wilfuUj'^ 


THE    HTATE    OF    VIRGINIA  979 

false  statements  of  the  assured,  of  facts  material  to  the  risk,  although 
the  insurance  was  solicited  by  tlic  agent  of  the  company,  and  the 
beneficiary  informed  the  agent  that  he  did  not  believe  the  insured 
could  obtain  insurance. 

Burruss  vs.  National  Life  Assn.,  Jan.,  1S99,  9G  Va.  543. 

Forfeiture — Where  Right  to  is  Waived. 

Where  the  right  to  rely  iipon  a  forfeiture  has  been  once  waived, 
it  is  extinguished  and  cannot  be  revived. 

Farmers  Benev.  Ins.  Assn.  vs.  Kinsey,  Feb.,  1903,  101  Va.  236. 

Payments  by  Husband  to  Keep  Certificate  on  Life  of  Wife  Alive. 

In  the  absence  of  contract,  payments  made  by  a  husband  on  a 
certificate  in  a  benefit  society  issued  to  the  wife  are  regarded  as 
gratuitous  and  create  no  equities  in  favor  of  the  husband. 

Leftwich  vs.  Wells,  Feb.,  1903,  101  Va.  255. 


980 


FRATERNAL    SOCIETY    LAW 


THE 


STATE  OF  WASHINGTON. 


\ 


CHAPTER  48. 

(The  Section  numbers  employed  correspond  to  those  in  the  insur- 
ance laws  of  Washington  compiled  1907.) 

Definition  of  and  Provisions  for — Ritualistic  System — Benefits. 

Section  117.  A  fraternal  beneficiary  association  is  hereby  de- 
clared to  be  a  corporation,  society  or  voluntary  association  formed 
or  organized  and  carried  on  for  the  sole  benefit  of  its  members  and 
their  beneficiaries,  and  not  for  profit.  Each  association  shall  have 
a  lodge  system  and  must  maintain  one  or  more  lodges  within  the 
State  Avith  ritualistic  form  of  work  and  representative  form  of  gov- 
ernment and  shall  make  provisions  for  the  payment  of  benefits  in 
case  of  death,  and  may  make  provisions  for  the  payment  of  benefits 
in  case  of  sicknes.s,  temporary  or  permanent  physical  disability, 
either  as  the  result  of  disease,  accident  or  old  age :  Provided,  The 
period  in  life  at  which  payment  of  physical  disability  benefits  on 
account  of  old  age  commences,  shall  not  be  under  seventy  (70)  years 
subject  to  their  compliance  with  its  constitution  and  laws.  The  fund 
from  which  the  payment  of  such  benefits  shall  be  made,  and  the 
fund  from  which  the  expenses  of  such  association  shall  be  defrayed, 
shall  be  derived  from  assessments  or  dues  collected  from  its  mem- 
bers. Payment  of  death  benefits  shall  be  to  the  families,  heirs, 
blood  relatives,  affianced  husband  or  affianced  wife  of,  or  to  persons 
dependent  upon  the  member.  Such  associations  shall  be  governed 
by  this  act  and  shall  be  exempt  from  the  provisions  of  other  laws 


THE    HTATE    OF    WASHINGTON  981 

of  this  State  and  no  law  hereafter  passed  sliall  apply  to  them  unless 
they  be  expressly  designated  therein.  Any  such  fraternal  beneficial 
association  may  create,  maintain,  disperse  [disburse]  and  apply  a 
reserve  or  emergency  fund  in  accordance  with  its  constitution  or  by- 
laws. 

Companies  Now  Doing  Business  Must  Comply. 

Section  118.  All  fraternal,  beneficiary  associations  organized  under 
the  laws  of  this  or  any  other  State,  province  or  Territory,  now 
doing  business  in  this  State,  may  continue  such  business :  Provided, 
That  they  hereafter  comply  with  the  provisions  of  this  act  regula- 
ting annual  reports  and  the  designation  of  the  Commissioner  of  In- 
surance as  the  person  whom  process  may  be  served  as  hereinafter 
provided. 

Foreign  Associations — How  Admitted. 

Section  119.  Anj'  such  association  coming  within  the  description, 
as  set  forth  in  Section  1  of  this  act,  organized  under  the  laws  of  any 
other  State,  province  or  territory,  and  not  now  doing  business  in 
this  State,  shall  be  admitted  to  do  business  within  this  State  when  it 
shall  have  filed  with  the  Commissioner  of  Insurance  a  duly  certified 
copy  of  its  charter  and  articles  of  association,  and  a  copy  of  its 
constitution  and  laws,  certified  to  by  its  secretary  or  corresponding 
officer,  together  with  an  appointment  of  the  Commissioner  of  Insur- 
ance of  this  State  as  a  person  upon  whom  ]n'oepss  may  be  served 
as  hereinafter  provided ;  and  provided  that  such  association  shall  be 
shown  to  be  authorized  to  do  business  in  the  State,  province  or  ter- 
ritory in  which  it  is  incorporated  or  organized,  in  case  the  laws  of 
such  State,  province  or  territory  shall  provide  for  such  authorization, 
and  in  case  the  laws  of  such  State,  province  or  territory  do  not  pro- 
vide for  any  formal  authorization  to  do  business  on  the  part  of  such 
association,  then  such  association  shall  be  shown  to  be  conducting 
its  business  in  accordance  with  the  provisions  of  this  act,  for  which 
purpose  the  Commissioner  of  Insurance  of  this  State  may  person- 
ally, or  by  some  person  to  be  designated  by  him,  examine  into  the 
condition,  affairs,  character  and  business  methods,  accounts,  books 


1 


982  FRATERNAL   SOCIETY   LAW 

and  investments  of  such  association  at  its  home  office,  which  exami- 
nation shall  be  at  the  expense  of  such  association,  and  shall  be  made 
within  thirty  days  after  demand  thereof,  and  the  expense  of  such 
examination  shall  be  limited  to  $200. 

Annual  Filing  of  Certificate  of  Authority. 

Section  120.  Any  association  doing  business  under  this  act  shall 
be  permitted  to  do  business  upon  filing  annually  with  the  Commis- 
sioner of  Insurance  of  this  State,  the  certificate  of  authorization 
of  the  insui'anee  department  of  the  State,  province  or  territory  in 
which  it  is  incorporated  or  organized :  Provided,  however,  In  case  of 
failure  to  file  said  certificate  by  any  such  association,  or  in  case  the 
Commissioner  of  Insurance  shall  deem  it  necessar.y,  he  shall  have 
power  to  examine,  either  personally  or  by  some  person  designated  by 
him,  into  the  condition,  affairs,  character,  business  methods,  ac- 
counts, books  and  investments  of  such  association,  at  his  home  office, 
which  examination  shall  be  at  the  expense  of  the  association ;  the 
amount  thereof  .shall  not  exceed  two  hundred  dollars  in  associations 
with  no  reserve  or  emergency  fund,  and  four  hundred  dollars  for 
associations  with  a  reserve  or  emergency  fund.  .( 


Report — Examination. 

Section  121.  Each  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and  file 
with  the  Commissioner  of  Insurance  of  this  State  a  report  of  its 
afi'airs  and  operations  during  the  year  ending  on  the  31st  day  of  De- 
cember, immediately  preceding,  which  annual  report  shall  be  in 
lieu  of  all  other  reports  required  by  any  other  law.  Such  reports 
shall  be  upon  blank  forms  to  be  provided  by  the  Commissioner  of 
Insurance,  or  may  be  printed  in  pamphlet  form,  and  shall  be  verified 
under  oath  by  the  dulj'  authorized  officers  of  such  association,  and 
may  be  published,  or  the  substance  thereof,  in  the  annual  report  of 
the  Commissioner  of  Insurance  under  a  separate  part  entitled  "Fra- 
ternal Beneficiary  Associations."  and  shall  contain  answers  to  the 
following  questions: 


1. 


THE    UTATE    OF    WA&UIXQTON  983 

1.  Number  of  certificates  issued  during  the  year,  or  members 
admitted. 

2.  Amount  of  indemnity  affected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representa- 
tives, or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted  and  state- 
ment of  reasons. 

9.  Does  the  association  charge  annual  or  other  periodical  dues 
or  admission  fees? 

10.  How  much  of  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be. 

11.  Total  amount  received,  from  what  sources,  and  the  disposi- 
tion thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  the  association  guarantee,  in  its  certificates,  fixed 
amounts  to  be  paid,  regardless  of  amount  realized  from  assessments, 
dues,  admission  fees  and  donations? 

14.  If  so.  state  amount  guaranteed,  and  the  security  of  such 
guarantee. 

15.  Has  the  association  a  reserve  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested. 

17.  Has  the  association  more  than  one  class? 

18.  If  so,  how  many,  and  the  amount  of  indemnity  in  each. 

19.  Number  of  members  in  each  class. 

20.  If  voluntary,  so  state,  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law, 
and  at  what  time ;  giving  chapter  and  year  and  date  of  passage  of 
the  act. 

22.  If  organized  under  the  laws  of  any  other  State,  province 
or  territory,  state  such  fact  and  the  date  of  organization,  giving 
chapter  and  year  and  date  of  passage  of  the  act. 


984  FRATERNAL    SOCIETY    LAW 

23.  Number  of  certificates  of  benefieiai-y  membership  lapsed  dur- 
ing the  j^ear. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more  than 
one  class,  number  in  each  class. 

25.  Names  and  addresses  of  its  president,  secretary  and  treas- 
urer, or  corresponding  officers. 

The  Commissioner  of  Insurance  is  authorized  and  empowered  to 
address  au.y  additional  inquiries  to  any  such  association  in  relation 
to  its  doings  or  condition,  or  any  other  matter  connected  with  its 
transaction  relative  to  the  business  contemplated  by  this  act,  and 
such  officers  of  .such  association  as  the  Commissioner  of  Insurance 
may  require  shall  promptly  reply  in  writing,  luider  oath,  to  all  such 
inquiries. 

Agent  in  This  State — Legal  Process. 

Section  122.  Each  such  association  now  doing  business  or  here- 
after admitted  to  do  business  in  this  State  and  not  having  its 
principal  office  within  this  State,  and  not  being  organized  under  the 
laws  of  this  State,  shall  appoint,  in  writing,  the  Commissioner  of 
Insurance  and  his  successors  in  office  to  be  its  true  and  lawful  attor- 
ney, upon  whom  all  lawful  process  in  any  action  or  proceeding 
against  it  must  be  served,  and  in  such  writing  shall  agree  that  any 
lawful  process  against  it  which  is  served  on  said  attorney,  shall  be 
of  the  same  legal  force  and  validity  as  if  served  upon  the  associa- 
tion, and  that  the  authority  shall  continue  in  force  so  long  as  any 
liability  remains  outstanding  in  this  State.  Copies  of  such  certificate, 
certified  by  said  Commissioner  of  Insurance,  shall  be  deemed  suffi- 
cient evidence  thereof,  and  shall  be  admitted  in  evidence  with  the 
same  force  and  effect  as  the  original  thereof  might  be  admitted. 
Service  upon  such  attorney  shall  be  deemed  sufficient  service  upon 
such  association. 

When  legal  process  against  any  such  association  is  served  upon 
said  Commissioner  of  Insurance,  he  shall  immediately  notify  the 
association  of  such  service  by  letter,  prepaid  and  directed  to  its 
secretary  or  corresponding  officer,  and  shall  within  two  days  after 
such  service  forward   in   the  same  manner  a   copy  of  the   process 


THE    STATE    OF    WASHINGTON  985 

served  ou  him  to  such  officer.  The  plaintiff  iu  such  process  so 
served  shall  paj^  to  the  Commissioner  of  Insurance  at  the  time  of 
such  service  a  fee  of  $3,  which  shall  he  recovered  by  him  as  part 
of  the  taxable  costs,  if  he  prevails  in  the  suit.  The  Commissioner 
of  Insurance  shall  keep  a  record  of  all  processes  served  upon  him, 
which  record  shall  show  the  day  and  hour  when  such  service  was 
made. 

Issuance  of  Permits — Fee. 

Section  123.  The  Commissioner  of  Insurance  of  this  State  shall, 
upon  the  application  of  any  association  having  the  right  to  do  busi- 
ness within  this  State,  as  provided  by  this  act,  i.ssue  to  such  associa- 
tion a  permit  in  writing,  authorizing  such  association  to  do  business 
within  this  State,  for  which  certificate  and  all  proceedings  in  con- 
nection therewith,  such  association  shall  pay  to  said  commissioner 
the  fee  of  $5. 

Formation  of  Beneficiary  Associations. 

Section  124.  Any  number  of  persons,  not  less  than  ten,  residents 
of  the  State  of  Washington,  and  citizens  of  the  United  States,  may 
form  a  fraternal  beneficiary  society,  order  or  association,  for  the 
purjjoses  set  forth  in  this  act,  by  filing  in  the  office  of  Insurance 
Commissioner  a  declaration  signed  by  each  of  the  corporators  and 
duly  acknowledged  before  an  officer  authorized  under  the  laws  of 
this  State  to  take  acknowledgments,  and  shall  therein  express  their 
intention  of  forming  a  fraternal  beneficiary  society,  order  or  asso- 
ciation for  beneficiary  purposes,  which  said  declaration  shall  also 
contain  the  proposed  name  of  the  society,  order  or  association,  which 
shall  not  be  the  same  as,  nor  too  closely  resemble,  the  name  of  any 
other  society,  order  or  association,  organized  under  the  laws  of 
this  State  or  doing  business  in  this  State ;  the  mode  and  manner  in 
which  the  powers  granted  by  this  act  are  to  be  exercised;  the  place 
of  doing  business  fully  and  clearly  defined;  the  limit  as  to  age  of 
applicant  or  beneficiary  member.ship,  which  shall  not  exceed  fifty 
years,  and  that  medical  examinations  are  required  of  members  for 
life  benefits;  the  name  and  official  titles  of  the  officers,  trustees. 


986  FRATERNAL    SOCIETY    LAW 

directors,  representatives  or  other  persons,  by  whatsoever  name  or 
title  designated,  who  are  to  have  and  exercise  the  general  control 
and  management  of  its  affairs  and  all  its  funds,  who  shall  be  elected 
after  the  first  year  by  representatives  chosen  by  subordinate  lodges, 
councils  or  bodies,  or  grand  lodges,  grand  councils  or  bodies,  as 
the  laws  of  the  society,  order  or  association  may  provide,  who  shall 
be  members  of  such  society,  order  or  association.  Such  first  officers 
of  any  such  society,  order  or  association  shall  not  hold  office  longer 
than  one  year  unless  re-elected  by  a  majority  of  the  members 
thereof. 

Shall  Not  Employ  Paid  Agents. 

Section  125.  Such  associations  shall  not  employ  paid  agents  in 
soliciting  or  procuring  members,  except  in  the  organization  or 
building  up  of  subordinate  bodies  or  granting  members  inducements 
to  procure  new  members. 

Contracts — When  Not  Valid. 

Section  126.  No  contract  with  any  such  association  shall  be  valid 
when  there  is  a  contract,  agreement  or  understanding  between  the 
member  and  the  beneficiary  that  the  benefieiaiy  or  any  person  for 
him  shall  pay  such  member's  assessments  or  dues,  or  either  of  them. 

Funds  Not  Liable  to  Attachment. 

Section  127.  The  money  or  other  benefit,  charity,  relief  or  aid  to 
be  paid,  provided  or  rendered  by  any  association  authorized  to  do 
business  under  this  act,  shall  not  be  liable  to  attachment  by  trustee, 
garnishee  or  other  process,  and  shall  not  be  seized,  taken,  appropri- 
ated or  applied  by  any  legal  or  equitable  process,  or  by  operation 
of  law,  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any 
beneficiary  named  in  a  certificate,  or  any  person  who  may  have  any 
rights  thereunder. 

Showing  Required — Foreign  Companies. 

Section    128.     No   associatinn    ii<it    .Tdmitted   to   transact  business 


THE    a  TATE    OF    WASHINGTON  987 

within  this  State  prioi'  to  tlie  passage  of  this  aet  shall  be  incorpo- 
rated or  given  a  permit  or  certificate  of  authority  to  transact  business 
within  this  State,  as  provided  for  by  this  act,  unless  it  shall  first 
show  that  the  mortuary  assessment  rates,  provided  for  in  whatever 
plan  of  business  it  has  adopted,  are  not  lower  than  is  indicated  as 
necessary  by  the  following  mortality  table: 

■  FRATERNAL  CONGRESS  MORTALITY  TABLE. 

Probability  of  Dying. 
.U05U00 
.005035 
.005071 
.005107 
.005153 
.005201 
.005259 
.005318 
.005388 
.005469 
.005552 
.005647 
.005753 
.005872 
.006004 
.006149 
.006307 
.006490 
.006698 
.006921 
.007171 
.007448 
.007766 
.008113 
.008480 
.008867 
.009287 
.009754 


Age. 

No.  Living. 

No.  Dying 

20 

100,000 

500 

21 

99,500 

501 

22 

98,999 

502 

23 

.  98,497 

503 

24 

97,994 

505 

25 

97,489 

507 

26 

96,982 

510 

27 

96,472 

513 

28 

95,959 

517 

29 

95,442 

522 

30 

94,920 

527 

31 

94,393 

533 

32 

93,860 

540 

33 

93,320 

548 

34 

92,772 

557 

35 

92,215 

567 

36 

91,648 

578 

37 

91,070 

591 

38 

90,479 

606 

39 

89,873 

622 

40 

89,251 

640 

41 

88.611 

660 

42 

87,951 

683 

43 

87,268 

708 

44 

86,560 

734 

45  . 

85,826 

761 

46 

85,665 

790 

47 

84,275 

822 

988  FRATERNAL    SOCIETY    LAW 


^ge. 

No.  Living. 

No.  Dying.  I 

Probability  of 

48 

83,453 

857 

.0102693 

49 

82,596 

894 

.0108238 

50 

81,702 

935 

.0114440 

51 

80,767 

980 

.0121337 

52 

79,786 

1,029 

.0128970- 

53 

78,757 

1,083 

.0137511 

54 

77,674 

1,140 

.0146767 

55 

76,534 

1,202 

.0157054 

56 

75,332 

1,270 

.0168587 

57 

74,062 

1,342 

.0181200 

58 

72,720 

1,418 

.0194994 

59 

71,302 

1,501 

.0210513 

60 

69,801 

1,588 

.0227504 

61 

68,213 

1,681 

.0246434 

62 

66,532 

1,778 

.0267240 

63 

64,754 

1,880 

.0290330 

64 

62,874 

1.985 

.0315711 

65 

60.889 

2,094 

.0343904 

66 

58,795 

2,206 

.0375206 

67 

56,589 

2,318 

.0409620 

68 

54,271 

2,430 

.0447753 

69 

51,841 

2,539 

.0489767 

70 

49,302 

2,645 

.0536489 

71 

46,657 

2,744 

.0588122 

72 

43,913 

2,832 

.0644912 

73 

41,081 

2,909 

.0708113 

74 

38,172 

2,969 

.0777795 

75 

35,203 

3,009 

.0854751 

76 

32,194 

3,026 

.0939927 

77 

29,168 

3,016 

.1034010 

78 

26,152 

2,977 

.1138345 

79 

23,175 

2,905 

.1253506 

80 

20,270 

2,799 

.1385163 

81 

17,471 

2,659 

.1521951 

82 

14,812 

2,485 

.1677694 

83 

12,327 

2,280 

.1849599 

THE    HTATE    OF    WASHINGTON  9y9 

Age.         No.  Living.         No.  Dying.     Probability  of  Dying. 

84  10,047       2,050        .1855707 

85  7,997  1,800  .2250844 

86  6,197  1,53'J  .2483460 

87  4,658  1,227  .2741520 

88  3,381  1,023  .3025732 

89  2,358  788  .3341815 

90  1,570  579  .3687898 

91  991  404  .4076690 

92  587  264  .4497445 

93  323  161  .4984520 

94  162  89  .5493827 

95  73         44        .6027397 

96  29         19        .6551724 

97  10  7        .7000000 

98  3  3        1.0000000 

Meetings  in  Other  States. 

Section  129.  Aiiy  such  association,  organized  under  the  laws  of 
this  State,  may  provide  for  the  meetings  of  its  legislative  or  govern- 
ing body  in  any  other  State,  province  or  territory,  wherein  such  asso- 
ciation shall  have  subordinate  bodies,  and  all  business  transacted  at 
such  meeting  shall  be  valid  in  all  respects,  as  if  such  meetings  were 
held  within  the  State,  and  where  the  laws  of  anj'^  such  association 
provide  for  the  election  of  its  officers  by  votes  to  be  cast  in  its  sub- 
ordinate bodies,  the  votes  so  cast  in  its  subordinate  bodies  in  any 
other  State,  province  or  territory,  shall  be  valid  as  if  cast  within 
this  State. 

False  or  Fraudulent  Statements — Penalty. 

Section  130.  Any  person,  officer,  member  or  examining  physician 
who  shall  knowingly  or  wilfully  make  any  false  or  fraudulent  state- 
ment or  representation  in  or  with  reference  to  any  application  for 
membership,  or  for  the  purpose  of  obtaining  any  money  or  benefit  in 
any  association  transacting  business  under  this  act,  shall  be  guilty 
of  a  misdemeanor,  and  upon  conviction  shall  be  punished  by  a  fine 


990  FRATERNAL    SOCIETY    LAW 

of  not  less  than  $100,  nor  more  than  $500,  or  imprisonment  in  the 
county  jail  for  not  less  than  thirty  days  nor  more  than  one  year,  or 
both,  in  the  discretion  of  the  court;  and  any  person  who  shall  wil- 
fully make  a  false  statement  of  any  material  fact  or  thing  in  a 
sworn  statement  as  to  the  death  or  disability  of  a  certificate  holder 
in  any  such  association  for  the  purpose  of  procuring  payment  of  a 
benefit  named  in  the  certificate  of  such  holder,  and  any  person  who 
shall  wilfully  make  any  false  statement  in  any  verified  report  or 
declaration  under  oath  required  or  authorized  by  this  act,  shall  be 
guilty  of  per j my,  and  shall  be  pi'oceeded  against  and  punished  as 
provided  by  the  statutes  of  this  State  in  relation  to  the  crime  of 
perjury. 

Neglect  to  Report — Injunction — ^Penalty. 

Section  131.  Any  such  association  refusing  or  neglecting  to  make 
the  report,  as  provided  in  this  act,  shall  be  excluded  from  doing 
business  within  this  State.  Said  Commissioner  of  Insurance  must 
within  twenty  days  after  failure  to  make  such  report,  or  in  ease 
any  such  association  shall  exceed  its  powers  or  shall  conduct  its 
business  fraudulently,  or  shall  fail  to  comply  with  any  of  the  pro- 
visions of  this  act,  give  notice  in  writing  to  the  Attorney  General, 
who  shall  immediately  commence  an  action  against  any  such  asso- 
ciation to  enjoin  the  same  from  carrying  on  any  business.  And  no 
injiuiction  against  any  such  association  shall  be  granted  by  any 
court,  except  on  application  by  the  Attorney  General,  at  the  request 
of  the  Commissioner  of  Insurance,  whether  the  State  or  a  member 
or  other  party  seeks  relief.  No  association  so  enjoined  shall  have 
authority  to  continue  business  until  such  report  shall  be  made,  or 
overt  act  or  violations  complained  of  shall  have  been  corrected,  nor 
until  the  cost  of  such  action  be  paid  by  it,  provided  the  court  shall 
find  that  such  association  was  in  default,  as  charged,  whereupon 
the  Commissioner  of  Insurance  shall  reinstate  such  association,  and 
not  until  then  shall  such  association  be  allowed  to  again  do  business 
in  this  State.  Any  officer,  agent  or  person,  acting  for  any  associa- 
tion or  s\ibordinate  body  thereof,  within  this  State,  while  such  asso- 
ciation shall  be  so  enjoined  or  prohibited  from  doing  business  pur- 
suant to  this  act,  shall  bo  doomed  guilty  of  n  misdemeanor,  and  on 


THE    STATE   OF    WASHINGTON  991 

conviction  thereof,  shall  bo  punished  by  a  fine  not  less  than  $25  nor 
more  than  $1200,  or  by  imprisonment  in  the  county  jail  for  not  less 
than  thirty  days  nor  more  than  one  yeai",  or  both  such  tine  ;nid  im- 
prisonment, in  the  discretion  of  the  eourt. 

Acting  for  Companies  Failing  to  Comply. 

Section  132.  Any  person  who  shall  act  within  this  State  as  an 
officer,  agent,  or  otherwise,  for  any  association  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provisions  of  this  act,  or  shall  have  failed  or  neglected 
to  procure  from  the  Commissioner  of  Insurance  proper  certificate  of 
authority  to  transact  business,  as  provided  for  by  this  act,  shall  be 
subject  to  the  penalty  provided  in  the  last  preceding  section  for  the 
misdemeanor  therein  specified. 

Act  Does  Not  Apply  to  Certain  Societies. 

Section  133.  Nothing  contained  in  this  act  shall  be  construed  to 
affect  the  Independent  Order  of  Odd  Fellows  as  they  now  exist  nor 
any  grand,  subordinate  lodge  or  other  body  of  Free  and  Aceejited 
Masons,  nor  the  grand,  nor  any  subordinate  lodge  of  the  Knights 
of  Pythias,  exclusive  of  the  Endowment  Rank,  nor  any  association 
not  working  on  the  lodge  system  which  limits  its  cei'tificate  holders 
to  a  particular  class  or  to  the  employment  of  a  particular  town  or 
city,  designated  firm,  business  house  or  corporation. 

Waivers,  Provision  Against  Not  Called  to  Applicant's  Attention. 

A  provision  in  an  insurance  contract  that  none  of  its  terms  can  be 
modified  nor  any  forfeiture  under  it  waive  save  by  an  agreement  in 
writing  signed  by  the  president  or  secretary  of  the  company,  is  held 
not  binding  or  effective  whec  the  assured  had  no  knowledge  of  it, 
never  assented  to  it,  and  was  not  informed  that  the  contract  applied 
for  would  contain  such  a  provision. 

Cole  vs.  Union  Central  Life  Ins.  Co.,  Jan.,  1900,  22  Wash.  26. 


I 


992  FRATERNAL    SOCIETY    LAW 

Limitations,  Statutes  as  to  Time  to  Institute  Suit,  Valid. 

The  provisions  of  a  contract  requiring  suit  to  be  commenced 
within  one  year  from  the  death  of  the  insured,  is  valid. 

Hall  vs.  Union  Central  Life  Ins.  Co.,  Dec,  1900,  23  Wash.  610. 

Vested  Interest,  None  Under  Certificate. 

The  fact  that  a  member  obtains  a  certificate  in  which  his  wife  is 
named  as  beneficiar^y,  turned  same  over  to  her  with  the  intent  that 
it  should  be  hers,  and  makes  payments  thereunder  with  community 
funds  belonging  to  himself  and  wife,  will  not  give  the  wife  such 
a  vested  interest  therein  as  to  deprive  the  husband  of  the  power  of 
substituting  another  beneficiary. 

Cade  vs.  Head  Camp,  Woodmen  of  the  World,  Jan.,  1902,  27  Wash.  218. 

Beneficiaries,  Rules  for  Changing  May  be  Waived. 

The  provisions  of  the  laws  of  a  society  with  respect  to  the  mode 
of  procedure  in  which  members  change  their  beneficiaries  are  for 
the  protection  of  the  society  and  may  be  waived  by  it.  and  the 
beneficiaries  named  in  certificates  subsequently  siu-rendered  while 
new  ones  are  issued  cannot  complain  of  the  action  of  the  society  in 
waiving  regulations  with  respect  to  the  surrender  of  the  old 
certificates. 

Cade  vs.  Head  Camp.  Woodmen  of  the  World,  Jan.,  1902,  27  Wash.  218. 

Privileged  Testimony  of  Physician. 

The  testimony  of  a  physician  as  to  the  physical  condition  of  a 
patient  treated  by  him,  is  properly  excluded  as  privileged  where 
the  exclusion  extends  only  to  disclosures  while  the  professional 
relation  existed. 

Dubcich  vs.  Grand  Lodge.  A.  0.  U.  W..  Dec,  1903,  33  Wash.  651;  74 
Pac.  832. 


THE    kiTATE    OF    WASHINGTON  993 

Expulsion  of  Insane  Member. 

A  society  acquires  no  jurisdiction  to  expel  a  member  on  the  ground 
of  fraud  practiced  upon  it  in  tho  member's  application,  where,  at 
the  time  of  mailing  the  notice  of  the  hearing  upon  which  the  trial 
for  expulsion  was  predicated,  the  meml)er  is  insane  and  in  a  hos- 
pital, incapable  of  being  present,  unless  it  clearly  and  unmistakably 
appears  that  the  laws  of  the  society  authorized  such  procedure. 

Dubcich  vs.  Grand  Lodge,  A.  0.  U.  W.,  Dec,  1903,  33  Wash.  651;  74 
Pac.  832. 

Insane  Member,  Trial  of,  Etc. 

In  an  action  on  a  certificate  where  the  society  relies  upon  an 
expulsion  which  is  entered  against  the  deceased  member  while 
insane  and  without  jurisdiction,  and  his  death  occurs  before  he  can 
make  an  appeal,  and  the  beneficiary  has  no  right  of  appeal,  an 
action  in  the  courts  is  maintainable  l)y  the  beneficiary. 

Dubcich  vs.  Grand  Lodge,  A.  0.  U.  W.,  Dec,  1903,  33  Wash.  651;  74 
Pac.  S32. 

Forfeiture — Application  of  Advance  Payments. 

A  defense  of  forfeiture  for  non-payment  of  dues  cannot  be  made 
as  long  as  the  societ\'  has  sufficient  funds  of  the  member  in  its 
possession  and  which  it  is  its  duty  to  apply  to  the  payment  of 
assessments  levied  upon  the  member. 

Logsdon  vs.  Supreme  Lodge,  Fraternal  Union  of  America.  April.  1904, 
34  Wash.  666;  76  Pac.  292. 

The  N.  F.  C.  Table  of  Mortality  Approved. 

The  act  of  1901  regulating  fraternal  societies  by  fixing  a  rate  for 
assessments  not  lower  than  is  indicated  to  be  necessary  by  the 
National  Fraternal  Congress  Mortality  Table,  is  not  objectionable 
as  vague  and  uncertain,  nor  because  the  same  belongs  to  the  domain 
of  evidence  and  ought  to  be  subject  to  impeachment,  since  it  is 
63 


994  FRATERNAL    SOCIETY    LAW 

competent  for  the  legislature  to  determine  the  rate  by  adopting  such 
tables  and  incorporating  them  in  the  law. 

State  vs.  Fraternal  Knights  and  Ladies,  July,  1904,  35  Wash.  338; 
77  Pac.  500. 

Constitutionality  of  Laws  Classifying  Societies,  Valid. 

The  provisions  of  the  act  of  1901  regulating  new  corporations  to  be 
thereafter  authorized  to  do  business  in  the  State,  making  them  a 
class  under  themselves,  held  constitutional. 

State  vs.  Fraternal  Knights  and  Ladies,  July,  1904,  35  Wash.  338; 
77  Pac.  500. 

Suicide,  by  Insane  Member,  Rule  as  to. 

In  an  action  on  a  certificate  which  jjrovided  that  there  should  be 
no  liability  in  the  event  of  the  member's  death  by  suicide,  and 
where  it  is  claimed  that  the  suicide  was  due  to  the  member's  in- 
sanity, it  is  proper  to  instruct  the  jury  that  there  is  no  liability  if 
the  deceased  was  in  the  possession  of  his  ordinary  faculties,  but  that 
liability  does  attach  if  the  suicide,  although  intentional,  was 
committed  while  the  reasoning  faculties  of  the  member  were  so  far 
impaired  that  he  could  not  understand  the  character  and  effect  of 
the  act,  or  if  he  was  impelled  thereto  by  an  insane  impulse  which 
he  could  not  resist. 

Knapp  vs.  Order  of  Pendo,  Jan.,  1905,  36  Wash.  601;  79  Pac.  209. 

Proofs  of  Loss,  False  Statements  in. 

False  swearing  in  proofs  of  loss,  in  order  to  void  liability  upon 
the  contract,  must  relate  to  material  matters. 

Herzog  vs.  Palatine  Ins.  Co.,  Jan.,  1905,  36  Wash.  611;  79  Pac.  287. 

Agency — Stipulations  Against. 

A  provision  in  n  fire  iiisiir;nice  policy  to  the  effect  that  no  person, 


I 


THE    STATE    OF    WASHINGTON  996 

unless  authorized  in  writing,  shall  be  deemed  the  agent  of  the  com- 
pany, does  not  make  a  solicitor  the  agc^nt  of  the  insured,  but  he  is 
the  agent  of  the  company,  and  his  knowledge  of  matters  material 
to  the  risk  becomes  the  knowledge  of  tlu^  company. 

Foster  vs.   Pioneer  Mutual   Ins.  Assn.,  March,  1905,  37  Wash.   288; 
79  Pac.  798. 

Agency — Proofs  of  Loss. 

The  acts  of  the  secretary  of  an  insurance  company  in  resisting 
payment  and  refusing  to  treat  with  the  insured  solely  on  the  ground 
that  notice  of  loss  was  not  given  within  the  time  limited,  held  to  be 
the  acts  of  the  company,  and  that  the  company  is  estopped  to  set 
up  the  defense  that  pi'oofs  of  loss  were  not  fui'nished  within  the 
time  required  after  giving  the  notice. 

Moore  vs.  National  Accident  Society,  March,  1905,  38  Wash.  31;   80 
Pac.  171. 

Foreign  Society,  Service  Upon. 

The  statute  requiring  foreign  societies  to  appoint  the  State  in- 
surance commissioner  its  attorney  in  fact,  upon  whom  service  of 
process  may  be  made  with  the  same  legal  effect  as  if  made  upon 
the  society,  held  not  to  authorize  the  commissioner  to  admit  or  waive 
service  where  no  legal  service  has  in  fact  been  made,  nor  the  deputy 
insurance  commissioner  to  receive  service,  as  the  power  is  derived 
from  the  appointment  and  does  not  pertain  to  the  ofSce.  And  it  is 
further  held  that  in  such  ease  a  service  upon  the  statutory  appointee 
by  mail  is  insufficient. 

Bennett  vs.  Suprems  Tent,  Knights  of  the  Maccabees,  Oct.,  1905,  40 
Wash.  431;  82  Pac.  744. 

Expulsion,  When  Reviewable  by  Courts. 

The  expulsion  of  a  member  will  not  be  reviewed  except  to  ascer- 
tain whether  the  proceedings  were  regular,  in  good  faith,  and  not 
in  violation  of  the  laws  of  the  land. 


996  FRATERNAL   SOCIETY   LAW 

Kelly  vs.  Grand  Circle.  Women  of  Woodcraft,  Dec,  1905,  40  Wash. 
691;   82  Pac.  1007. 

Charges  as  Basis  for  Trial  and  Expulsion. 

Charges  of  a  general  nature  which  are  preferred  against  a  member 
accusing  the  member  of  threats  to  wrongfully  use  the  funds  of  the 
society  and  of  slandering  other  members  and  officers,  are  sufficient 
to  sustain  an  order  of  expulsion  from  the  society,  where  the  mem- 
ber did  not  point  out  where  the  charges  should  be  made  more 
specific. 

Kelly  vs.  Grand  Circle,  Women   of  Woodcraft,   Dec,   1905,  40  Wash. 
691;    82  Pac.  1007. 

Application  in  Conflict  with  Receipt. 

Where  an  application  for  insurance  upon  a  printed  form  conflicts 
with  the  statements  in  the  written  receipt,  the  latter  controls. 

Starr  vs.  Mutual  Life  Ins.  Co.,  Dec,  1905,  41  Wash.  228;  S3  Pac.  116. 

Dependency,  Rule  as  to  Evidence  of. 

Under  the  statutes  of  the  State  and  the  laws  of  a  society  author- 
izing the  payment  of  benefits  to  persons  dependent  upon  the  de- 
ceased, only  slight  evidence  of  dependency  is  necessary  where  the 
certificate  names  the  beneficiary  as  a  dependent  and  all  the  statutes 
and  by-laws  have  been  complied  with. 

Erickson   vs.   Modern   Woodmen   of   America,   July,    1906,   43   Wash. 
242;  86  Pac.  584. 

Warranty — What  Evidence  Competent  Under. 

In  an  action  upon  a  benefit  certificate  which  is  defended  by  the 
society  on  the  ground  that  the  deceased  had  made  false  repi'esenta- 
tions  to  the  .society  in  his  application  for  membership,  the  society 
is  not  a  party  defending  as  executor  or  legal  representative  of  or 
deriving  title  from  the  member,  Avithin  the  meaning  of  the  statute 


THE    STATE   OF   WASHINGTON  997 

prohibiting  evidence  of  a  party   as  to  transactions  had   with  the 
deceased. 

Erickson   vs.   Modern    Woodmen   of   America,   July,    1906,    43   Wash. 
242;  86  Pac.  584. 

Forfeiture — Insane  Member  Required  to  Pay  Assessments. 

The  insanity  of  a  member  is  no  excuse  for  his  non-payment  of  the 
dues  and  assessments  required  under  the  terms  of  the  contract. 

Sheridan  vs.  Modern  Woodmen  of  America,  Supreme  Ct.  Wash.,  Oct., 
190(;,   S7   Pac.  127. 

Agency — Provision  Against  Waivers. 

The  laws  of  a  societ.y  provided  that  no  oiBcer  of  any  local  camp 
was  authorized  to  waive  any  of  the  provisions  of  the  laws,  declared 
the  clerk  of  the  camp  to  be  the  agent  of  the  camp,  and  provided 
that  no  act  on  his  part  should  have  the  effect  of  creating  a  liability 
against  the  society.  The.y  also  provided  for  tlie  giving  of  notice  of 
assessments,  and  that  a  failure  to  pay  any  assessment  should,  ipso 
facto,  work  a  forfeiture.  After  a  member  became  insane,  the  mother 
of  his  minor  child,  who  was  the  beneficiary,  obtained  an  agreement 
from  the  clerk  of  the  local  camp,  that  he  would  notifv  her  of  assess- 
ments. It  was  held  that  such  an  agreement  was  not  binding  on  the 
society,  and  that  it  might  rel.y  on  a  forfeiture,  though  the  clerk  failed 
to  give  the  notice. 

Sheridan  vs.  Modern  Woodmen  of  America,  Supreme  Ct.  Wash.,  Oct., 
1906,  87   Pac.  127. 

Beneficiary — Right  to  Change. 

The  beneficiary  named  in  the  certificate  of  a  member  has  no  vested 
right  in  the  certificate,  and  the  member  ma,y  change  the  beneficiary 
at  will. 

Bernheim  vs.  Martin,  Supreme  Ct.  Wash.,  Dec.  1906,  88  Pac.  106. 


998  FRATERNAL    SOCIETY    LAW 

Agency — Fraud  Between  Agent  and  Applicant. 

An  exception  to  the  general  rule  that  notice  to  an  agent  is  notice 
to  his  principal,  arose  where  the  agent  and  plaintiff  conspired  to 
obtain  insurance  for  the  plaintiff  by  stating  the  plaintiff's  age  in 
his  application  to  be  five  years  less  than  it  really  was,  since  the 
plaintiff",  knowing  the  agent  was  acting  in  his  own  interest,  had  no 
right  to  assume  he  would  comniuuieate  the  plaintiff's  true  age  to 
his  principal. 

Elliott  vs.   Knights   of  the  Modern  Maccabees,   Supreme  Ct.  Wash., 
April,  1907,  89  Pac.  929. 

Age — False  Statement  as  to. 

An  applicant  stated  that  he  was  fifty  years  old,  whereas  he  was 
fifty-five  years  of  age,  as  he  knew,  and  for  that  reason  he  was  in- 
eligible to  membership,  the  certificate  was  void,  and  all  payments 
made  thereunder  were  forfeited,  he  having  in  his  application  de- 
clared all  his  answers  to  be  fair  and  true  and  agreed  that  they  should 
form  the  basis  of  his  contract.  It  was  held  that  the  statement  as  to 
his  age  being  material,  it  was  immaterial  whether  it  was  to  be  re- 
garded as  a  warranty  or  as  a  representation. 

Elliott  vs.  Knights  of  the  Modern  Maccabees,  Supreme  Ct.  Wash., 
April,  1907,  89  Pac.  929. 

Agency — Waivers  by  Course  of  Dealing  With  Members. 

Where  an  insurance  company,  bj''  a  course  of  dealing  with  refer- 
ence to  collecting  payments,  does  such  acts  as  would  lead  an  ordi- 
narily prudent  person  to  understand  and  believe  that  the  company 
would  not  insist  upon  strict  adherence  to  the  terms  of  the  contract 
as  to  the  time  when  payments  should  be  made,  but  would  accept 
payments  at  any  time  during  the,  month  for  which  they  were  due, 
it  was  held  that  the  company  had  waived  its  right  to  insist  on  for- 
feiture of  the  contract  for  non-payment  of  premiums  due  on  the 
first  of  the  month. 

Morgan  vs.  Northwestern  National  Life  Ins.  Co.,  February.  1906,  42 
Wash.  10;   84  Pac.  412. 


THE    STATE   OF   WASHINGTON  999 

Evidence  by  Non-Medical  Expert  Not  Competent. 

A  non-medical  expert  witness  may  not  in  an  action  on  a  certifi- 
cate answer  a  question  as  to  whether  he  saw  any  conduct  on  the  part 
of  the  member  that  would  indicate  to  the  witness  that  the  member 
had  a  certain  disease,  it  being  an  opinion  which  only  an  expert  was 
competent  to  give. 

Taylor  vs.  Modern  Woodmen  of  America.  March,  1906,  42  Wash.  304; 
84  Pac.  867. 

Evidence,  Secondary  not  Allowed  to  Explain  or  Waive  Medical 
Examination. 

The  writing  in  which  is  given  the  examination  made  by  the  local 
examiner  for  a  society,  of  an  applicant  for  membership,  is  the  best 
evidence  of  the  disclosures  then  made. 

Taylor  vs.  Modern  Woodmen  of  America,  March,  1906,  42  Wash.  304; 
84  Pac.  867. 


1000  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  WEST  VIRGESTA. 

CHAPTER  49. 

There  are  no  statutory  provisions  of  the  West  Virginia  law  ap- 
plicable to  Fraternal  Societies.  It  is  also  quite  remarkable  that  there 
are  so  few  insurance  cases  that  appear  in  the  court  reports  of  the 
State.  Such  as  have  been  found,  which  seem  to  have  to  do  with 
fraternal  society  questions,  however  remotely,  are  contained  herein 
by  reference. 

Evidence  as  to  Contract,  Parol  Agreements  Not  Competent. 

Where  parties  have  made  a  written  agreement,  the  writing 
is  regarded  as  the  exclusive  evidence  of  contract,  and  all  oral  nego- 
tiations and  stipulations  preceding  or  accompanying  the  execiition  of 
the  written  agreement  are  merged  in  it  and  are  not  admissible  in 
evidence  to  contradict  the  written  agreement. 

Providence  Washington  Insurance  Company  vs.  Board  of  Education, 
March,  1901,  49  W.  Va.  360. 

Privileged  Communications  of  Physician. 

The  law  governing  the  relation  of  physician  and  i)atient  does  not 
applj'  where,  under  an  insurance  contract  which  jjrovides  that  "any 
medical  adviser  of  the  company  shall  be  allowed  to  examine  the 
person  or  body  of  the  insured  in  respect  to  an  injury  or  cause  of 
death  in  such  manner  and  at  sucli  times  as  he  may  require,"  an  ex- 


THE    STATE    OF    WEST    VIRGINIA  1001 

amiuer  for  the  company  makes  examination  of  an   insured  person 
holding  a  contract  of  insurance  containino'  said  pi-ovision. 

Tompkins  vs.  Pacific  Mut.  Lite  Ins.  Co.,  May,  1903,  53  W.  Va.  479. 

Agency  of  Local  Official. 

An  insurance  company  establishing  a  local  agency  is  responsible 
to  the  parties  with  whom  the  agent  transacts  l)usiness,  for  his  acts 
and  declarations  within  the  scope  of  his  employment,  and  to  the  ex- 
tent of  the  authority  apparently  conferred  upon  him  by  the  company, 
and  the  limitation  upon  such  apparent  authority  not  communicated 
to  the  insured  before  he  acted  upon  the  representations  or  conduct 
of  the  agent  will  not  relieve  the  company  from  liability,  vinless 
after  discovery  of  the  want  of  authority  in  the  agent  the  insured 
has  precluded  himself  from  the  assertion  of  his  rights  by  laches. 

Medley  vs.  German  Alliance  Ins.  Co.,  March,  1904,  55  W.  Va.  342. 

Agency — Contract — Equitable  Estoppel. 

A  ^contract  in  writing  is  presumed  to  be  the  embodiment  of  an 
antecedent  verbal  agreement,  and  upon  clear  and  full  proof  that  the 
person  who  understood  the  preparation  of  it  has  by  mistake  or  fraud 
written  the  contract  different  from  what  it  was  as  made  by  the 
parties,  it  may  be  reformed  in  equity ;  and  where  such  departure 
occurs  in  a  contract  of  insurance  prepared  by  an  agent  of  the  com- 
pany, it  raises  an  equitable  estoppel  against  the  company  which  may 
be  effectually  asserted  by  the  insured  in  a  court  of  law,  unless  he 
had  notice  of  want  of  authority  in  the  agent  to  waive  the  conditions 
at  all  or  except  in  a  specific  manner. 

Medley  vs.  German  Alliance  Ins.  Co..  March,  1904,  55  W.  Va.  342. 

Agency  Extent  of  Power. 

Restrictions  inserted  in  a  contract  of  insurance  upon  the  power 
of  an  agent  to  waive  any  conditions  except  in  a  particular  manner, 


1002  FRATERNAL    SOCIETY    LAW 

as  by  endorsing  the  waiver  ou  the  contract,  do  not  apply  to  those 
conditions  which  relate  to  the  inception  of  the  contract. 

Medley  vs.  German  Alliance  Ins.  Co.,  March,  1904,  55  W.  Va.  342. 

Proofs  of  Loss  Waived  by  Denial  of  Liability. 

Denial  by  an  insurance  company  of  its  liability  on  other  grounds 
within  the  time  allowed  for  furnishing  preliminary  proofs  of  loss,  is 
in  law  a  waiver  of  the  conditions  of  the  contract  requiring  svich 
proofs. 

Medley  vs.  German  Alliance  Ins.  Co.,  March,  1904,  55  W.  Va.  342. 

Proofs  of  Loss — False  Affidavits. 

When  by  the  provisions  of  the  contract  it  shall  be  void  in  case 
of  fraud  or  false  swearing  by  the  insured  touching  any  matter  re- 
lating to  the  insurance  or  the  subject  thereof,  false  swearing,  in 
order  to  defeat  recovery,  must  be  intentional  and  done  for  the 
purpose  of  defrauding  the  insurer. 

Medley  vs.  German  Alliance  Ins.  Co.,  March,  1904,  55  W.  Va.  342. 

Forfeiture — No  Waiver  by  Holding  Members  Payment. 

Forfeiture  for  breach  of  a  promissory  warranty  is  not  waived  by 
the  retention  of  the  premium  after  notice  thereof. 

Medley  vs.  German  Alliance  Ins.  Co.,  March,  1904,  55  W.  Va.  342. 

Contract,  Situs  of,  Rule  as  to. 

Where  an  application  is  sent  by  an  applicant  or  his  agent  from 
one  state  to  an  insurance  companj'  in  another,  and  it  is  accepted 
and  a  contract  of  insurance  there  issued,  it  is  a  contract  of  the 
State  where  issued;  and  where  the  contract  provides  that  it  shall 
not  be  valid  until  coiuitersigned  by  its  agent  at  a  certain  place,  it 
is  a  contract  of  the  State  where  so  countersigned. 

Galloway  vs.  Standard  Fire  Ins.  Co.,  Nov..  1898,  45  W.  Va.  237. 


THE    STATE    OF    WISCONSIN  1003 


THE 

STATE  OF  WISCONSIN. 

CHAPTER  50. 

[1'he  section  numbers  employed  cori-espond  to  those  in  the 
slatutes.] 

Conditions  for  Organization  of  Mutual  Beneficiary  and  Fraternal 
Corporations,  Societies,  Orders  and  Associations. 

Section  1955a.  1.  No  fraternal  or  beneficiary  corporation,  society, 
order  or  association  for  the  relief  of  members  or  beneficiaries  or 
making  life  or  casualty  insurance  or  indemnity  upon  the  mutual  or 
assessment  plan  shall  be  incorporated  until  after  a  declaration 
signed  by  each  of  the  incorporators,  who  shall  be  residents  and 
citizens  of  this  State,  not  less  than  nine  in  number,  shall  have 
made  in  writing  and  sworn  to  by  them,  and  filed  in  the  office  of 
the  commissioner  of  insurance,  setting  forth  that  at  least  five  hun- 
dred persons  have  made  application  in  writing  for  membersliip  in 
such  proposed  corporation,  and  in  case  of  a  life  company  have  each 
been  examined  and  recommended  as  insurable  by  a  reputable  physi- 
cian, and  who  shall  have  deposited  five  dollars  each,  one  thousand 
dollars  of  which  sum  shall  be  pledged  for  the  payment  of  death 
losses.  And  the  table-rates  of  assessment  or  liability  of  each  person 
so  pledged  for  membership  shall  be  such  that  one  assessment  will 
realize  at  least  one  thousand  dollars  for  a  single  death  loss,  over  and 
above  all  sums  required  for  expenses,  reserves,  emergencies  or  other 
purposes. 

2.  No  fraternal  beneficiary  order  or  society  not  licensed  to  trans- 
act business  in  this  State  at  the  time  of  the  passage  of  this  act 


1004 


FRATERNAL    SOCIETY    LAW 


shall  be  incorporated  within  this  State  or  be  licensed  or  permitted 
to  transact  business  within  this  State,  unless  its  laws  require  the 
regular  payment  and  collection  of  rates  of  assessments  under  what- 
soever plan  of  business  it  has  adopted  not  lower  than  those  deduced 
from  the  National  Fraternal  Congress  Mortality  Table  computed 
upon  an  interest  assumption  of  four  per  cent.,  which  said  mortality 
table  is  as  follows: 


National  Fraternal  Congress  Mortality  Table. 


No.  Dying.     Probability  of  Dying. 


Age. 

No.  Living 

20 

100,000 

21 

99,500 

22 

98,999 

23 

98,497 

24 

97,994 

25 

97,489 

26 

96,982 

27 

96,472 

28 

95,959 

29 

95,442 

30 

94,920 

31 

94,393 

32 

93,860 

33 

93,320 

34 

92,772 

35 

92,215 

36 

91,648 

37 

91,070 

38 

90,479 

39 

89,873 

40 

89,251 

41 

88,611 

42 

87,951 

43 

87,268 

44 

86,560 

45 

85,826 

.500 
501 
502 
503 
505 
507 
510 
513 
517 
522 
527 
533 
540 
548 
557 
567 
578 
591 
606 
622 
640 
660 
683 
708 
734 
761 


.0050000 
.0050352 
.0050708 
.0051068 
.0051535 
.0052006 
.0052587 
.0053176 
.0053877 
.0054693 
.0055520 
.0056466 
.0057532 
.0058723 
.0060040 
.0061487 
.0063067 
.0064895 
.0066977 
.0069209 
.0071708 
.0074483 
.0077657 
.0081129 
.0084797 
.0088668 


1; 


THE   STATE   OF  WISCONSIN  1005 


Probability  of  Dying. 
.0092870 
.0097538 
.0102693 
.0108238 
.0114440 
.0121460 
.0128970 
.0137512 
.0146767 
.0157054 
.0168587 
.0181200 
.0194994 
.0210513 
.0227504 
.0246434 
.0267240 
.0290330 
.0315711 
.0343904 
.0375202 
.0409620 
.0447753 
.0489767 
.0536489 
.0588122 
.0644912 
.0708113 
.0777795 
.0854757 
.0939927 
.1034010 
.1138345 
.1253506 
.1380858 
.1521951 


Age. 

No.  Living. 

No.  Dying 

46 

85,065 

790 

47 

84,275 

822 

48 

83,453 

857 

49 

82,596 

894 

50 

81,702 

935 

51 

80,767 

981 

52 

79,786 

1,029 

53 

78,757 

1,083 

54 

77,674 

1,140 

55 

76,534- 

1,202 

56 

75,332 

1,270 

57 

74,062 

1,342 

58 

72,720 

1,418 

59 

71,302 

1.501 

60 

69,801 

1,588 

61 

68,213 

1,681 

62 

66,532 

1,778 

63 

64,754 

1,880 

64 

62,874 

1,985 

65 

60,889 

2,094 

66 

58,795 

2,206 

67 

56,589 

2,318 

68 

54,271 

2,430 

69 

51,841 

2,539 

70 

49,302 

2,645 

71 

46,657 

2,744 

72 

43,913 

2,832 

73 

41,081 

2,909 

74 

38,172 

2,969 

75 

35,203 

3,009 

76 

32,194 

3,026 

77 

29,168 

3,016 

78 

26,152 

2,977 

79 

23,175 

2,905 

80 

20,270 

2,799 

81 

17,471 

2,659 

1006  FRATERXfAL    SOCIETY    LAW 


^ge. 

No.  Living. 

No.  Dying. 

Probability  o 

82 

14,812 

2,485 

.1677694 

83 

12,327 

2,280 

.1849599 

84 

10,047 

2,050 

.2040410 

85 

7,997 

1,800 

.2250844 

86 

6,197 

1,539 

.2483460 

87 

4,658 

1,277 

.2741520 

88 

3,381 

1,023 

.3025732 

89 

2,358 

788 

.3341815 

90 

1,570 

579 

.3687898 

91 

991 

404  • 

.4076690 

92 

587 

264 

.4497445 

93 

323 

161 

.4984520 

94 

162 

89 

.5493827 

95 

73 

44 

.6027397 

96 

29 

19 

.6551724 

97 

10 

7 

.7000000 

98 

3 

3 

1.0000000 

The  payment  of  any  disability  benefits  promised  or  rendered  by 
any  such  society  or  order  hereafter  organized  or  admitted  to  this 
State  that  are  not  provided  for  in  the  rates  deduced  from  said  table 
of  mortality  as  is  herein  required  must  be  amply  provided  for  in 
addition  to  the  rates  of  assessments  as  herein  required. 

3.  lu  case  of  an  accideut  association  before  license  is  issued  it 
shall  deposit  with  the  State  treasurer  a  security  for  the  payment 
of  claims  against  said  corporation  in  case  of  voluntary  dissolution 
or  the  winding  up  of  its  affairs,  good,  interest  bearing  securities 
to  be  approved  by  the  commissioner  of  insurance  in  the  amount  in 
par  value,  exclusive  of  interest,  of  not  less  than  one  thousand  dol- 
lars; such  securities  shall  be  retained  by  the  State  Treasurer  so 
long  as  said  corporation  shall  continue  to  do  bu.siness.  Provided, 
That  said  corporation  may  at  any  time  upon  the  approval  of  the 
commissioner  of  insurance,  substitute  other  securities  of  equal  value; 
the  interest  on  said  securities  shall  be  payable  to  the  said  corpora- 
tion, and  in  case  of  the  dissolution  of  said  corporation  or  the  winding 
up  of  its  affairs,  the  said  securities  shall  be  delivered  to  the  duly  ap- 


i 


THE    STATE    OF    WISCONSIN  1007 

pointed  receiver  of  the  said  corporation  or  to  the  corporation  itself, 
upon  the  certificate  of  the  commissioner  of  insurance. 

4.  In  ease  of  associations  already  organized  and  doing  business 
under  the  provisions  of  this  act,  the  securities  herein  above  pro- 
vided for,  shall  be  deposited  with  the  State  treasurer  in  the  same 
manner,  for  the  same  purpose  and  to  the  same  effect  as  above  pro- 
vided, on  or  before  the  first  day  of  January,  1902.  Provided,  how- 
ever. That  when  by  the  statute  of  any  otlier  State,  mutual  benefit 
associations  doing  an  accident  or  health  business  organized  or  doing 
business  therein,  are  required  to  keep  on  deposit  with  the  State 
treasurer  or  other  State  officer,  securities  for  the  protection  of 
policyholders  generally  and  any  such  company  shall  furnish  to  the 
commissioner  of  insurance  of  this  State  the  certificate  of  the  proper 
officer  of  such  other  State,  showing  the  amount  and  character  of  the 
securities  so  deposited  with  him  and  it  shall  appear  therefrom  that 
the  said  securities  are  equal  in  market  value  and  availability  to  one 
thousand  dollars,  and  that  said  securities  consist  of  stock  or  bonds 
of  the  United  States  or  of  this  State  or  of  anv  citv  or  county  in  this 
State  authorized  bj'  act  of  legislature  to  issue  the  same  or  of  State, 
county  or  city  bonds  or  of  stocks  of  the  State  where  such  company 
or  association  is  organized  or  of  bonds  and  mortgages  on  improved 
real  estate,  worth  double  the  sum  loaned  thereon,  and  it  shall  fur- 
ther appear  from  the  laws  of  such  other  Staie  that  the  securities 
so  deposited  are  subject  to  be  made  available  to  satisfy  judgments 
of  policyholders  in  any  manner  corresponding  to  that  provided  for 
the  care  of  securities  deposited  under  this  act,  the  commissioner  of 
insurance  shall  thereupon  be  authorized  to  issue  to  such  company 
an  authority  or  license  to  transact  the  business  of  accident  and 
health  insurance  within  this  State,  without  any  such  deposit  of 
securities  with  the  State  treasurer  of  this  State  as  is  above  provided. 

Limit  of  Liability  Not  to  Exceed  One-tenth  of  Assets. 

Section  1955a-l.  (Sec.  1,  eh.  56,  1903).  No  casualty  or  accident 
insurance  company,  association,  society,  order  or  corporation  or- 
ganized under  Section  1955a  of  the  Wisconsin  statutes  of  1898,  as 
amended  by  Chapter  442  of  the  laws  of  1901 ;  and  no  such  company, 
association,  societj',  order  or  corporation,  now  or  at  any  time  here- 


1008  FRATERNAL   SOCIETY   LAW 

after  transacting  business  within  this  State,  shall  assume  a  greater 
liability  in  its  contracts  of  insurance  to  any  one  person,  payable  in 
case  of  death  of  the  assured,  than  one-tenth  of  the  amount  of  its 
assets  reported  to  the  Commissioner  of  Insurance,  and  in  actual 
existence  at  the  time  of  the  last  preceding  annual  report  to  the 
said  Commissioner  of  Insurance. 

Filing  Papers. 

Section  1955b.  No  such  articles  shall  be  tiled  with  the  Secretary 
of  State  or  recorded  by  any  register  of  deeds  until  a  copy  thereof 
and  of  the  by-laws,  blank  application  for  and  certificate  of  mem- 
bership, plan  of  doing  business  and  of  the  original  applications  for 
and  agreements  to  take  membership  have  been  deposited  with  the 
Commissioner  of  Insurance  and  satisfactory  evidence  is  produced  to 
him  that  the  sum  due  from  each  applicant  for  membership  has  been 
collected  or  duly  pledged,  and  that  a  single  assessment  levied  upon 
each  such  applicant  will  realize  one  thousand  dollars  net,  and  shall 
have  received  from  said  commissioner  a  certificate  reciting  that  said 
corporation,  society,  order  or  association  has  complied  with  the 
provisions  of  law ;  and  thereupon  may  file  such  articles  with  the 
Secretary  of  State  and  such  society,  order  or  association  become 
incorporated  under  Chapter  86  as  a  mutual  beneficiary  association. 
A  copy  of  such  certificate  of  incorporation  shall  be  filed  with  the 
Commissioner  of  Insurance,  together  with  a  copy  of  its  constitution 
and  by-laws,  setting  forth  its  plan  of  organization,  and  if  approved 
by  him  he  shall  issue  a  certificate  authorizing  said  corporation, 
society,  order  or  association  to  engage  in  the  business  of  insurance 
on  the  assessment  plan  as  set  forth  in  said  articles  or  constitution 
and  by-laws,  and  the  said  incorporators  and  those  who  may  become 
associated  with  them  or  their  successors  shall  be  entitled  to  trans- 
act business  in  accordance  with  the  provisions  of  law. 

Beneficiary. 

Section  1955c.  Any  member  of  such  society,  order  or  associa- 
tion may  mime  as  his  benefieiMry  any  person  or  persons  designated 
bv  the  laws  of  such  society,   order  or  association,   or  if  the  laws 


THE   STATE 'OF   WISCONSIN  1009 

thereof  ])(>riiiit,  his  insurance  may  be  made  j)ayah]i'  to  his  estate. 
Any  meml)er  may  chanjic  the  beneficiary  named  in  his  certificate  or 
policy  without  the  consent  of  such  beneficiary,  by  complying  with 
the  by-laws  of  the  society,  order  or  association  wliicli  issued  the 
same. 

Who  May  Not  Be  Insured — Reserve  Fund. 

Section  1955d.  No  corporation,  society,  order  or  association  in- 
suring lives  on  the  assessment  plan  .shall  be  organized  or  licensed 
to  do  business  in  this  State  if  it  permit  persons  to  become  members 
who  are  under  eighteen  or  above  sixty-one  years  of  age;  and  every 
such  organization,  except  casualty  associations  or  societies,  shall 
accumulate  and  maintain  a  reserve  or  emergency  fund  of  an  amount 
not  less  than  the  proceeds  of  one  death  or  disability  assessment  or 
periodical  call  on  all  policy  or  certificate  holders  thereof,  and  at 
least  equal  to  the  amount  of  its  maximum  certificate  or  policy,  and 
in  case  such  fund  or  any  portion  thereof  shall  have  been  used  for 
the  purpose  for  which  it  was  created  and  the  amount  thereof  re- 
duced to  less  than  the  proceeds  of  one  such  assessment  or  call  the 
amount  of  such  reduction  shall  be  made  up  and  restored  to  said 
fund  within  three  months  thereafter.  If  such  fund  is  in  excess  of 
double  the  proceeds  of  such  assessment  or  call  upon  the  entire 
membership,  the  excess  or  any  portion  thereof  may  be  used  in  re- 
duction of  assessments  or  calls ;  Provided,  That  the  provisions  for 
a  reserve  or  emergency  fund  shall  not  apply  to  any  such  corpora- 
tion heretofore  licensed  or  organized  in  this  State  or  to  any  fra- 
ternal order  or  lodge  heretofore  authorized  to  do  business  herein. 

Foreign,  When  May  Do  Business  Here. 

Section  1955e.  No  organization  furnishing  life  or  casualty  in- 
surance or  indemnity  upon  the  mutual  or  assessment  plan,  organ- 
ized under  the  laws  of  any  State  or  territory,  the  District  of  Co- 
lumbia or  any  foreign  country,  nor  any  organization,  whether  in- 
corporated or  not,  having  its  principal  place  of  business  outside  this 
State,  shall  transact  business  in  this  State  until  it  have  filed  with 
the  Commissioner  of  Insurance  an  application  for  admission,  upon  a 
64 


1010  FRATERNAL    SOCIETY    LAW 

form  prescribed  by  him,  setting  forth  its  membership,  claims  paid 
and  resources,  together  with  a  copy  of  its  articles  of  incorporation, 
of  its  constitution  and  by-laws,  its  application  for  membership,  its 
medical  examination  blank,  if  one  be  provided  for,  of  its  certificate 
or  policj'  and  of  the  literature  used  by  it  in  soliciting  business,  a 
certificate  from  the  Commissioner  of  Insurance  or  other  proper 
officer  of  the  State  in  which  said  organization  is  incorporated  or 
organized  certifying  that  it  is  authorized  to  transact  business  in 
such  State ;  that  its  business  is  honestly  conducted,  and  that  for  a 
period  of  two  years  prior  to  the  date  of  such  application  it  has  paid 
the  face  value  of  its  largest  certificate  or  policy  in  full  with  the  col- 
lections of  an  ordinary  assessment,  that  its  by-laws  require,  and 
the  laws  of  the  State  where  incorporated  or  under  which  it  exists 
permits,  the  accumulation  of  a  reserve  or  emergency  fund  equal  in 
amount  of  that  prescribed  by  Section  1955d;  Provided,  That  the 
membei'ship  of  such  corporation  shall  not  have  diminished  during 
the  year  in  which  such  application  is  made  or  during  the  year  next 
preceding;  Provided,  further,  That  the  provision  requiring  a 
reserve  or  emergency  fund  shall  not  apply  to  a  corporation  which 
is  engaged  in  the  business  of  casualty  insurance  and  only  pays 
death  losses  caused  by  accident,  if  such  corporation  shall  have  ac- 
cumulated and  maintained  a  fund  equal  aud  applicable  to  the  pay- 
ment of  the  face  of  its  largest  certificate  or  policy  in  force. 

Investigation — Service  of  Process — Name — Deceptive  Literature. 

Section  1955f.  The  commissioner  shall  investigate  the  character 
and  standing  of  all  such  organizations  applying  for  license,  and 
if  approved  by  him,  and  if  the  conditions  hereinbefore  imposed  have 
been  complied  with,  he  shall  notify  it  of  his  approval,  whereupon 
such  organization  shall  appoint  in  writing  the  Commissioner  of  In- 
surance or  his  successor  in  office  to  be  its  true  and  lawful  attorney, 
upon  whom  any  summons,  notice  or  process  in  any  action  or  pro- 
ceeding brought  upon  any  cause  of  action  or  business  or  transaction 
in  this  State  may  be  served,  and  in  such  wi-iting  sluill  agree  that 
any  such  summons,  notice  or  j)roeess  against  it  which  is  served  on 
said  attorney  shall  be  of  the  same  force  and  validity  as  if  such 


THE    STATE    OF    WISCONSIN  1011 

service  were  made  on  a  corporation  of  this  State;  and  such  authority 
shall  continue  in  force  so  long  as  there  is  any  liability  against  it 
in  this  State ;  Provided,  That  no  license  to  do  business  in  this  State 
shall  be  issued  to  any  such  organization  to  whose  country,  State  or 
territory  any  Wisconsin  corixiration,  society,  order  or  association, 
doing  business  on  the  assessment  plan,  which  has  complied  with  the 
requirements  of  the  laws  of  this  State,  has  been  or  would  be  re- 
fused admission  to  do  business  on  compliance  with  the  laws  thereof. 
The  commissioner  shall  also  refuse  license  to  do  business  to  any 
foreign  organization  whose  name  or  title  he  shall  deem  too  similar 
to  one  already  appropriated  or  likely  to  mislead  the  public.  These 
conditions  having  been  complied  with,  he  shall  issue  to  each  organ- 
ization a  license,  after  which  it  may  transact  business  in  this  State ; 
and  said  license  shall  continue  in  force  until  revoked  pursuant  to 
law;  Provided,  That  it  shall  l)e  cause  for  refusing  such  license  or 
for  revoking  it  if  the  literature  used  by  the  organization  in  solicit- 
ing business  is  misleading  in  respect  to  the  business  done  or  in  con- 
flict with  the  law  of  this  State.  All  such  licenses  shall  expire  on  the 
first  day  of  March  succeeding  the  date  of  their  issue. 

Annual  Report. 

Section  1955g.  Every  such  organization  authorized  to  do  busi- 
ness in  this  State  shall,  on  or  before  the  first  day  of  March  of  each 
year,  make  and  file  with  the  Commissioner  of  Insurance  a  report 
of  its  affairs  and  its  operations  during  the  year  ending  on  the  pre- 
ceding thirty-first  day  of  December.  Such  report  shall  be  upon 
blank  forms,  to  be  provided  by  such  commissioner,  and  shall  be 
verified  under  oath  by  the  proper  officers  thereof  and  be  published, 
or  the  substance  thereof  in  the  report  of  the  commissioner  under 
a  separate  part,  entitled  "Mutual  Benefit  Societies,  Order  or  Asso- 
ciations," and  shall  show: 

1.  Number  of  certificates  issued  during  the  year  or  members 
admitted. 

2.  Amount  of  indemnity  effected  thereby. 

3.  Number  of  losses  or  benefit  liabilities. 


1012  FRATERNAL    SOCIETY    LAW 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  in  each  class  for 
the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representa- 
tives and  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  have  been 
made. 

8.  Numljer  and  kind  of  claims  compromised  or  resisted,  and  brief 
statements  of  reasons. 

9.  Does  society  charge  annual  or  other  periodical  dues  or  ad- 
mission fees? 

10.  How  much  on  each  one  thousand  dollars  annually  or  per 
capita,  as  the  case  may  be? 

11.  Total  amount  received,  from  what  sources,  and  disposition 
thereof. 

12.  Total  amount  of  salaries  paid  to  officers. 

13.  Does  society  guarantee  in  its  certificate  fixed  amount  to  be 
paid  regardless  of  amount  realized  from  assessments,  dues,  admis- 
sion fees  and  donations? 

14.  If  so,  state  amount  guaranteed  and  the  security  of  such  guar- 
antee. 

15.  Has  the  society  a  reserve  fund? 

16.  If  so,  how  it  is  created,  and  for  what  purpose,  the  amount 
therefor,  and  how  invested. 

17.  Has  the  society  more  than  one  class? 

18.  If  so,  how  manj^,  and  the  amount  of  indemnity  in  each. 

19.  Number  of  members  in  each  class. 

20.  If  organized  under  the  laws  of  this  State,  under  what  law, 
and  at  what  time. 

21.  If  organized  under  the  laws  of  any  other  State  or  territory, 
the  District  of  Columbia  or  any  foreign  country,  state  such  fact 
and  the  date  of  organization,  giving  chapter  and  year  and  date  of 
passage  of  the  act. 

22.  Number  of  certificates  of  membership  in  force  at  beginning 
and  end  of  .year ;  if  more  than  one  class,  number  of  each. 

23.  Number  of  certificates  of  membership  lapsed  during  the  year. 

24.  Number  of  certificates  of  membership  in  force  in  this  State 


Till-:    t^TATE    OF    WISCONSIN  1013 

at  the  begiiiniug  and  cnil  of  year;  it'  more  tliaii  one  clasis,  tiiiniber 
of  each. 

25.  Number  of  certificates  of  nK^mbcrship  in  this  State  lapsed 
during  the  year. 

26.  Number  of  deaths  in  this  State  durinfi;  tiu'  year. 

27.  Number  and  amount  of  claims  paid  in  this  State  during  the 
year;  if  more  than  one  class,  number  and  amount  paid  in  each. 

28.  Have  all  claims  been  paid  in  full?     If  not,  why  not? 

29.  Approximate  maximum  and  average  age  of  membership  in 
each  class. 

30.  Liabilities,  assets,  contingent  liabilities,  contingent  assets. 

31.  A  schedule  giving  the  number  of  members  in  groups  accord- 
ing to  attained  ages,  the  amount  of  insurance  in  force,  the  amount 
received  in  premiums  or  mortuary  assessments  during  the  year,  the 
number  of  deaths,  and  the  amount  of  death  losses  incurred  during 
the  year  in  each  gi'oup  at  attained  age. 

Inspection  of  Books — Revocation  of  License. 

Section  1955h.  The  commissioner  may  address  any  additional  in- 
quiries to  any  such  organization  and  it  shall  be  the  duty  of  the 
proper  officers  thereof  to  reply  in  writing,  under  oath,  to  all  such 
inquiries.  All  such  organizations  and  their  books  and  papers  shall 
be  subject  to  visitation  and  inspection  by  the  commissioner  or  such 
person  as  he  may  designate.  Any  such  organization  refusing  or 
neglecting  to  make  such  report  or  an.swer  such  inquiries  shall  be 
excluded  from  doing  business  in  this  State.  Said  commissioner 
must,  within  thirty  days  after  failure  to  make  such  report  or  answer 
his  inquiries,  or  in  case  any  such  organization  shall  exceed  its 
powers  or  conduct  its  business  fraudulently  or  fail  to  comply  with 
any  of  the  provisions  of  law  applicable  thereto,  revoke  its  license, 
and  no  organization  whose  license  is  so  revoked  shall  continue 
business  until  such  report  shall  be  made,  questions  answered,  or 
overt  acts  or  violations  complained  of  shall  have  been  corrected  and 
the  costs  of  such  proceedings  be  paid  by  it,  whereupon  the  com- 
missioner shall  reinstate  the  organization  and  not  until  then  shall 
it  again  do  business  in  this  State. 


1014  FRATERNAL    SOCIETY    LAW 

Examination. 

Section  1955i.  The  Commissioner  of  Insurance  shall,  at  the  re- 
quest of  any  organization  doing  business  under  these  provisions, 
make  an  examination  thereof,  and  furnish  a  certificate  of  the  result, 
showing  all  its  assets,  how  invested,  and  such  other  particulars  as 
may  be  deemed  necessary  to  show  the  character  and  condition  of 
the  organization ;  and  the  necessary  expense  of  the  said  examina- 
tion shall  be  paid  by  it. 

Definitions. 

Section  1955j.  The  word  "assessment"  as  used  in  the  foregoiag 
provisions,  when  applicable  to  any  corporation,  society,  order  or 
association,  shall  mean  that  the  usual  method  employed  by  any 
organization  within  such  provisions  to  meet  its  death  losses  is  by 
assessments  upon  its  surviving  members,  or  that  the  amount  esti- 
mated or  required  to  meet  such  losses  shall  not  be  limited  to  a  fixed 
sum.  The  word  "organization,"  as  so  used,  shall  mean  all  such 
corporations,  societies,  orders  or  associations  as  are  within  the  fore- 
going provisions;  but  no  law  of  this  State  hereafter  passed  shall 
be  held  to  apply  to  fraternal  benefit  organizations  unless  they  are 
specifically  mentioned  in  said  law. 

Violation  of  Law. 

Section  1955k.  The  Commissioner  of  Insurance  shall  revoke  the 
license  of  any  organization  which  fails  to  comply  with  the  require- 
ments of  law;  and  all  necessary  expenses  incurred  by  him  and  by 
the  Attorney  General  in  enforcing  such  requirements  or  in  prose- 
cuting violations  thereof  shall  be  paid  out  of  the  general  fund,  on 
being  certified  to  by  the  Secretary  of  State  that  they  were  actually 
and  necessarily  incurred  for  the  purpose  stated. 

License  Fee. 

Section  19551.  Every  foreign  organization  which  is  licensed  to 
do  business  under  the  foregoing  provisions  shall  pay  an  annual 
license  fee  of  twentv-five  dollars;  but  societies  and  orders  of  this 


THE    STATE    OF    WISCONSIN  1015 

State  wliicli  liavc  m  State  Grand  Lodge  or  Council  therein  shall  not 
be  required  to  pay  such  fee. 

Reserve  Fund — Deposit  of  Securities. 

Section  1955ra.  Any  corporation,  society,  order  or  association 
transacting  business  under  the  foregoing  provisions  may  provide  by 
its  by-laws  for  the  aeciuuulation  of  a  reserve  oi'  guaranty  fnnd, 
which  may  be  invested  only  in  its  corjiorate  name  in  United  States, 
State,  county,  city  or  other  first-class  convertible  bonds  of  securities. 
Such  funds,  when  so  set  apart  and  invested,  shall,  with  the  increase 
thereof,  belong  to  such  corporation,  society,  order  or  association  and 
shall  be  used  only  to  guaranty  benefits  or  in  payment  of  fntnre 
assessments  or  otherwise  for  the  promotion  of  the  objects  for  which 
said  funds  are  specially  provided  and  set  apart.  Such  fund,  or 
part  thereof,  may  be  deposited  with  the  State  treasurer  for  the 
purpose  of  securing  certificate  holders,  and  such  treasurer  shall  re- 
ceive and  hold  in  trust  such  bonds,  stocks  or  other  securities  as  may 
be  offered  by  any  corporation,  society,  order  or  association  and  give 
a  receipt  for  the  same.  Every  corporation,  society,  order  or  asso- 
ciation depositing  such  securities  may  receive  the  income  thereof 
and  exchange  the  same  from  time  to  time  and  withdraw  the  same 
when  it  no  longer  desires  to  maintain  such  deposit. 

Reorganization  of. 

Section  1955n.  Any  corporation,  society,  order  or  association 
heretofore  incorporated  under  the  laws  of  this  State,  the  objects  of 
which  are  similar  to  those  specified  in  Section  1955a  and  having  a 
membership  of  not  less  than  five  hundred  may  re-incorporate  under 
the  provisions  of  Sections  1955a  to  1955m  on  filing  with  the  Com- 
missioner of  Insurance  a  resolution  adopted  by  the  unanimous  vote 
of  the  directors  of  governing  body  thereof,  expressing  their  purpose 
to  so  re-incorporate,  and  on  also  filing  with  him  a  statement  showing 
the  name  and  location  of  the  corporation,  the  purpose  for  which  it 
was  organized,  the  names  and  residences  of  its  president,  secretary, 
treasurer  and  directors,  its  place  of  business  or  principal  office  and 


1016  FRATERNAL    SOCIETY    LAW 

name  and  location  as  re-incorporated;  but  such  name  shall  not 
contain  the  names  of  individuals  as  the  names  of  individuals  are 
used  in  partnership  names,  nor  shall  it  be  so  similar  to  the  name 
of  any  existing  corporation  as  to  mislead  the  public ;  a  designation 
of  the  general  officers  of  the  corporation,  their  terms  and  the 
methods  of  their  election. 

The  legislature,  session  of  1907,  enacted  Chapter  637,  adding  to 
the  statutes  Section  1946x,  which,  while  not  specifically  referring 
to  fraternal  societies  in  express  terms  in  the  caption,  relates  to 
them  in  part  and  is  of  interest.     Same  is  as  follows : 

Section  1946x.  Unless  the  context  of  any  statute  or  law  relating 
to  life  insurance  indicates  otherwise,  the  following  words  and  phases 
shall  be  understood  in  the  sense  herein  set  forth  and  defined : 

1.  The  "amount  at  risk,"  in  any  policy  year,  is  the  difference 
between  the  sum  insured  in  such  policy  year  and  the  terminal  re- 
serve for  such  policy  year. 

2.  "Beneficiary,"  is  the  person  in  whose  favor  a  policy  is  written. 

3.  "Company,"  includes  all  corporations,  associations,  partner- 
ships or  individuals,  engaged  as  principals  in  the  business  of  life 
insurance,  except  fraternal  or  beneficiary  corporations,  societies, 
orders  or  associations  for  the  relief  of  members  or  beneficiaries,  or- 
ders or  associations  for  the  relief  of  members  on  the  mutual  or  as- 
sessment plan, 

4.  "Deposit,"  is  the  terminal  reserve  on  a  policy  discounted  to 
the  beginning  of  the  polie.y  year  at  the  rate  of  interest  assumed. 

5.  "Domestic  company,"  is  any  company  organized  or  incor- 
porated under  the  laws  of  this  State. 

6.  The  "expense  charge,"  for  any  policy  year  is  the  excess  of 
the  stipulated  premium  for  such  policy  year  and  the  terminal  re- 
serve of  the  preceding  policy  year  over  the  sum  of  the  mortality 
charges  and  deposit  for  such  policy  .year.  Under  the  net  level 
premium  plan,  with  uniform  gross  premium,  it  is  called  "loading." 

7.  "Foreign  company,"  is  any  company  not  organized  or  incor- 
porated under  the  laws  of  this  State. 

8.  "Insured,"  is  the  person  upon  whose  life  the  contract  of  in- 
surance is  written. 

9.  "Mortality  charge,"  is  the  provision  made  in  the  policy  at 


THE    STATE    OF    WISCONSIN  1017 

the  beginning'  of  the  policy  year  for  the  mortality  on  account  of 
such  policy  year,  according  to  the  expense  charges  assumed,  the 
table  of  mortality  adopted  ;[\\t\  liie  rate  of  interest  assumed. 

10.  "Policy,"  is  the  contract  issued  by  the  company  to  the  in- 
sured. 

11.  "Policy  anniversity, "  is  any  anniversary  of  tlie  date  of  the 
policy. 

12.  "Policy  year,"  is  the  year  beginning  with  the  date  of  the 
policy  or  any  anniversary  thereof. 

13.  "Premium,"  is  the  payment  stipulated  in  the  policy  to  be 
made  by  the  insured  to  the  company  during  any  one  policy  year. 

14.  The  "reserve,"  at  any  time  within  the  policy  year  is  the 
deposit  for  such  year  improved  at  the  assumed  rate  of  interest  to 
such  time  with  the  policy  year  together  with  the  proportional 
unused  part  of  the  mortality  charge  for  such  year. 

15.  The  "sum  insured"  under  a  policy  in  any  policy  year  is  the 
value  of  the  guaranteed  payments  and  benefits  stipulated  to  be  made 
or  granted  if  it  should  mature  within  such  policy  year. 

16.  The  "terminal  reserve,"  is  the  reserve  at  the  end  of  the 
policy  year  and  is  the  sum  sufficient,  with  the  premiums  coming 
due,  to  provide  for  the  future  expense  and  mortality  charges,  and 
mature  the  policy  according  to  its  terms,  all  computed  upon  the 
expense  charges  a.ssumed,  the  table  of  mortality  adopted  and  the 
rate  of  interest  assumed. 

Forfeiture — Waivers  of  Prompt  Payment  of  Assessments. 

A  society  whose  by-laws  provide  that  any  member  who  shall  be 
in  arrears  for  dues  for  a  specified  time  after  notice  shall  forfeit 
his  rights,  subject  to  being  rein.stated  on  payment  of  arrearages, 
does  not  waive  a  forfeiture  so  incurred  by  subsequently  making  a 
new  assessment  and  giving  notice  thereof  to  the  member  who  is  in 
default  for  non-payment  of  the  previous  one  within  the  time  limited, 
even  though  it  had  previously  accepted  payment  of  assessments 
after  they  were  due. 

Toelle  vs.  Central  Verein,  Oct.,  1897,  97  Wis.  322. 


1018  FRATERNAL    SOCIETY    LAW 

After-enacted  Laws  Reasonable  and  Valid. 

A  member  whose  certificate  makes  his  compliance  with  all  the 
laws  then  existing  or  subsequently  enacted  a  condition  precedent 
to  his  participation  in  benefits,  is  bound  by  a  by-law  adopted  after 
his  admission  providing  that  if  any  member  shall  engage  in  any 
prohibited  occupation — among  M'hich  was  classed  that  of  selling 
liquors — his  certificate  shall  be  void  and  he  shall  stand  suspended, 
and  that  no  action  of  the  society  shall  be  a  condition  precedent  to 
such  suspension,  and  that  the  subsequent  receipt  of  assessments 
shall  not  be  a  waiver  of  his  engaging  in  such  prohibited  occupation. 
It  was  further  held  that  such  a  by-law  was  reasonable,  and  that  a 
member  who,  after  admission  and  after  the  passage  of  said  law, 
had  opened  a  liquor  saloon,  though  he  personally  continued  his 
usual  business  and  operated  the  saloon  by  a  clerk,  was  under  the 
said  by-law  suspended,  and  that  the  society  did  not  waive  the  sus- 
pension by  afterwards  receiving  assessments  from  the  member. 

Schmiidt  vs.  Supreme  Tent  Knights  of  the  Maccabees,  Nov.,  1907,  97 
Wis.  528. 

Corporate  Name,  Right  to. 

A  foreign  societ.y  which  has  condticted  business  under  a  certain 
name  for  many  years  will  not  be  restrained  from  the  use  of  such 
name  at  the  suit  of  a  domestic  society  organized  under  a  similar 
name  for  similar  purposes  more  than  ten  years  after  the  former 
commenced  to  transact  in  this  State. 

High  Court  of  Wisconsin,  Independent  Order  of  Foresters  vs.  Com- 
missioner of  Insurance,  Dec,  1897,  98  Wis.  94. 

After-enacted  Suicide  Law  Valid. 

"Where  a  member  stipulated  in  his  application  that  he  would 
conform  in  all  respects  to  the  by-laws,  rules  and  regulations  then 
in  force  or  which  might  be  thereafter  adopted,  he  and  his  bene- 
ficiaries are  efi'ectually  bound  by  any  amendment  to  the  laws  adopted 
after  the  certificate  was  issued,  avoiding  it  in  case  the  insured  com- 


THI<:    HTATE    OF    WISCONSIN  1019 

mitted  suicide,  to  tlu'  same  extent  as  if  siicli  ])v-la\v  liad  been  in 
force  at  the  time  when  he  became  a  member. 

Hughes  vs.  Wisconsin   Odd   Fellows   Mvit.   Life   Ins.  Co.,  Jan.,  1898, 
98  Wis.   292. 

Death  in  Violation  of  Law,  Suicide  is  Not. 

Although  suicide  i.s  technically  a  crime,  it  is  not  within  the  mean- 
ing of  a  clause  in  an  insurance  contract  providing  that  death  in 
consequence  of  or  in  violation  of  law  is  an  excepted  risk. 

Patterson  vs.   Natural   Premium   Mut.   Life  Ins.  Co.,  .Tune,  1898,  100 
Wis.  118. 

Incontestable  Clauses,  What  is  Covered  by. 

False  statements  or  concealment  by  the  applicant  in  respect  to  his 
health  is  covered  by  an  incontestable  clause  in  the  contract. 

Patterson  vs.  Natural  Premium  Mut.   Life  Ins.  Co.,  .Tune,  1898,  100 
Wis.  118. 

After-enacted  Laws  Valid. 

After-enacted  by-laws  are  valid  and  binding  and  affect  certificates 
issued  before  the  adoption  of  such  by-laws. 

Loeflaer  vs.  Modern  Woodmen  of  America,  June,   1898.  lOU  Wis.  79. 

Agency,  Waivers  Through  Not  Favored. 

A  member  of  a  society  who  as  clerk  of  a  local  camp  receives  dues 
and  assessments  from  himself  after  he  has  forfeited  his  membership 
by  engaging  in  a  prohibited  business,  does  not  thereby  waive  such 
forfeiture. 

Loeffler  vs.  Modern  Woodmen  of  America,  June,  1898,  100  Wis.  79. 


1020  FRATERNAL    SOCIETY   LAW 

Resort  to  Civil  Courts  by  Members. 

Members  should  exhaust  their  remedies  of  ajipeal  provided  for 
iu  the  laws  of  the  society  before  applying  to  a  court  of  equity  for 
relief. 

Loefder  vs.  Modern  Woodmen  of  America,  June,  1898,  100  Wis.  79. 

Fraternal  Insurance  Society  Defined. 

An  insurance  corporation  furnishing  life  or  casualty  insurance  in 
consideration,  iu  whole  or  in  part,  of  contributions  by  its  members 
on  a  ba.sis  of  equality,  sufficient  to  meet  its  expenses  and  mature 
memberships  as  the  necessities  therefor  arise,  is  a  benefit  or  bene- 
ficiary corporation  furnishing  casualty  or  life  insiirance  upon  the 
mutual  assessment  plan,  within  the  meaning  of  Chapter  418,  laws  of 
1891,  exemption  certain  insurance  organizations  from  the  general 
insurance  laws  of  the  State. 

State  vs.  National  Ace.  Society,  May,  1899,  103  Wis.  208;  79  N.  W.  220. 

Assessments,  Receiving  Over-due  Payments. 

The  acts  of  a  society  in  receiving  past  due  assessments  on  a  cer- 
tificate are  an  element  in  determining  whether  a  waiver  of  prompt 
payment  was  agreed  to,  but  are  not  conclusive. 

Reisz  vs.  Supreme  Council,  American  Legion  of  Honor,  June,  1899, 
103  Wis.  427;  79  N.  W.  430. 

Beneficiary,  Change  of,  Requisites. 

A  member  desiring  to  change  his  beneficiar.y  must  make  the 
change  in  the  manner  required  by  the  laws  of  the  society,  and  any 
material  deviation  from  that  coarse  will  render  the  attempted 
change  ineffective ;  but  where  the  member  has  done  every  substantial 
act  required  of  him,  and  dies  before  the  new  certificate  is  actually 
issued,  and  only  formal  acts  on  the  part  of  the  society  remain  to  be 
done,  the  change  will  be  considered  to  have  been  made  even  in  an 
action  at  law. 


T///J    STAThl    OF    WISCONSIN  1021 

McGowan  vs.  Suprorac  Court,   Intlependcut  Order  of  Foresters,  Oct., 

1899,  104  Wis.  173. 

For  the  opinion  on  st^eond  ;ippeal,  where  the  holding  was  to  the 
same  effect,  see 

McGowan  vs.  Supreme  Court,  Independent  Order  of  Foresters,  Oct., 

1900,  107  Wis.  462. 

Material  Questions  and  Answers  in  the  Application. 

The  answers  of  an  applicant  to  questions  concerning  the  health, 
death,  or  age  at  death  of  his  ancestors  and  brotliers  and  sisters,  are 
material  as  a  matter  of  law,  and  it  is  error  to  snlimit  the  question 
of  their  materiality  to  the  jury,  even  though  such  answers  are  made 
the  basis  of  the  contract  and  declared  to  be  warranties  only  so  far 
as  they  are  material. 

McGowan  vs.  Supreme  Court.  Independent  Order  of  Foresters.  Oct., 
1899,  104  Wis.  173. 

Evidence,  Report  by  Local  Examiner. 

Where  the  examining  physician  is  an  officer  of  the  local  lodge, 
his  report  as  to  the  physical  condition  of  an  applicant,  made  after  a 
personal  examination,  is  a  statement  of  an  officer  of  the  society,  made 
as  a  part  and  within  the  scope  of  his  official  ditties,  and  as  such  is 
admissible  in  evidence  as  an  admission  of  the  instirer  under  the 
same  conditions  as  admissions  of  agents  generall.v. 

McGowan  vs.  Supreme  Court.  Independent  Order  of  Foresters.  Oct., 
1899,  104  Wis.  173. 

Assessments,  Suspension  and  Reinstatement. 

The  receipt  of  an  overdue  assessment  on  condition  that  the  mem- 
ber was  then  in  good  health  did  not  waive  a  forfeiture  caused  by 
the  delinquencj'  where  the  member  was  not  in  good  health,  and 
there  was  a  prompt  offer  to  return  the  payment  upon  discovery  of 
the  fact. 

Miles  vs.  Mutual  Reserve  Fund  Life  Assn.,  .Tan..  1901.  lOS  Wis.  421. 


1022  FRATERNAL    SOCIETY    LAW 

Suicide,  Proofs  of  Death,  Evidence. 

The  ijroofs  of  death  furnished  by  the  beneficiary  in  which  it  is 
shown  that  the  toember  came  to  his  death  by  suicide,  was  competent 
prima  facie  evidence  of  that  fact. 

Hart    vs.    Fraternal    Alliance,  Jan.,  1901,  108  Wis.  490. 

Proofs  of  Death,  Denial  of  Liability. 

A  denial  of  liability  made  at  the  expiration  of  the  time  for  furnish- 
ing proofs  of  death,  and  when  such  denial  could  not  in  any  way 
have  influenced  the  action  of  the  beneficiaries  with  respect  to  such 
proofs,  does  not  operate  as  a  waiver  of  defects  in  the  proofs  fur- 
nished. 

Hart    vs.    Fraternal    Alliance,  Jan.,  1901,  108  Wis.  490. 

Proofs  of  Death,  Requirements  Reasonable. 

Where  the  certificate  requires  that  in  case  of  an  inquest  being 
held  a  certified  copy  of  the  evidence,  verdict  and  proceedings  therein 
shall  be  attached  to  the  proofs  of  death,  such  stipulation  is  reason- 
able and  compliance  therewith  is  necessary  to  give  a  right  of  re- 
covery. 

Hart  vs.   Fraternal   Alliance,  Jan.,  1901,  108  Wis.  490. 

Certificate  Versus  Application. 

Where  there  is  a  variance  between  the  application  and  the  certifi- 
cate in  naming  the  beneficiary,  the  certificate  shall  control. 

Hutson  vs.  Jenson,  April,  1901,  110  Wis.  26. 

Tenders  Not  Required  of  Members  Unlawfully  Suspended. 

Where  a  member  has  been  notified  that  the  society  will  not  re- 
ceive any  more  money  from  him,  because  he  is  no  longer  a  member, 


THE   STATE   OF   WISCONSIN  1023 

his  rights  will  not  be  prejudiced  by  failure  to  tender  payments  of 
assessments  subsequently  made. 

Langnecker  vs.  Trustees  of  the  Grand  Lodge  A.  O.  U.  W.,  Sept.,  1901, 
111  Wis.  279. 

After-enacted  Laws  Valid — Prohibited  Occupations. 

A  by-law  providing  that  any  member  who  shall  after  a  certain 
date  enter  into  the  business  of  selling  liquor  by  retail,  shall  be  ex- 
pelled, applies  to  a  member  not  actually  engaged  in  the  prohibited 
business  at  the  time  mentioned,  even  though  he  had  been  so  engaged 
at  the  time  his  certificate  was  issued,  and  such  by-law  by  necessary 
implication  prohibits  members  from  entering  into  such  business. 

Langnecker  vs.  Trustees  of  the  Grand  Lodge  A.  O.  U.  W.,  Sept.,  1901, 
111  Wis.  279. 

Appeals  From  Void  Judgment  Not  Necessary. 

An  appeal  from  an  inferior  to  a  superior  tribunal  to  avoid  the 
effect  of  an  absolutely  void  proceeding,  is  unnecessary. 

Langnecker  vs.  Trustees  of  the  Grand  Lodge  A.  O.  U.  W.,  Sept.,  1901, 
111  Wis.  279. 

Insurance  Commissioner,  Mandamus  Against. 

The  insurance  commissioner  should  not  be  compelled  by  man- 
damus to  issue  a  license  where,  although  he  had  previous  refused 
on  insufficient  grounds  to  issue  the  same,  he  had  notified  the  appli- 
cant of  a  reconsideration  of  such  action,  and  at  the  time  of  the 
issuance  of  the  writ  was  proceeding  to  make  proper  examination 
into  the  affairs  and  condition  of  the  society. 

The  State,  ex  rel.  Court  of  Honor,  vs.  Giljohann,  Commissioner  of 
Ins.,  Sept.,  1901,  111  Wis.  377. 

Evidence — Admissibility  of  Declarations. 

The  beneficiary  in  a  certificate  issued  by  a  fraternal  society  has  so 


1024  FRATERNAL    SOCIETY    LAW 

far  a  vested  interest  therein  that  the  prior  declarations  of  the  mem- 
ber are  not  admissible  in  evidence  to  prove  falsit.v  of  the  statements 
in  the  application,  unless  thej'  were  made  at  or  about  the  time  of  the 
application  and  were  so  closely  related  with  and  explanatory  of 
some  act  or  fact  showing  the  then  condition  of  the  health  of  the 
member  as  to  be  a  part  of  the  res  gestae;  but  declarations  not  ad- 
missible under  the  above  rule  may  be  admissible  to  pi'ove  prior 
knowledge  on  the  part  of  the  member  of  the  falsity  of  some  state- 
ment in  the  application,  where  such  prior  knowledge  is  a  material 
fact  and  there  is  substantive  evidence  of  the  falsity  of  the  statement. 

Rawson  vs.  Milwaukee  Mut.  Life  Ins.  Co.,  Nov.,  1902,  115  Wis.  641. 

After-enacted  Laws,  How  Far  Lawful. 

A  certificate  issued  to  a  member  provided  that  the  contract  stated 
therein  was  subject  to  all  existing  by-laws,  rules  and  regulations, 
and  all  that  might  be  made.  Held,  that  such  reserve  power  war- 
ranted only  those  variances  required  in  matters  of  detail  necessary 
or  advisable  in  carrying  out  efficiently  the  fundamental  principle 
or  scheme  of  the  society,  and  not  in  changing  the  plan  itself  and 
nullifying  all  contracts  entered  into  under  it. 

Wuerfler  vs.  Trustees  Grand  Grove,  Order  of  Druids,  Nov..  1902,  116 
Wis.  19. 

Societies  Free  From  Judicial  Control,  How  Ear. 

In  matters  of  discipline  and  policy  not  manifestly  violating  private 
rights,  societies  are  supreme  and  independent  of  .iudieial  control, 
but  when  they  proceed  arbitrarily  manifestly  to  violate  the  private 
rights  of  their  members,  they  are  amenable  to  law  the  same  as  any 
other  person,  natural  or  artificial. 

Wuerfler  vs.  Trustees  Grand  Grove,  Order  of  Druids,  Nov..  1902.  116 
Wis.  19. 

Agency  of  Local  Officer,  What  is  Extent  of. 

The  laws  of  a  society  provided  that  the  local  tent  was  the  agent 


I 


THK    STATE    OF    WISCONSIN  1026 

of  its  members  in  collecting  dues  and  assessments,  and  that  the 
Supreme  Tent  should  not  be  liable  for  any  negligence  or  bound  by 
any  illegal  action  or  irregularity  of  such  local  tent.  The  laws 
further  provided  that  in  case  of  a  member's  suicide,  the  society 
should  be  liable  only  to  the  amount  of  the  assessments  paid  in. 
Four  days  after  the  death  of  a  member  by  suicide  the  collector  of  a 
local  tent  accepted  from  the  beneficiary  the  assessments  due  of  the 
date  of  the  member's  death.  Held,  that  if  such  reception  of  dues 
was  irregular,  it  was  the  error  of  the  beneficiary's  own  agent,  of 
which  she  could  not  take  advantage. 

Voelkel  vs.  Supreme  Tent,  Knights  of  the  Maccabees,  Jan.,  1903,  116 
Wis.  202. 

Evidence,  Admissions  in  Suicide  Case. 

Statements  of  a  beneficiary  in  proofs  of  death  giving  the  cause  of 
the  member's  death  as  suicide,  are  admissions  against  interest  and 
establish  prima  facie  the  fact  of  suicide. 

Voelkel  vs.  Supreme  Tent,  Knights  of  the  Maccabees,  Jan.,  1903,  116 
Wis.  202. 

Beneficiary,  Rule  as  to  Changes  of. 

Where  the  member  applying  for  a  change  of  beneficiary  has  done 
everything  required  of  him,  and  the  society  has  only  formal  acts 
to  perform  in  order  to  make  such  change  effective,  and  the  member 
dies  before  the  new  certificate  is  actvially  issued,  it  will  be  held  that 
the  change  of  beneficiary  must  be  deemed  complete. 

Waldum  vs.  Homstad,  Oct.,  1903,  119  Wis.  312. 

Membership,  Conditions  Precedent  to  Retaining. 

By  the  charter  and  laws  of  a  society  organized  for  the  sole  bene" 
fit  of  members  of  the  Roman  Catholic  church,  none  but  practical 
catholics  could  be  admitted,  and  members  were  requivpd  to  remain 
practical  catholics  and  communicants  of  that  church  in  order  to 
participate  in  the  benefits.  An  applicant  for  admission  agreed  that 
6.5 


1026  FRATERNAL    SOCIETY    LAW 

upon  any  failiii'e  to  conform  strictly  to  the  laws  of  the  society  he 
should  forfeit  all  rights  to  membership  and  benefit.  Afterwards  the 
member  was  married  by  a  protestant  minister,  and  ipso  facto  was 
excommunicated  and  ceased  to  be  a  catholic :  Held,  that  all  liability 
on  the  certificate  thereby  ceased,  the  provisions  of  the  contract  being 
self-executing. 

Barry  vs.  Order  of  Cath.  Knights,  Oct.,  1903,  119  Wis.  362. 

Beneficiary,  When  Unable  to  Take  Benefit. 

Where  a  certificate  was  i:)roenred  by  false  representations  of  the 
member  to  the  effect  that  the  beneficiary  named  was  one  of  the 
class  for  M-hose  benefit  the  mortuary  fund  was  established,  and  the 
fraud  was  not  discovered  until  after  the  member's  death,  such  bene- 
ficiary whose  rights  rested  on  the  certificate  alone  could  not  recover 
thereon. 

Koerts  vs.  Grand  Lodge.  Order  of  Hermann's  Sons,  Nov.,  1903,  119 
Wis.  520. 

To  the  same  effect  see 

Grand   Lodge   of  Wisconsin,   Order  of  Hermann's  Sons   vs.   Leml^e, 
March,  1905,  121  Wis.  483. 

"Survivors,"  Who  Are  Within  the  Term. 

A  certificate  was  payable  to  the  survivors  of  the  member.  It  was 
held  that  this  word  "survivors"  did  not  include  one  who  was  neither 
a  relative  of  the  deceased  member  nor  a  member  of  his  household 
nor  connected  with  him  by  marriage. 

Koerts  vs.  Grand  Lodge.  Order  of  Hermann's  Sons.  Nov.,  1903.  119 
Wis.  520. 

Limitations  on  Right  to  Sue  Valid. 

A  provision  of  a  contract  providing  that  no  suit  shall  be  main- 


I 
I 


THE    STATE    OF    Wll^CONSlN  1027 

tallied   unless  coniiiicnccd   williin   one  yoar  from   the  death   of  the 
lueinber,  is  valid. 

Fey  vs.  The  I.  O.  O.  F.  Mat.  Life  Ins.  Society,  Feb.,  1904,  120  Wis.  358. 

Taxation,  Clubhouse  of  Lodge  Not  Exempt. 

The  clubhouse  and  lodge  buildiiiy  ol'  a,  local  lods'i'  of  the  Benevo- 
lent and  Protective  Order  of  Elks,  designed  and  used  principally  to 
provide  accommodations  for  the  entertainment,  amusement  and  re- 
freshment of  members  of  the  lodge  and  their  families  and  guests, 
and  maintained  by  a  system  of  charges  to  members  regulated  with  a 
view  to  covering  all  expenses  incident  to  the  elublionse  feature,  and 
profit  resulting  being  paid  into  the  lodge  treasury,  is  not  exempt 
from  taxation  as  being  property  of  a  benevolent  association  not 
used  for  pecuniary  profit,  within  the  meaning  of  the  statiite. 

Trustees  of  Green  Bay  Lodge  vs.  City  of  Green  Bay,  Sept.,  ]904,  122 
Wis.  452. 

Beneficiary,  Right  to  Change  General. 

The  mere  possession  of  a  certificate  by  the  husband  of  a  member 
who  has  voluntarily  paid  the  assessments  thereon,  is  explainable  by 
the  marital  relations  and  consistent  with  the  rights  of  the  wife  re- 
maining undisturbed  thereb.y;  is  not  sufficient  to  show  a  vested  right 
in  the  husband  nor  to  divest  the  right  of  the  wife  to  change  the 
beneficiary  at  will. 

Preusser  vs.  Supreme  Hive,  Ladies  of  tlie  Maccabees  of  the  World, 
Nov.,  1904,  123  Wis.  164. 

Beneficiaries,  Not  Controlled  by  Will. 

A  provision  in  the  laws  of  a  society  to  the  effect  that  no  will  shall 
be  permitted  to  control  the  distribution  of  or  the  rights  of  any 
person  to  any  benefit  payable  by  the  society,  is  not  contrary  to 
public  policy  and  is  binding  upon  the  member,  precluding  him  from 
disposing  by  will  of  the  proceeds  of  his  benefit  certificate. 

Thomas  vs.  Covert,  Jan.,  1906,   126  Wis.  593. 


1028  FRATERNAL    SOCIETY    LAW 

"Legal  Heirs,"  Who  are  Within  the  Term. 

The  legal  heirs  of  a  deceased  member  of  a  fraternal  society,  to 
whom  by  the  terms  of  his  certificate  payment  is  to  be  made  out  of 
the  widows'  and  orphans'  benefit  fund,  include  all  persons  desig- 
nated as  distributees  by  the  statutes  for  the  distribution  of  the 
property  of  intestates,  and  under  the  statutes  of  this  state  include 
the  widow. 

Thomas  vs.  Covert.  Jan.,  1906,  126  Wis.  593. 
"Saloon  Keeper"  and  "Bartender,"  Who  are. 

One  who  is  not  employed  <u-  jaaid  compensation  as  a  bartender  is 
not  a  saloonkeeper  within  the  prohibition  against  members  engag- 
ing in  the  occupation  known  as  saloon  bartender,  although,  while 
engaged  in  his  duties  as  choreboy  in  a  restaurant  and  saloon,  the 
member  occasionally  waited  upon  customers  as  an  accommodation 
to  his  employer. 

Stevens  vs.  Modern  Woodmen  of  America,  March,  1906,  127  Wis.  606. 

' '  Occupation, ' '  What  is  Meant  by  Term. 

Engaging  in  an  employment  or  occupation  prohibited  by  the  con- 
ditions of  the  contract  in  a  fraternal  society  has  reference  to  the 
vocation  or  calling  to  which  the  insured  devotes  himself  with  some 
degree  of  permanency  for  hire  or  profit,  and  does  not  refer  to  acts 
which  are  simply  incidentally  connected  with  the  regular  employ- 
ment. 

Stevens  vs.  Modern  Woodmen  of  America,  March,  1906.  127  Wis.  606. 

Evidence,  Proofs  of  Death  Admitting  Suicide,  Effect  of. 

Proofs  of  death  furnished  by  a  beneficiary  conlaiiiing  a  state- 
ment by  a  physician  to  the  efi:'ect  that  the  member  suicided,  and 
reference  to  the  findings  of  the  coroner  to  the  same  effect,  are,  in  a 
case  where  suicide  is  under  the  contract  a  defense  to  the  payment  of 
the  certificate,  prima  facie  evidence  of  the  fact  of  snieide. 


THE    STATE   OF    WISCONSIN  1029 

Rohloff  vs.   Aid  Association   for  Lutlierans.  Dec.  190G,   130  Wis.  61. 

Suicide,  Presumptions  Respecting. 

Where  the  question  involved  is  the  suicide  of  the  member,  and 
that  question  is  to  be  submitted  to  the  jury,  any  presumption  of 
suicide  arising  from  the  proofs  of  death  is  not  stronger  than  tlie  gen- 
eral presumption  against  suicide  and  does  not  shift  the  burden  of 
proof. 

Rohloff  vs.  Aid  Association   for  Lutherans.  Dec.  ]90(;,  130  Wis.  61. 

Evidence,  What  Required  to  Change  Written  Statement. 

In  order  to  impeach  a  written  settlement  effected  between  a  so- 
ciety and  a  beneficiary  upon  the  ground  of  fraud  or  mistake,  the 
proof  must  be  clear  and  convincing  beyond  reasonable  controversy. 

Steffen  vs.  Supi'enie  Assembly  of   the   Defenders,   Supreme   Cjurt   of 
Wisconsin,  Jan.,   1907.   110   N.   W.   401. 

Warranty  Must  be  Strongly  Enforced. 

In  his  application  the  member  warranted  that  his  answers  to  the 
questions  therein  were  true,  and  the  certificate  issued  thereon  stated 
that  it  was  issued  in  consideration  of  tlie  application  and  the  war- 
ranties therein  contained.  Prior  to  the  date  of  the  application  the 
members  had  three  attacks  of  inflammatory  rheumatism,  and  in  his 
application  he  stated  that  he  had  suffered  once  with  rheumatism, 
but  without  designating  that  it  was  inflammatory.  The  member's 
death  was  caused  remotely  by  inflamniatory  rheumatism.  Held,  that 
the  certificate  issued  on  the  apjilication  was  void  by  reason  of  the 
breach  of  warranty. 

Loehr  vs.  Supreme  Assembly.  Equitable  Fraternal  Union,   Supreme 
Court  of  Wisconsin,  June,  1907,  112  N.  W.  441. 


1030  FRATERNAL    SOCIETY    LAW 


THE 

STATE  OF  WYOMING. 

CHAPTER  51. 

(The  Section  uumbers  employed  correspond  to  those  in  the  Act  of 
1901.) 

Fraternal  Insurance  Associations — What  Required  to  Constitute. 

Section  64.  A  fraternal  beneficiary  association  is  hereby  declared 
to  be  a  corporation,  society  or  volnntaiy  association,  formed  or  or- 
ganized and  carried  on  for  the  sole  benefit  of  its  members  and  their 
beneficiaries,  and  not  for  profit.  Each  association  shall  have  a  lodge 
system,  with  ritualistic  form  of  work  and  a  representative  form  of 
government,  and  shall  make  provision  for  the  payment  of  benefits  in 
ease  of  death,  and  may  make  pi'ovision  for  the  payment  of  benefits  in 
case  of  sickness,  temporary  or  permanent  physical  disability,  either 
as  the  result  of  disease,  accident  or  old  age,  provided  the  period  in 
life  at  which  payment  of  i)hysical  disability  benefits  on  account  of 
old  age  commences,  shall  not  be  under  seventy  (70)  years,  subject  to 
their  compliance  with  its  constitution  and  laws.  The  fund  from 
which  the  payment  of  such  l)enefits  shall  be  made,  and  the  fund  from 
M'hich  the  expenses  of  such  association  shall  be  defrayed,  shall  be 
derived  from  assessments  oi-  dues  collected  from  its  members.  Pay- 
ment of  death  benefits  shall  be  to  the  families,  heirs,  blood  relatives, 
affianced  husband  or  affianced  wife  of.  or  to  persons  dependent  upon 
the  member,  or  to  the  lodge  in  which  he  holds  membership.  Such 
association  shall  be  governed  b.v  this  act  and  shall  be  exempt  from 
the  provisions  of  the  insurance  laws  of  this  State,  and  no  law  here- 


THE    STATE    OF   WYOMING  1031 

after  passed  slmll  .■ii);)ly  tn  IIhui  unless  they  be  expressly  designated 
therein.  Any  such  fraternal  beneficial  association  may  create, 
maintain,  disburse  and  apply  a  reserve  <h-  I'lncrai'iioy  fund  in  accord- 
ance with  its  constitution  or  by-laws. 

Those  Doing  Business  May  Continue — When. 

Section  65.  All  such  assuciations  coniini;'  within  the  ilcseription 
as  set  forth  in  Section  1  of  this  act,  organi/.ed  under  the  laws  of  this 
or  any  other  State,  province  or  territory,  and  now  doing  business  in 
this  State,  may  continue  sucli  business,  provided  tli.it  they  hereafter 
comply  with  the  provisions  of  this  act  regulating  annual  reports  and 
the  designation  of  the  State  Auditor  and  ex-officio  Insurance  Com- 
missioner as  the  person  upon  whom  process  may  be  served  as  here- 
inafter provided. 

Foreign  Associations  May  Do  Business — When. 

Section  66.  Any  such  association  coming  within  the  description, 
as  set  forth  in  Section  1  of  this  act,  organized  under  the  laws  of  any 
other  State,  province  or  territory,  and  not  now  doing  business  in  this 
State,  shall  be  admitted  to  do  business  within  this  State  when  it 
shall  have  filed  with  the  State  Auditor  and  ex-officio  Insurance  Com- 
missioner a  diily  certified  copy  of  its  charter  and  articles  of  associa- 
tion or  eorjioration  and  a  copy  of  its  constitution  or  laws,  certified 
to  by  its  secretary  or  corresixmding  officer,  an  acceptance  of  the 
constitution  of  this  State,  together  with  an  appointment  of  the  State 
Auditor  and  ex-oflicio  Insurance  Commissioner  of  this  State  as  a  per- 
son upon  whom  process  may  be  served  as  hereinafter  provided ;  and 
provided  that  such  association  shall  be  showai  to  be  authorized  to  do 
business  in  the  State,  province  or  territory  in  which  it  is  incorporated 
or  organized,  in  case  the  laws  of  such  State,  province  or  territory 
shall  provide  for  such  aiTthorization ;  and  in  case  the  laws  of  such 
State,  province  or  territory  do  not  provide  for  any  formal  authoriza- 
tion to  do  biisiness  on  the  part  of  such  association,  then  such  associa- 
tion shall  be  shown  to  be  conducting  its  business  in  accordance  with 
the  provisions  of  this  act,  for  which  purpose  the  State  Auditor  and 
ex-officio  Insiu'anee  Commissioner  of  this  State  may  personally,  or  by 


1032  FRATERNAL    SOCIETY    LAW 

some  person  to  be  designated  by  him,  examine  into  the  condition, 
affairs,  character  and  business  methods,  accounts;  books,  and  invest- 
ments of  such  association  at  its  home  office,  which  examination  shall 
be  at  the  expense  of  such  association,  and  shall  be  made  within 
thirty  days  after  demand  thereof,  and  the  expense  of  such  examina- 
tion shall  be  paid  by  such  association. 

Eeports  Required — What  to  Contain. 

Section  67.  Every  such  association  doing  business  in  this  State 
shall,  on  or  before  the  first  day  of  March  of  each  year,  make  and 
file  with  the  State  Auditor  and  ex-officio  Insurance  Commissioner  of 
this  State  a  report  of  its  affairs  and  operations  during  the  year  end- 
ing on  the  31st  day  of  December,  immediately  preceding,  which  an- 
nual report  shall  be  in  lieii  of  all  other  reports  required  by  any  other 
law.  Such  reports  shall  be  upon  blank  forms  to  be  provided  by  the 
State  Auditor  and  ex-officio  Insurance  Commissioner,  or  may  be 
printed  in  pamphlet  form,  and  shall  be  verified  under  oath  by  the 
duly  authorized  officei's  of  such  association,  and  shall  contain  answers 
to  the  following  questions: 

1.  Number  of  certificates  issued  during  the  year,  or  members  ad- 
mitted. 

2.  Amoimt  of  indemnitj'  effected  thereby. 

3.  Number  of  losses  or  benefit  liabilities  incurred. 

4.  Number  of  losses  or  benefit  liabilities  paid. 

5.  The  amount  received  from  each  assessment  for  the  year. 

6.  Total  amount  paid  members,  beneficiaries,  legal  representatives 
or  heirs. 

7.  Number  and  kind  of  claims  for  which  assessments  liave  been 
made. 

8.  Number  and  kind  of  claims  compromised  or  resisted,  and 
statement  of  reasons. 

9.  Does  association  charge  annual  or  other  periodical  dues  or  ad- 
mission fees? 

10.  How  much  on  each  one  thousand  dollars,  annually  or  per 
capita,  as  the  case  may  be? 

11.  Total  amount  received,  from  what  source,  and  the  disposition 
thereof. 


THE    STATE    OF    WYOMlNd  1033 

12.  Total  amount  of  salai'ies  paid  to  officers. 

13.  Does  association  guarantee,  in  its  cci'tificates,  fixed  amounts 
to  be  paid  regardless  of  amount  realized  from  assessments,  dues,  ad- 
mission fees  and  donations? 

1-4.  If  so,  state  amount  guaranteed,  and  the  security  of  such  guar- 
anty. 

15.  Has  the  association  a  reserve  fund? 

16.  If  so,  how  is  it  created,  and  for  what  purpose,  the  amount 
thereof,  and  how  invested? 

17.  Has  the  association  more  than  one  class? 

IS.     If  so,  how  many,  and  the  amount  of  indemnity  in  each  ? 

19.  Number  of  members  in  each  class. 

20.  If  voluntary,  so  state,  and  give  date  of  organization. 

21.  If  organized  under  the  laws  of  this  State,  under  what  law 
and  at  what  time;  giving  chapter  and  year  and  date  of  the  passage 
of  the  act. 

22.  If  organized  uuder  the  laws  of  any  other  State,  province  or 
territory,  state  such  fact  and  the  date  of  organization,  giving  chapter 
and  date  of  passage  of  the  act. 

23.  Number  of  certificates  of  beneficiary  membership  lapsed  dur- 
ing the  year. 

24.  Number  in  force  at  beginning  and  end  of  year;  if  more  than 
one  class,  number  in  each  class. 

25.  Names  and  addresses  of  its  president,  secretary  and  treas- 
urer, or  corresponding  officers. 

The  State  Auditor  and  ex-officio  Insurance  Commissioner  is  auth- 
orized and  empowered  to  address  any  additional  inquiries  to  any 
such  association  in  relation  to  its  doings  or  condition,  or  any  other 
matter  connected  with  its  transaction  relative  to  the  business  con- 
templated by  this  act,  .and  such  officers  of  such  association  as  the 
State  Auditor  and  ex-officio  Insurance  Commissioner  may  require 
shall  promptly  reply  in  writing,  under  oath,  to  all  such  inquiries. 

Agent  to  be  Appointed — Civil  Process  Upon. 

Section  68.  Each  such  association  now  doing  or  hereafter  ad- 
mitted to  do  business  ■within  this  State,  and  not  having  its  principal 
office  within  this  State  and  not  being  organized  under  the  laws  of 


1034  FRATERNAL    SOCIETY    LAW 

this  State,  shall  appoint,  in  writing,  the  State  Auditor  and  ex-officio 
Insurance  Commissioner  and  his  successors  in  office  to  be  its  true 
and  lawful  attorney,  upon  whom  all  lawful  process  in  any  action  or 
proceeding  against  it  must  be  served,  and  in  such  M-ritinp:  shall  agree 
that  any  lawful  process  against  it,  which  is  served  on  said  attorne.y, 
shall  be  of  the  same  legal  force  and  validity  as  if  served  upon  the 
association,  and  that  the  authority  shall  continue  in  force  so  long 
as  any  liability  remains  outstanding  in  this  State.  Copies  of  such 
certificate,  certified  by  said  State  Auditor  and  ex-officio  Insurance 
Commissioner,  shall  be  deemed  sufficient  evidence  thereof,  and  shall 
be  admitted  in  evidence  with  the  same  force  and  effect  as  the  original 
thereof  might  be  admitted.  Service  upon  such  attorne.y  shall  be 
deemed  sufficient  service  upon  such  association.  When  legal  process 
against  any  such  association  is  served  upon  said  State  Auditor  and 
ex-officio  Insurance  Commissioner,  he  shall  immediately  notify  the 
association  of  such  service  by  registered  letter,  prepaid  and  directed 
to  its  secretary  or  corresponding  officer,  and  shall  within  two  days 
after  such  service  forward  in  the  same  manner  a  copy  of  the  process 
served  on  him  to  such  officer.  The  State  Auditor  and  ex-officio  In- 
surance Commissioner  shall  keep  a  record  of  all  processes  served 
upon  him,  which  record  shall  show  the  day  and  hour  when  such 
service  was  made. 

Permit  to  do  Business — Fees  for. 

Section  69.  The  State  Auditor  and  ex-officio  Insurance  Commis- 
sioner of  this  State  shall,  upon  the  application  of  any  association  hav- 
ing the  right  to  do  business  within  this  State,  as  provided«by  this  act, 
issue  to  such  association  a  permit  in  Avriting,  authorizing  such  asso- 
ciation to  do  business  within  this  State.  For  the  first  certificate  and 
all  proceedings  in  connection  therewith,  such  association  shall  pay 
to  the  State  Auditor  and  ex-officio  Insurance  Commissioner  the  fee 
of  $15.00;  and  upon  the  filing  of  each  additional  animal  report  such 
association  shall  pay  to  the  State  Auditor  and  ex-officio  Insurance 
Commissioner  a  fee  of  $10.00;  and  all  fees  received  by  said  State 
Auditor  and  ex-officio  Insurance  Commissioner  shall  be  paid  to  the 
State  Treasurer,  for  the  benefit  of  the  general  fund  of  the  State,  the 


THE    STATE    OF    WYOMING  1036 

State  Treasurer  issuing  his  recpii)t  in  ti'iplieate  therofor  ;is  now  pro- 
vided by  law. 

Benefit  Exempt  from  Execution  or  Attachment. 

Section  70.  The  money  or  other  benefit,  charity,  relief  or  aid  to 
be  paid,  provided  or  rendered  by  an  association  authorized  to  do 
business  under  this  act,  shall  not  bo  liable  to  attachment  by  trustee, 
garnishee  or  other  process,  and  shall  not  be  seized,  taken,  appro- 
priated or  ajiplied  by  any  legal  or  equitable  process,  or  by  operation 
of  law,  to  pay  any  debt  or  liability  of  a  certificate  holder  or  of  any 
beneficiary  named  in  a  certificate,  or  any  person  wlio  may  have  any 
right  thereunder. 

Meetings  May  Be  Held  Anywhere. 

Section  71.  Any  such  association,  oi'ganized  under  the  laws  of  this 
State,  may  i)rovide  for  the  meetings  of  its  legislative  or  governing 
body  in  any  other  State,  province  or  territory,  wherein  su(?h  associa- 
tion shall  have  subordinate  bodies,  and  all  business  transacted  at 
such  meetings  shall  be  valid  in  all  respects,  as  if  such  meetings  were 
held  within  this  State,  and  when  the  laws  of  any  such  association 
provide  for  the  election  of  its  officers  by  votes  to  be  cast  in  its  sub- 
ordinate bodies,  the  votes  so  cast  in  its  subordinates  in  any  other 
State,  jirovince  or  territory,  shall  be  valid  as  if  cast  within  this  State. 

Penalties. 

Section  72.  Any  person,  officer,  membei'  or  examining  physician 
who  shall  knowingly  or  willfully  make  any  false  or  fraudulent  state- 
ment or  representation  for  membership,  or  for  the  purpose  of  obtain- 
ing any  money  or  benefit  in  any  association  transacting  business 
under  this  act,  shall  be  guilty  of  a  misdemeanor,  and  upon  conviction 
shall  be  punished  by  a  fine  of  not  less  than  $100  nor  more  than  $500, 
or  by  imprisonment  in  the  county  jail  for  not  less  than  thirty  days 
nor  more  than  one  year,  or  both  such  fine  and  imprisonment,  in  the 
discretion  of  the  court;  and  any  person  who  shall  willfully  make  a 
false  statement  of  any  material  fact  or  thing  in  a  sworn  statement 


1036  FRATERNAL    SOCIETY    LAW 

as  to  the  death  or  disaliility  of  a  certificate  holder  in  any  such  asso- 
ciation for  the  purpose  of  procuring  paj'ment  of  a  benefit  named  in 
the  certificate  of  such  holder,  and  any  person  who  shall  willfully 
make  any  false  statement  in  any  verified  report  or  declaration  under 
oath  required  or  authorized  by  this  act,  shall  be  guilty  of  perjury, 
and  shall  be  proceeded  against  and  punished  as  provided  by  the 
statutes  of  this  State  in  relation  to  the  crime  of  perjury. 

Failing  to  Make  Report — Penalty. 

Section  73.  Any  such  association  refusing  or  neglecting  to  make 
the  report  as  provided  in  this  act.  shall  be  excluded  from  doing  busi- 
ness within  this  State.  Said  State  Auditor  and  ex-officio  Insurance 
Commissioner,  within  sixty  days  after  failure  to  make  such  report, 
or  in  case  any  such  association  shall  exceed  its  powers  or  shall  con- 
duct its  business  fraudulently,  or  fail  to  comply  with  anj'  of  the 
provisions  of  this  act,  give  notice  in  writing  to  the  Attorney  General, 
who  shall  immediately  commence  an  action  against  any  such  associa- 
tion to  enjoin  the  same  from  carrying  on  any  business.  And  no  in- 
junction against  anj^  such  association  shall  be  granted  by  any  court, 
except  on  application  by  the  Attorney  General,  at  the  request  of  the 
State  Auditor  and  ex-officio  Insurance  Commissioner,  whether  the 
State  or  a  member  or  other  party  seeks  relief.  Xo  association  so  en- 
joined shall  have  authority  to  continue  business  until  such  report 
shall  be  made,  m-  overt  act  or  violations  complained  of  shall  have 
been  corrected,  nor  until  the  costs  of  such  action  be  paid  by  it.  pro- 
vided the  court  shall  find  that  such  association  was  in  default  as 
charged,  whereupon  the  State  Auditor  and  ex-officio  Insurance  Com- 
missioner shall  reinstate  such  association,  and  not  until  then  shall 
such  association  be  allowed  to  again  do  business  in  this  State.  Any 
officer,  agent  or  person  acting  for  any  association  or  subordinate 
body  thereof,  within  this  State,  while  such  association  shall  be  so  en- 
joined or  i)i'ohihited  from  doing  business  pursiwint  \n  this  act.  shall 
be  deemed  guilty  of  a  misdemeanor,  and  on  conviction  thei-eof  shall 
be  puni.shed  by  a  fine  of  not  less  than  $2.5.00  nor  more  than  .$200.00, 
or  by  imprisonment  in  the  county  jail  for  not  less  than  thirty  days 
nor  more  than  one  yp-<\\\  nr  by  Itoth  such  fine  and  ini|)risoniiiciit.  in 
the  discrelioii  of  llic  ciMirt. 


THE    STATJ-;    OF    WYOMING  1037 

Officer  Acting  Without  Authority — Penalty. 

Section  74.  Any  person  wlio  shall  act  within  this  State  as  an 
agent,  officer,  or  otherwise,  for  any  association,  which  shall  have 
failed,  neglected  or  refused  to  comply  with,  or  shall  have  violated 
any  of  the  provisions  of  this  act,  or  shall  have  failed  or  neglected 
to  procure  from  the  State  Auditor  and  ex-officio  Insurance  Commis- 
sioner, a  proper  certificate  of  authority  to  transact  business,  as  pro- 
vided for  by  this  act,  shall  be  subject  to  the  penalty  provided  in  the 
last  preceding  section  for  the  misdemeanor  therein  specified. 

Orders  not  Affected  by  This  Act. 

Section  75.  This  act  shall  not  apply  to  or  aft'eet  grand  or  sub- 
ordinate lodges  of  Masons.  Odd  Fellows  or  similar  orders  paying 
only  sick  disability  or  funeral  benefits,  or  any  association  not  work- 
ing on  the  lodge  system  which  limits  its  certificate  holders  or  mem- 
bership to  a  particular  class,  or  to  the  employes  of  a  particular  town 
or  city,  designated  fii-ni.  business  house  or  corporation. 

Contract — Oral  Agreement  of  Insurance  Valid. 

An  oral  contract  for  insurance  may  be  valid,  and  if  completed  by 
a  meeting  of  the  minds  of  the  parties,  the  insurer  will  be  liable  for 
loss  occurring  before  the  issuance  and  delivery  of  the  contract. 

Summers   vs.   Mutual  Life  Ins.  Co.,  March,   1904,   12  Wyo.,   369;    75 
Pac.  937. 

Precedent  Condition  of  Liability  the  Delivery  of  Contract,  Valid. 

It  is  not  luiusual  for  life  contracts  to  provide  they  shall  not  take 
effect  until  after  delivery  of  the  contract,  and  in  such  cases  it  is 
reasonable  to  hold  that  no  risk  is  assumed  until  such  delivery. 

Summers  vs.   Mutual   Life   Ins.  Co.,  March,   1904.   12  Wyo.,   369;    75- 
Pac.  937. 

Payment — Recovery  of  Amount  Paid  Under  Void  Contract. 

Where  a  company  delivers  a  policy  difl^erent  from  that  contracted 


1038  FRATERNAL    SOCIETY    LAW 

for,  the  applicant  may  refuse  to  accept  it  and  sue  to  recover  the 
premiums  paid;  and  when  a  contract  is  void  ab  initio,  or  where 
the  risk  never  attached,  the  premium  paid  may  be  recovered  back 
as  money  had  and  received. 

Summers   vs.   Mutual   Life   Ins.   Co.,   March,   1904,   12  Wyo..    369;    75 
Pac.  937. 

Conditions  Precedent  to  Liability  Proper. 

A  life  insurance  company  has  the  absolute  right  to  insist  that  it 
shall  accept  an  application  and  issue  a  contract  before  it  shall  be 
bound  as  an  insurer,  and  there  can  be  no  doubt  of  the  right  of  one 
desiring  or  applying  for  insurance  to  require  a  delivery  to  him 
and  acceptance  by  him  of  the  contract  before  he  will  be  bound 
thereby. 

Summers   vs.   Mutual  Life  Ins.  Co.,  March,   1904,   12  Wye,   369;   75 
Pac.  937. 


FRATERNAL    SOCIETY    LITERATURE  1039 


FEATERNAL  SOCIETY  LITERATUEE. 


CHAPTER  52. 

The  ainouiit  ol'  scieiititic  jitRl  technical  literature  dealing  with  the 
Fraternal  Society  is  reiiiarkal)ly  small. — Much  of  what  there  is  has 
been  inaccessable  to  the  jiublic.  The  following  presents  a  list  of  the 
more  important  books  and  pajiers  published  upon  subjects  of  Fra- 
ternal Society  Law.  Usually  copies  can  be  found  in  the  law  libraries 
but  where  this  is  not  possible  they  can  be  obtained  from  the  pub- 
lishers : 
Analyses  of  Fraternal  Societies.    1  Volume. 

Abb  Landis,  Author  and  Publisher,  Nashville,  Tenn. 
Benefit  Societies  and  Life  Insurance.    2  Volumes. 

Frederick  II.  Bacon,  Author,  St.  Louis,  Mo, 
Benefit  Societies  and  Accident  Insurance.     1  Volume. 

Wm.  C.  Niblaek,  Author,  Chicago,  111. 
Bests  Life  Insurance  Reports.     1  Volume  Annually. 

Best  Ileportinu'  (.'o..  New  York,  N.  Y. 
Beneficiaries  and  the  Payment  of  Death  Claims.    Paper. 

G.  A.  Harper,  Ind.,  Order  of  Foresters,  Toronto,  Can. 
Briefs  on  Law  of  Insurance.    5  Volumes. 

R.  W.  Cooley,  Author,  West  Pub.  Co.,  St,  Paul,  Minn, 
Cyclopaedia  of  Fraternities,    1  Volume. 

Albert  C,   Stevens.  Author.     E.  B.   Treat  &   Co.,   Publishers, 
New  York, 
Friendly  Societies  and  Fraternal  Orders.     1  Volume. 

Abb  Landis,  Author  and  Publisher,  Nashville,  Tenn, 
Facts  for  Fraternalists.    1  Volume. 

The  Fi'aternal  Monitor,  Pul)lishers,  Rochester,  N.  Y. 
Friendly  Society  Movement.     I  Volume. 


1040  FRATERNAL    SOCIETY   LAW 

J.  F.  Wilkinson,   Author,  D.  C.Lent,  Agent,  30  Park  PI., 
New  York. 
Fraternal  Societies — Statistics.    1  Volnme. 

The  Fraternal  Monitor,  Publishers.  Rochester,  N.  T. 
Insurance  Year  Book.    1  Volume  Annually. 

The  Spectator  Co.,  Publishers,  New  York. 
Insurance  Digest.    20  Volumes. 

Rough  Notes  Pub.  Co.,  Indianapolis,  Ind. 
Law  of  Fraternal  Insurance.    1  Volume. 

A  collection  of  most  valuable  Papers  read  before  meetings  of 
the  Law  Section,  of  the  National  Fraternal  Congress.  Carlos 
S.  Hardy,  Editor,  Chicago,  111. 
Life  Insurance  Premiums.    1  Volume. 

Abb  Landis.  Author  and  Publisher,  Nashville,  Tenn. 
Life  Insurance,  the  Business  of.    1  Volume. 

Miles    M.    Dawson,    Author.      A.    S.    Bai-nes    &    Co.,    Pubs., 
New  York. 
Proceedings  of  the  National  Fraternal  Congress.     1886  to  1907.     1 
Volume  Annually  since  1900. 

C.  A.  Gower.  Sec'v-Treas.,  Lansing,  Mich. 


1041 


LIST  OF  LAWYERS. 

CHAPTER  53. 

The  Fraternal  Society  manager  or  General  Coiinsel  has  no  more 
perplexing  and  difficult  ivroblein  presented  to  him  from  day  to  day 
than  the  selection  of  capable  and  dependable  lawyers  who  are  experi- 
enced in  Fraternal  Society  law  to  whom  may  be  entrusted  the 
investigation  of  death  claims,  collecting  of  evidence  and  defense  and 
prosecution  of  the  rights  of  the  societies  in  litigated  matters.  The 
practice  of  Fraternal  Society  law  is  the  practice  of  a  specialty  and 
there  are  but  few  lawyers  in  any  State  at  all  experienced  therein. 
Through  the  interchange  of  experiences  and  cooperation  the  General 
Counsel  of  the  Fraternal  Societies  have  come  to  recognize  those 
members  of  the  bar  in  each  locality  who  are  of  the  class  referred  to 
above.  It  is  believed  that  the  inclusion  of  a  list  of  such  members 
of  the  legal  profession  as  are  entirely  reliable  and  capable  of  han- 
dling satisfactorily  any  business  entrusted  to  them  by  Fraternal  So- 
cieties and  who  now  and  for  some  years  have  enjoyed  a  large  practice 
in  Fraternal  matters  in  a  work  of  the  character  of  Fraternal  Society 
Law  will  not  detract  from  the  merit  of  the  work  but  add  to  its  use- 
fulness and  be  appreciated  by  all  having  occasion  to  use  it. 

The  following  list  contains  the  names  and  address  of  those  mem- 
bers of  the  bar  in  their  several  states  whom  the  author  knows  to  be 
entirely  trustworthy,  reliable,  and  of  large  practice,  but  who  will 
give  special  attention  to  Fraternal  Society  Law  and  who  have  such 
experience  and  ability  in  Fraternal  Society  matters  as  to  merit  the 
full  confidence  of  all  who  may  engage  their  services.  The  attorneys 
listed  will  attend  to  matters  in  any  part  of  their  respective  states 
and  in  any  court  therein  : 

66 


1042 


FRATERNAL    SOCIETY    LAW 


I 


ARKANSAS. 

Little  Rock.        Bradshaw.  Rhoton  &  Helm. 
Kahn  Building. 
See  Card  on  page  1149. 
Russelville.         U.  L.  Meade. 

Of  firm   of  Meade   &  Davis. 
See  Card  on  page  1149. 

CALIFORNIA. 

San  Francisco.    Henry  C.  Scliaertzer. 

Humboldt  Bank  Bldg. 
See  Card  on  page  1149. 

COLORADO. 

Denver.  Allen  &  Webster. 

General  Counsel  for  Supreme  Lodge  Fraternal  Union 
of  America.     Cooper  Building. 

See  Card  on  page  1149. 

CONNECTICUT. 

New  Haven.       Ailing,  Webb  &  Morehouse. 
First  National  Bank  Bldg. 
See  Card  on  page  1150. 

GEORGIA. 

Savannah.  Jacob  Gazan. 

Provident  Building. 
See  Card  on  page  1150. 

ILLINOIS. 

Carthage.  Wm.  B.  Risse. 

General  Attorney  for  Court  of  Honor. 

See  Card  on  page  1150. 

Chicago.  Edmund  S.  Cummings. 

General   Attorney   for    Catholic    Order   of   Foresters. 

Ashland  Block. 

Carlos  S.  Hardy. 

General    Counsel    for    Supreme    Lodge    Knights    of 
Pythias.  Ins.  Dept.     Manhattan  Bldg. 

See  Cardon  page  1151. 

Charles  J.  Kavanagh. 

Tacoma  Bldg. 

George  W.  Miller. 

General   .•\ttorney  for  Royal  League. 

Ashland  Block. 


LIST    OF    LAWYERS 


104;^, 


Dnnvillc.  Dwycr  &  Dwycr. 

Commercial  Bank  Bldg. 
See  Card  on  page  1150. 

IOWA. 

Dubuque.  Nelson,  Duffy  &  Dciiison. 

Security  Bldg. 
See  Cardon  page  1151. 

INDIANA. 

Evansville.  Charles  L.  Wedding. 

314  Main  St. 
See  Cardon  page  1151. 

ludiaunpolis.       C.  S.  &  G.  L.  Denny. 

Indiana  Pythian  Bldg. 
See  Cardon  page  1151. 

KANSAS. 

Tojieka.  George  A.  Huron. 

Office  Block. 
General  Attorney  for  Knights  and  Ladies  of  Security. 

See  Card  on  page  1152. 

KENTUCKY. 

Louisville.  Carutli,  Cliatterson  &  lilitz. 

See  Card  on  page  1152. 
Newport.  L.  J.  Crawford. 

See  Card  on  page  1152. 
Padueah  Bagby  &  Martin. 

See  Card  on  page  1152. 

MASSACHUSETTS. 

Boston.  Joseph  C.  Pelletier. 

National     Advocate     for     Knights     of     Columbus. 
18  Tremont  St. 

See  Card  on  page  1152. 
Springfield  Charles  L.  Young. 

397  Main  st. 
See  Card  on  page  115.3. 

MICHIGAN. 

Detroit.  Hal.  H.  Smith. 

Penobscot  Bldg. 
See  Card  on  page  1153. 


1044 


FRATERNAL   SOCIETY   LAW 


MINNESOTA. 
Fergus  Falls.     C.  L.  Ililloii. 

First  National  Bank  Bldg. 
See  Card  on  page  1153. 
Mankato.  Benj.  D.  Smith. 

General  Attorney  tor  ilodern  Woodmen  of  America. 
Minneapolis.       Charles  G.  Lavboitrn. 

New  York  Life  Bldg. 
See  Card  on  page  11.5.J. 

MISSISSIPPI. 
Jackson.  ]\Ic"\Villie  &  Tliompson. 

McWillie  and  Thompson  Bldg. 
See  Card  on  page  1153. 
Vicksburg.  Smith,  Hirsh  &  Landau. 

See  Card  on  pase  ll.'i4. 

MISSOURI. 

St.  Louis.  R.  P.  Williams. 

Of  R.  P.  and  C.  B.  Williams.    Third  Nat'l  Bank  Bldg. 
See  Card  on  page  1154. 

NEBRASKA. 

Omaha.  A.  H.  Burnett. 

General  Attorney  for  Sovereign  Camp,  Woodmen  of 
the  World.     Woodmen  of  the  World  Bldg. 

See  Card  on  page  1154. 

NEW  YORK. 
Buffalo.  Duekwitz.  Tliayer  &  Tuttle. 

D.  S.  Morgan  Bldg. 
See  Card  on  page  1154. 

New  York.         James  C.  De  La  Mare. 

Of  De  La  Mare  and  Morrison.     299  Broadway. 

See  Card  on  page  1155. 

Bayard  P.  Holmes. 

Of  Hooper  and  Holmes  Information  Bureau,  Inspec- 
tion    of     Risks,     Investigations     of     Claims,     etc. 

37  Nassau  St. 

See  Card  on  page  1135. 

NORTH  CAROLINA. 
Greensboro.         Robt.  C.  Strudwiek. 

See  Card  on  page  1155. 


LIHT    OF    LA  wvf.hh  1045 

NORTH  DAKOTA. 

Gnind  Forks.     Geo.  A.  Baug.s. 

See  Card  on  page  1155. 

OHIO. 

Akron.  George  W.  Sii'bcr. 

Of  Grant,  Sieber  and  Mather.     Dobson  Bldg. 

See  Card  on  page  ll.^C. 

CiiK'iimuti.  Howjircl  Ddiighiss. 

Dickson  Bldg. 

See  Card  on  ))age  1156. 

Cleveland.  II.  W.  Ewing. 

Of   Ewiug,    Nieding   and   Kramer.     American    Trust 
Bldg. 

See  Card  on  page  1150. 

OKLAHOMA. 
Guthrie.  F.  C.  Hunt. 

Billingsley  Bldg. 
See  Card  on  page  1156. 

PENNSYLVANIA. 
Sharon.  J.  A.  McLaughry. 

General   Attorney  for  Protected  Home  Circle. 

TENNESSEE. 

Chattanooga.      Thomas  &  Thomas. 

Temple  Court. 

See  Card  on  page  1157. 

Kingslnn.  W.  H.  Dietz. 

See  Card  on  page  1156. 

Meinpliis.  Brown  &  Anderson. 

Memphis  Trust  Bldg. 

See  Card  on  page  115". 

F.  Zimmerniann. 

General   Attorney   for   Supreme   Hive   Ladies   of   the 
Maccabees  of  the  World.    Tennessee  Trust  Bldg. 

See  Card  on  page  1157. 

TEXAS. 

Clehiirne.  Ilciiry  P.  Brown. 

Of  Brown  and  Lomax. 
See  Card  on  page  lloS. 
Galveston.  Kleberg-  &  Neethe. 

Levy  Bldg. 
See  Card  on  page  1157. 


1046 


FRATERNAL    SOCIETY    LAW 


San  Ajitonio.      Onidn  &  Henry. 

Kampmann  Bldg. 
See  Card  on  page  1158. 

SOUTH  CAROLINA. 

Charleston.  M.  Rntledge  Rivers. 

Of  Burke,  Rivers  and  Erckmann. 
See  Card  on  page  1158. 

SOUTH  DAKOTA. 

Sioux  Falls.        I'.  S.  G.  Clierry. 

See  Card  on  page  1159. 


INDEX  1Q47 


INDEX. 


(References   are  to   pa^es.) 
ABSENCE: 

Seven  years;   what  must  be  proven   (<ja.),  li:j. 
.    Disappearance  of  member    (Ga.),  113. 

Death,  presumption  of,  from  seven  years'  absence   (111.),  170. 

Death,  presumption   of,  from  absence   (Kas.),  31.3. 

Disappearance;   presumptions;   absence  for  seven  years   (Kas.),  314. 

Disappearance;    delay   in  furnishing  proofs  of  deatli    (Kas.),  323. 

Death,  presumption  of,  from  absence  of  seven  years;   fugitive   (Ky.),  336. 

Death,  when  presumed  from   absence   (Mo.),  600. 

Death,  when  presumed  from  absence  of  seven  years  (Mo.),  600. 

Disappearance   for   seven  years    (Mo.),   COO. 

Death  presumed  from  absence;   compromise  of  claim  valid  though   member 
be    living    (X.    Y.).    728. 
ACCIDENT: 

Accidental   death,   when  presumed    (La.).  364. 

Accident   insurance    (Mass.),  445. 

Accidental    poisoning;    suicide    (Jlich.),   4S0. 
ACCORD: 

And  satisfaction   (Ul.K  163. 

Ajid  satisfaction;  compromises  (Mass.).  43!). 

And  satisfaction    (N.   Y.),    722. 

And   satisfaction    (Vt.).  959. 

See  Compromises. 
ACCOUNTING: 

^Mfiiilpcr   cannot   bring   ^uit   for    (X.   Y.),   731. 
ACQUIESCENCE: 

By   member  in  ruling  of   society    (ilich.),  483. 

Of  member  in  suspension    (Mo.),  591. 
ACTION  AT  LAW: 

Suit  by  wrong  name  (Colo.),  59. 

See   Suit. 
ADMINISTRATOR: 

Suit  by.  on  certificate:  when  proper   (Vt.).  900. 
ADMISSIONS: 

Of  member   binds   beneficiaries    (Ga.),    114. 

Of  member  not  to  defeat  claim  of  beneficiary  (Ind.).  243. 

Of  member  not  admissible  against  Ijcneficiar}-   (Ind.),  232. 


1018  FRATERNAL   SOCIETY   LAW 

ADMISSIONS— Continued: 

Of  beneficiary  in  proofs  of  death  (Kas.),  327. 

Of  member,  as  evidence   (Neb.),  648. 

Of  members   (N.  D.),  772. 
ADOPTION: 

Of  constitution  illegally  (D.  C),  98. 

Adopted  child  is  a  dependent  (111.),  16.5. 

Adopted  child  as  sucli   (Me.i.  388. 
ADVANCE  PAYMENTS: 

To  be  applied,  when   (la.),  277. 

Forfeiture  for  failing  to  pay   lilinn.i.  o'.ii. 

Application  of  (N.  D.),  769. 

Application  of   (Wash.),  993. 
AFTER-ENACTED    LAWS: 

Are   valid  it   within  charter  powers  of  association  and  not  contrary  to  laws 
of  the  State  (Ala),  7-8. 

Are  valid   (Ala.),  10-11. 

Incontestability   clause   changed  by    (Ala.),   8. 

Governing  suicide,  valid  (Ala.),  7-S. 

Ultra  vires  contracts   (Cal.),  48. 

Wlien  valid    (Ca!.),  48. 

As  to  sick  benefits   (Cal.),  43. 

When   valid    (Cal.),   33. 

Change   of   beneficiary    (Cal.),    34. 

Cannot  reduce  aniovuit  of  certificate   iCa.).  111. 

Effect  of    (Cal.),  40. 

Change  from  post  mortem  to  advan -c  assessment  plan  valid   (Colo.),  55. 

Are  valid  (Colo.),  54. 

Ai-e  valid   (Conn.),  70. 

As  to  rights  of  beneficiary  (Conn.),  71. 

Respecting   beneficiaries    (Del.),  83-84. 

Prospective  in  operation  unless  otherwise  expressed    (D.  C),  97. 

Effect  of   (Ga.),   114. 

Cannot   reduce   amount    of   certificate    (Ga.).    111. 

How  far  binding   (Ga.),   109-110. 

Suicide,  sane  or  insane   (Ga.).  112. 

Suicide  laws   are   reasonable    (111.),   164. 

Suicide  laws  valid   (111.).  163-164. 

State  laws;   what  do  not  afi'cct  existing  contracts   (111.),  161. 

When  valid   (111.),  197. 

What  are  reasonable  and  binding   (111.),  194. 

Valid  though  not  adopted  in  formal  way  (111.),  193. 

Reasonable  increase  of  rates   (111.).  193. 

Valid  as  to  extension  of  class  of  beneficiaries   (111.).   190. 

Society  has  jiower  to  amend  laws,  when  (111.),  193. 

Saloon   laws,   valid    (111.).   189. 

When  retroactive  (111.).  189. 

Impairment   of   contracts    (III.).   187. 


I 


INDEX  2049 

AFTER-ENACTED  LAWS— Continued: 

Enlarging   class   of   beneficiaries    (111.),    1S4. 

Valid  as  to  existing  contracts    (111.),  100. 

Reserve  power   (la.),  294. 

Void  amendments  (la.),  282. 

When  void   (la.),  283. 

Eflject  of  (Iowa),  280. 

Change  of  plans,  creation  of  classes   (Ind.),  245-247. 

Are   binding;    incontestable  contracts  amended    (Ind.),  248-250. 

Changing  incontestable  clause   (Ind.),  255. 

In  mutual  society    (Kas.),  327. 

Time   to   sue    (Kas.),  321. 

Prohibited   occupations    (Kas.),   313. 

After  death  of  member;   eflfect  of   (Ky.i.  337-33S. 

State  statutes   (Ky.),  337-338. 

Reduction   of   benefits    (La.),   303. 

As  to  suicide    (La.),  365-300. 

Aie   binding    (La.),    300. 

Limitations  regarding  bringing  suit    (JIass.),   439. 

Raising  of  rates   (Mass.),  441-442. 

Pioviding  for  emergency    (Mass.),  441-442. 

Duty  of  society  to  perpetuate  itself   (ilass.),  443. 

Society  has  right  to  make  necessary  changes  in   (ilass.),  443. 

Breach  of  contract  (Mass.),  447. 

Cannot   arbitrarily  reduce   amount  of   certificate    (Mass.),  447. 

Creating  new  classes   (Mass.),  447-448. 

Reduction  of  benefits    (Mass.  I,  440. 

State  laws,  effect  of   (Mich.).  478. 

Assent  of  members  to   (Mich.),  485. 

Are  binding   (Mich.),  468. 

By  boards  of  directors  (Minn.),  .529. 

!Must  be  reasonable  (Minn.),  531. 

Respecting  resort  to  courts    (Minn.).  517. 

Unreasonable  provisions  of    (!Minn.).  518. 

As  to  occupations  unreasonable    (Minn.).  525. 

Binding,  though  not  adopted  in  regular  mode  (Miss.).  .5.56. 

Suicide  by-law  valid  (Jliss.),  557. 

Are   binding    (Miss.),    551. 

Members  receive  benefits  of    (Miss.),  552. 

Members  receive  benefits  of  and  are  bound  by  (!Miss.).  .553. 

When  they  may  reduce  amount  of  b->nefici;uy's  claim    (^In.l.  608. 

When   valid    (Mo.),   60S. 

Effect  of   (Mo.),  579. 

Affecting  amount  of  benefit,  when  valid    (jMo.),  586; 

Valid  when  within  terms  of  agreement   (5Io.).  586. 

How  far  binding    (Mo.).  586. 

Suicide  law  not  binding  (Mo.).  586-587. 

Conflict  between  State  courts  CMo.).  5S7 : 


r 


1050  FRATERNAL    SOCIETY   LAW 

AFTER-ENACTED  LAWS— Continued: 

How  far  binding   (Mo.),  594. 

Valid  and  aftVct  existing  contracts    (Mo.).  395-596. 

When  not  Ijinding  (Mo.),  59fl. 

To  what  extent  valid   (ilo. ),  597. 

Aj-e  valid  (Neb.),  046. 

Collateral  attack  of   (Xeb.),  645. 

Suicide  laws    (Neb.),  645. 

As   to  representative  government    (Xeb. ).  049. 

When   binding    (Neb.),   055. 

Binding:   no  vested  rights    (X.   H.  i,  09(1. 

Liijuor    law   valid    (N.   J.),   690. 

Suicide   law    (N.    J.),   091. 

Cutting  down  benefit  (N.  J.),  692-693. 

Must  be  reasonable  (N.  J.),  693. 

How   far  binding  on  contracts  outstanding    (X.   \'.),  716. 

^^"hen  violation  of  after-enacted  occupation  law  will  not  void  contract   (N. 

Y.).  717. 
When  not  valid  (N.  Y.),  717. 
Suicide  laws  not  valid  (N.  Y'.),  718. 
When  not   valid   (N.  Y.),  719. 
When  valid  (X.  Y'.),  723. 
Reducing  benefit,  void  (N.  Y".),  724. 
When  valid;   effect  of   (N.  Y.),  724. 
Suicide  laws  void  (N.  Y.),  724. 
Suicide  law  not  valid   (X.  Y.),  725. 
AVill  not  be  permitted  to  destroy  contract  (X.  C),  747. 
When   valid   (X.  C),  748. 
When  not  valid  (X.  C),  748. 
When  not  valid  (X.  C),  751. 
When  valid  (N.  C),  751. 
Suicide  law  valid    (Ohio).   791. 
Suicide  law  valid    (Pa.),   842. 
Bind  insane  member    (Tenn.l.  900. 
Increasing  rates    (Tenn.),   901. 
Are  valid   (Tenn.).  902. 
Reducing  benefit  ultra  vires    (Teiui.),  90S. 
Are  valid   (Tenn.),  909. 
Are  strictly  construed   (Tex.),  925. 
Are  valid  (Tex.).  929. 
Effect  of,  on  beneficiaries    (Tex.).  930. 
Must  be  published   (Tex.),  938. 
Effect  of   agreement  to  be   bound   by    (Tex.),  9.'?8. 
When  amounting  to  repudiation,  void   (Tex.),  939. 
Cannot   reduce   amount   of  certificates    (Tex.).  041. 
Are  valid   (Va.),  977. 
Reasonable  and  valid   (Wis.),  1018. 
AVlipn  valid   (Wis.).  1019. 


I 


I 


INDEX  1051 

AFTER-ENACTED  LAWS— Continued: 

Valid;  iiroliibtcd  (ic'ciipiilions   (Wis.),   1023. 

How  fill-  lawful   (Wis.).   1024. 

See  Amendments. 
Readjustment. 
AGE: 

■  Uf  applicants  (111.),  171. 

No   estoppel  under  ultra   vires  contra<t    (111.).   Kill. 

Warranty   as   to    (Iowa),  21)0. 

Error   in   stating    (Ind.),   250. 

Warranty  as  to   (Mp.),  ;«9. 

Misrepresentation  , as    to;    ouHiprdinise    (Jld.),   4()S. 

Misrepresentation   as   t<i;    payments   rorl'cited    (Minn,),  521. 

Warranty  as  to  (Minn.),  521. 

Misrepresentation  as  to;  waiver  of  laws  (Minn.),  53:3. 

Statements    as    to.    in    previous    applications    to    other    societies    admissible 
(]\linn.),  510. 

Statements   of   member.s   as   to,   competent   to   pru\c    true    af^e    (ilinn.).   ."iK). 

Restrictions  as  to    (Neb.),  639. 

Warranty  and  evidence  respecting   (I'a.),  844. 

Warranty  respecting  must  be  kept   (Pa.),  843. 

Statement  as  to,  in  application  (Tenn.),  90(1. 

What  may  be  received  as  evidence  of  (Tenn.),  900. 

False  statement  as  to   (Wash.),  998. 
AGENCY: 

False   statements   made   by    agent  in   a|)plication   estops   societ}'    (Cal.),   34. 

When  subordinate  lodge  not  agent  of  grand  lodge   (Cal.),  43. 

When  ollicers  of  local  lodge  are  agents   (Colo.),  58. 

Of  local  olKcials   (D.  C),  99. 

Of  local  officers;  estoppel  (D.  C),  98. 

Beneficiary;  estoppel   (Ga.),  114. 

Agents  and  officers,   distinction  between    (Ga. ).    107-108. 

Agent's  power;   estoppel   (Ga.),  113. 

Agent's  negligence,  liability  for   (Hawaii).  129. 

Of  collecting  officer    (Ida.),   139. 

Of  subordinate  lodge  (111. J,  197. 

Of  subordinate  lodge  (111.),  186. 

May  be  implied  from  adopted  acts  of  agent  (111.),  170. 

Of  local  lodge  officers  (111.),  167-108. 

Agents'  agi'eements  waiving  laws  (Iowa),  285. 

Agents,  waivers  by   (Iowa),  294. 

Agents,  societies  not  to  employ   paid    (Iowa).  279. 

Agent,   knowledge   of,   imputed   to   society    (Iowa),   285. 

Local   officer  agent  of   society    (Iowa).  297. 

In  collecting  assessments;   course  of  dealing  (Iowa),  296. 

What  determines    (Iowa),  296. 

Agents  may  not  be  employed  except  in   restricted  sense    (In<l.),  254. 

Agent's  knowledge  imputed  to  principal  (Ind.),  239. 


1052  FRATERNAL    SOCIETY   LAW 

AGENCY— Continued: 

Imputing  knowledge    (Ind.),  233. 

Waiver  and  estoppel    (Ind. I,  234. 

Waiver  of  agent;   imputed  knowledge   (Ind.),  239. 

Of   local    officers    (Ind.),    241. 

Of   collecting   officer    (Ind.),   241. 

Waiver  of  grounds  of  forfeiture  by    (Ind.),  242. 

Local  secretary  agent  of  supreme  body   (Kas.),  320. 

Of  local  secretary    (Kas.),  318. 

Assistant  to   collecting  officer;    estoppel    (Kas.),  31G-3I7. 

Agent,  tilling  up  application  by  (La.).  3S(i. 

Local  officers  cannot  waive  laws  (JIass.).  445. 

Agent's  knowledge  does  not  waive  warranty   (Mich.),  470. 

Of  local  lodge   (Mich.),  488. 

Of  local   lodge;    waiver   of  laws  by    (Mich.),  492. 

Agent's  knowledge  of  false  answers  not  imputed  (Minn.),  524. 

Of  local  officials  (Mo.),  602. 

Of  local  officer  (Mo.),  591. 

True  rule  as  to,  and  extent  of   (Mo.),  595. 

Of  local  lodge  respecting  payment  of  benefits   (Xeb.),  637. 

Duty  of  local  officials  (Neb.),  637. 

Of  local  officials   (Neb.),  643. 

No  right  to  waive  laws   (Neb.),  046. 

Local  officials   (Neb.),   647. 

Waiver  of  laws  through    (Neb.),  647. 

Waivers  by    (Neb.),  654. 

Local  official  cannot  waive  laws  (Neb.),  654. 

Promoter'.s  acts  not  binding  on  society  (N.  D.),  769. 

Of  local  officials   (N.  C),  748. 

Of  local  officials   (N.  C),  749. 

Of  local  official;   when  knowledge  inipvited  (N.  C),  752. 

What  acts  are  not  imputed  to  society  (N.  C.).  755. 

Officers  have  no  power  to  waive  laws   (N.  J.),  696. 

Laws  cannot  be  waived  except  upon  express  authority;  member  has  notice 
of  laws   (N.  J.),  696. 

Provisions  against  power  to  bind  society  void'  (N.  Y.),  723. 

Medical  examiner  is  agent  of  society  exclusively  regardless  of  contract  pro- 
visions   (N.  Y.),  727. 

Principal  not  bound  by  unauthorized  acts  (Okla.),  812. 

Of  subordinate  lodge  (Okla.).  810. 

Agent'.s  knowledge  of  false  statements  not  admissible   (Pa.),  845. 

Agent  as  witness,  when  competent  (Pa.),  834. 

Agent,  when  not  personally  liable   (E.  I.),  851. 

Authority  of  collector  (R.  L),  850. 

Waiver  and  estoppel    (R.  I.),  850. 

Of  medical  examiner  that  of  society    (1!.  J.).  852. 

Of  medical  examiner  limited  (R.  I.),  852. 

Not   shown  by   deolaratifins  of  agent    (S.  C),  861. 


INDEX  1053 

AGENCY— Continued : 

Of  local  lodge  in  -nitiating  iiiembiMs   (S.  C),  >S(i.3. 

Delivery  of  proofs  of  loss  to  (S.  D.),  882. 

Of  medical  examiner   (Tenn.),  903. 

Of  medical  examiner  limited    (Tenn.),  908. 

Waiver  of  laws  by  local  lodge  oflicer    (Tex.),  923. 

Of  organizer,  extent  of   (Tex.),  831. 

Medical   examiner's    knowledge   impiili'd    lo   society    (Tex.i.   1131. 

Of  medical  examiner    (Tex.),  !)44. 

Local  officials  cannot  waive   laws    (Utali),   949. 

Of  local  lodge  and  officials    (IJtali),  950. 

No  waiver  of  laws  by  custom  of  local  officers   (\'a.),  974. 

Of  general  and  local  agents   (.Vt.),  958. 

Stipulations   against    (Wash.),  994. 

Proofs  of  loss   (Wash.),  995. 

Provision  against  waivers    (Wash.),  997. 

Fraud    between    agent    and    applicant    (Wash.),    9!I8. 

Waivers  by  course  of  dealing  with  members  (Wash.),  998. 

Extent   of  power  of  agent  to   waive   conditions    (W.  Va.).   1001. 

Of  local  official   (W.  Va.),   1001. 

Contract;    equitable  estoppel    (W.  Va.),   1001. 

Waivers  through,  not  favored    (Wis.),   1019. 

Of   local    officer,   extent   of    (Wis.),    1024. 
ALIMONY: 

Fund  exempt  from    (Mich.),  47li.  ' 

ALABAMA: 

There  is  no  statute  law  of  this   State  relating  to  Fraternal  Societies.     For 
digest   see   7. 
ALASKA,  DISTRICT  OF: 

Statute  relating  to  fraternal  societies,  14-15. 

Fraternal  societies  exempt  from  operation  of  insurance  laws,  14. 

Must  file  certificate  in  office  of  Secretary  of  District,  14. 

Must  be  qualified  to  carry  on  business  in  some  State  of  the  United  .States,  14. 

Must  file  power  of  attorney  Avith  Clerks  of  District  Courts,  14. 

In   absence   of  attorney   so   appointed,   process   nuiy   be   served   on   Clerk  of 

District  Court,  14-15. 

Such   Clerk   shall   then  immediately   notify   such   company,  and  no   proceed- 
ings had  within  sixtj*  days,  15. 
Secret  or  fraternal  societies  not  fire  or  insurance  companies,  15. 
The   term   "insurer"   defined,   15. 

Violation  of   statute;    punishment,   15. 
Fees  for  filing  certificate  and  power  of  attorney.  15. 
AMBIGUITY: 

See  Construction. 
AMENDMENTS: 

To  charter,  effect  of   (Cnl.).  3S-.'^9. 
To  charter   (D.  C),  97. 
Constitution  (D.  C),  97. 


1054  FRATERNAL   SOCIETY   LAW 

AMENDMENTS— Continued: 

To  cliartci.   tni^tccs  cniiniit    fHt'ct    (Un\a).  281. 

Of  fundamental  laws   (Iowa),  280. 

Of  laws  after  cause  for  benefits  accrue    (Ind.),  233. 

For  amendments  to  laws  see  After-Enacted  Laws. 
APPEALS: 

Limited  time  to  effect   (Kas.),  311. 

Time  to  perfect   (Kas.),  314. 

Errors  on   (Jlinn.),  520. 

Appeals  from   void   jndgiiient  not   necessary    (Wis.).   1023. 
APPLICATION: 

Acceptance  of,  waives  defects    (Ark.),  27. 

Effect  of,  where  one  fails  to  be  initiated  (Ark.j,  25-20. 

False  statement  in,  when  fault  of  agent  estops  society  (Gal.),  34. 

Refusal  of  applicant  to  complete    (Colo.),  61 -(i2. 

Failure  to  complete  (Colo.),  61-02. 

Effect  of  naming  beneficiary  in    (Ga.),  108. 

Misstatements  to  medical  examiner   (Ga.),  110. 

Agent's  negligent  delay  in  forwarding;  liability  therefor  (Hawaii),  129. 

False  statements  in,  known  by  local  lodge   (111.).  ISO. 

Applicant's  age   (111.),  171. 

Statements  of  applicant  previous   to  making   (Iowa).  290. 

Copy  of,  to  be  attached  to  certificate   (Iowa),  289. 

Answers  in,  eonstnied  liberally  in  favor  of  applicant   (la.),  287. 

False  statements  in;  knowledge  of  agent  imputed  to  society  (lowii),  285. 

False  answers  in  (Jowa),  284. 

Death  of  applicant  before   liability   begun    (Ind.).  2.34. 

Misstatements  in.  regarding  habits   (KJ^),  331. 

Copy  of,  to  be  attached  to  certificate   (Ky.),  332. 

Untrue  answers  in   (Iowa),  362. 

Filled  out  by  agent    (Me.),  386-387. 

Material  representations    (Me.),  387. 

Misrepresentation  avoids  contract   (Md.),  40S-400. 

Misrepresentation    in    (ild.).   415-416. 

False  answers   in,  by  agent    (ilich.),   470-474. 

Warranties  in    (Minn.),   520. 

And  examination  conditions  precedent  to  issuance  of  certificate  (Minn.),  516. 

Member  bound  by  statements  in   (ilo.),  584. 

Materiality  of  representations  a  question  for  the  jury    (Nev.).  658. 

Duty  respecting  change  of  health    (N.  D.),  770. 

Misrepresentation  in,  avoids  contract  (X.  Y.),  722. 

Copy  of,   to  be   attached   to   certificate    (Pa.),  843. 

Delay  in  passing  upon,  does  not  create  contract   (S.  I).).  SSO. 

What  must  be  stated  in   (Tenn.).  903. 

Delay  in  acting  upon,  not  actionable    (Tcnn.),  90S. 

Statements  in,  respecting  habits    (Texas),  930. 

For  reinstatement;   representations  in   (Texas),  933. 

Questions  in,  as  to  habits  construed    (Texas),  940. 


INDEX  1055 

APPLICATION— Continued : 

>lisslatriii('iils    ill     ('I'cxas),    111:!. 

Contlict  between,  and  written  receipt   (Wash.),  900. 

Jlatorial  questions  and  answers  in   (Wis.),  1021. 
APPROXIMATE  CAUSE: 

Wlial    is    iXc-b.),    ()4U. 

Of  death   in  suicide  eases   (Neb.),  040. 
ARKANSAS: 

Statute    j;(ivi'ininj;    rralcnial    societies,    10-1!). 

"Insiiiaiice  iUueau"   to  execute  insurance  hiws.   10. 

Auditor  of  State  may  appoint  auditors,  examiners,  etc.,  to  examine  books,  16. 

Jiay   summon   and  examine   persons   rebitivu    thereto,    10. 

ilay  revoke  license,   10. 

Seal  of  Auditor's  office  is  seal  of  Insurance  Department,  10. 

"Fraternal  beneficiarj'  order,  society  or  association"  defined,  lG-17. 

Fraternal  society  may  create  and  maintain  reserve  or  emergency  fund,  17. 

Fraternal  societ.v  must  not  be  operated  for  profit.   17.. 

Society's  funds  to  be  derived  from  assessments,   17. 

Fraternal  societies  exempt  from  insurance  laws,  17. 

Annual  report  to  be  filed  with  State  Auditor,  17. 

Fee  for  tiling  annual  report,  17. 

Society  must  file  bond  with  Auditor  of  State  annually,  17-18. 

Agent  or  solicitor,  violation  of  statute,  punishment,   18. 

^Meetings  of  supreme  lodge,   18. 

Foreign   societies,  conditions   for  doing  business,   18. 

Service  of  process,  on  whom  valid,  18-19. 
ARKANSAS  CONTRACT: 

Certificate  held  to  be    (Ark.),  21. 
ARIZONA: 

Xo  statute  law   in  the  territory  governing  societies,  29. 
ASSESSMENT  INSURANCE: 

Distinctions   between,    and   old   line    insurance    (JIo.),   581. 
ASSESSMENT  PLAN: 

(If  insiiiaiice.  wliat  is   (Mo.),  582. 
ASSESSMENTS: 

Xon-paymeut  of,  forfeiture   (Ark.),  27. 

Forfeiture   for  non-pa3'ment  of    (Cal.),  43. 

Non-payment  of;  forfeiture   (Cal.),  32. 

Extra,  for  hazardous  vocations  (Colo.),  54-55. 

Tender   of;    estoppel    (Colo.),   58. 

Change  from  post  mortem  to  advance   (Colo.),  55. 

Right  to  collect  limited   (111.),  177. 

Surplus  funds  may  be  applied  to    (111.),   177. 

Notice,   requirements   of    (111.),   183. 

Jlember  cannot  be  sued  for    (111.),   196. 

Printing  and  mailing  notices  required    (111.),   102. 

Absence  of  collecting  officer   (Iowa),  295. 

Course  of  dealing  as  to  collections   (Iowa),  296. 


1056  FRATERNAL    SOCIETY    LAW 

ASSESSMENTS— Continued : 

To  be  levied  only  on  class  responsible  for  loss   (la.),  2S2. 

Advance,  need  not  be  continually  paid  (Iowa),  277. 

Application   of   advance    (Iowa),  277. 

Prompt  payment  of    (Ind.),  235. 

Are  niembeis  debtors  to  the  society  (Ind.),  229. 

Payment  after  forfeited  member's  death   (Ind.),  235. 

Right  to  increase  payments  and  readjust  rates    (Kas.),   325. 

Return  of,  on  void  contract  (Ky.),  332. 

Duty  to   levy    (Mass.),  446. 

Payments   of,   after   member's   deatli    (iJd.).   412. 

Collection  of,  may  be  enforced    (Wich.),  491. 

Notice  of,  under  after-enacted  laws   (Minn.),  532. 

Amendments   as   to,  by  boards  of  directors    (Minn.),  529. 

After-enacted  laws   binding    (Miss.),  551. 

Paid  by   stranger;    right  to  recover    (Miss.),  554. 

Increasing   members'   payments    (Mich.),   469. 

Receiver  may  enforce  collection  of   (Mich.),  491. 

Tenders  of,  refused,   need  not  be  repeated    (Mich.),  48S. 

Waiver  of  by-laws  as  to  prompt  payment  allowed  (Mo,),  594. 

The   presumed  amount   of   one    (ilo.),  583. 

Receipt  of,  in  contract  not  subject  to  be  questioned    (Mo.),  582. 

When  definite  and  fixed   (Mo.),  581. 

Rates   subject   to  change    (Mo.),   578. 

Societies  not  restricted  to    (Mo.;  ,  602. 

Notice    of    (Neb.),   653. 

Subject  to   increase   to  meet  society's   requirements    (Neb.),   646. 

Required  monthly  if  called  (Neb.),  644. 

Can  a  member  set  off  his  claim  of  losses  against  society's  claim  for  assess- 
ments,  (N.  J.),  684. 

Being  common  burdens  of  all,  no  death  cfaim  is  entitled  to  preference  (N. 
Y.),    731. 

Prompt  payment  of,  not  waived  by  occasional  favors   (N.  C),  754. 

By-law  providing  for  mailing  notices  of,  valid  (N.  C).  753.    ' 

Members  cannot  refuse  to  pay,  for  losses  occurring  during  membership 
N.  C),  752. 

Payment  of,  by  checks  through  mails   (N.  C),  746. 

Paid  in  advance;  application  of   (N.  D.).  769. 

Recoverable  against  forfeited  member   (N.  H.},  673. 

Members'  signing  laws  providing  for,  not  essential  (Ohio),  792. 

^Vhen  to  be  paid  by  lodge   (Ore.),  820. 

Worthless  check  not  payment  of  (Pa.),  835. 

Society  holds  members'  payments  as  trust  fund   (Pa.).  839. 

Against  members  are  not  debts  recoverable  at  law   (R.  I.),  854. 

Members  presumed  to  know  riglits  under   (R.  I.),  851. 

Not  to  be  levied  for  subsequent  losses  after  receivership   (R.  I.),  857. 

Forfeiture  provision  applies  (o  all  members   (S.  C),  866. 

Forfeiture  for  failure  to  p;iy   (S.  C),  850. 


INDEX  1057 

ASSESSMENTS— Contipued: 

When  tenders  of,  are  waived   (Tenn.),  911. 

When  right  to  levy  limited   (Tonn.),  911. 

No  presumption  as  to  legality  of  (Tenn.),  904. 

Aftcrenaetcd  laws  increasing  rates  valid   (Tenn.),  901. 

Wailing  draft  not  payment  of   (Tex.),  945. 

Paid   by   creditors    (Tex.),  942. 

Payment  of,  under  protest,  is  not  election  to  accept  reduced  contract  (Tex.), 
939. 

Agency  of  local  lodge,  etc.   (Utah),  950. 

Duty  of  lodge  to  pay,  when  there  are  funds  in  hand  (Utah),  950. 

Payments  by  husband  on  wife's  certificate   (Va.),  979. 

Meaning  of  stipulation  that  rates  may  be  changed  (Va.),  976. 

Must  Ix"  paid  by  insane  member   (Wash.),  997. 

N.  F.  C.  mortality  table  approved  (Wash.),  993. 

Receiving  overdue   payments    (Wis.),   1020. 

Waivers  of  prompt  payments  of  (Wis.),  1017. 
ASSIGNMENT: 

Of  certificates  to  creditors  enforceable  in  equity  (111.),  188. 

Of  certificate    (111.),   195. 

Of  fund  valid    (111.),   179. 

Of     fund  under  certificate  valid    (111.),   178. 

Beneficiary  has  no  interest  during  member's  life  to  be  assigned  (111.),  162. 

Of  certificate  as  a  change  of  beneficiary   (Ind.),  242. 

Of  benefit  fund  to  creditors  (Mass.),  450. 

Of  certificate  valid  unless   prohibited    (Md.),  415. 

Of  benefits   (Minn.),  530. 

Of  amount  to  be  received  under  certificate;  when  valid  (Mo.),  588. 

Not  wagering  contract   (Nev.),  659. 

Form  not  essential   (N.  C),  756. 

Valid,   when    (N.   Y.),   730. 

Of  interest  in  certificate    (Ore.),  819. 

Valid  as  between  assignor  and  assignee   (Tex.),  926. 
ATTACHMENT: 

Of  funds    (Ariz.),  29. 

Of  funds  of  society  by  creditor  (Cal.),  36. 

Construction  of  exempting  statute   (Conn.),  71. 

Of  fund  for  debt,  exemption    (111.),   190. 

Of  benefit  fund   (III.),  178. 

Benefit  fund  not  subject  to  creditors'  claims   (Miss.),  555. 

See  Creditors. 
Garnishment. 
ATTORNEY: 

Power  of,  to  insurance  commissioner  (N.  C),  748-751. 

Fees  not  allowed  out  of  fund  in  interpleader  cases  (Tex.).  936;  (Ga.),  110. 
AVERMENTS: 

Of  performance  requisite  in  pleading   (Ind.),  232. 

67 


1058  FRATERNAL   SOCIETY   LAW 

BENEFICIARIES: 

Statute  of  State  enlarges  class  of  (A]a.),  0. 

Children  of  different  wives  equally  eligible  to  benefit   (Ala.),  9-10. 

Children  born  previously  and  children  born  subsequently  to  contract  equally 

eligible  to  benefit  (Ala.),  9-10. 
Childi-en  surviving,   who   are   meant    (Ala.).   9-10. 
Trustees  for    (Ala.),  9-10. 

Substitution  on  death  of  original  beneficiary   (Ala.),  9. 
Class  of,  enlarged  by  State  statute   (Ala.),  9. 
Son  of  member's  deceased  wife  by  former  husband  cannot  take  benefit  (Ala.), 

8-9. 
Change  of  (Ark.),  25-26. 
Heirs  at  law,  who  are  (Ark.),  23-24. 
Legal  heirs  (Cal.)',  40. 

Effect  of  divorce  "of  wife  Avhen   named  as    (Cal.),  41. 
Fiancee  as  such   (Cal.),  42. 
Change  of;   compliance  with  laws   (Cal.),  44. 
Interest  of,  a  mere  expectancy  (Cal.),  45. 
May  be   changed  at  will   of  member    (Cal.),   45. 
Designation  of  unmarried  member's  mother  valid  after  his  marriage   (Cal.), 

36. 
Are  creditors  of  society  and  may  attach  funds   (Cal.),  .36. 
Effect  of  divorce  of  .(Cal.),  41-42. 
Eights  of  fiancee  (Cal.),  42. 
Cannot  be  changed  by  will    (Cal.).  40. 
Heirs  at   law.  who  are   (Cal.).  40. 
Sister-in-law    (Cal.),  35. 

Right  to  name  not  a  vested  right    (Cal.l.  34. 
Dependency  (Cal.),  33. 

Extension  of  class  by  constituticm  and  by-laws   (Cal.).  3(1 
Change  of   (Colo.),  55. 
Have  no  vested  interests   ( Colo,  i .  55. 
When  have  vested  interests  (Colo.),  .50. 

Change  of   (Colo.),  56. 
Vested   interests    (Colo.),  57. 
^^Iio  are  heirs  at  law   (Colo.),  57. 
Presumption   of   legality    (Colo.).   57-58. 
Change   of;    vested  interest    (Colo.),  50. 
Divorce  of  wife;   legal  heirs   (Colo.),  60-61. 
As  affected  by  aftei'-enaeted  laws   (Conn.).  71. 
No  vested  interest   (Conn.),  71-72. 
^Members'  "family"  (Conn.),  72. 
Laws   at   date   of   death   govern    iConn.).   72. 
Statute   not  retroactive    (Del.).   83-84. 
^X^\on  creditor  is  entitled  to  take  fund  as    (Dcl.K  83-84. 
Definition  of  ''family"    (Ga.),  IIC. 
"Family"    (Ga.),    115. 
Bound  bv  member's  admissions   (Ga.).  114. 


INDEX  1059 

BENEFICIARIES— Continued : 

Society   not  estopiiod  to  i|iipsli(iii  lU'sifjiiiitiiiii  of   |t;a.i.   HI. 

Xot  entitled  to   take    (Ga.),   11:!. 

Ke.soit  to  civil  courts    (Ga.),   112. 

'•Ne.\t  oC  kin"   (Ga.),  112. 

Death    (jI.   Ijct'oro  member    (Ga.).    I(»s-I0!l. 

I'erson   named   in    application    (<ia.l,    KIS. 

l.ej;al  licirs   (Hawaii),  129-130. 

Dependency    (Hawaii),    129. 

Ila\e  no  vested  or  assij;nal>le  interest  dnriii^'  life  ot'  member   (111.),  102. 

Entitle<l   to  bcndit   ol'  construction  of  contraet  where  two  are  possible    (111.), 

101. 
Indcr  .Missouri  slatntc   (111.1,  1S4. 
iMay    assi^ni   cxpe<'ted   benclit    (111.),    178-17!!. 
Assignment  of  contingent  interest  by   (111.),  179. 
Kesort  to  civil  courts  cannot  be  denied  to  (111.),  ISl. 
Enlarging  cla.sses  by  amendments   (111.),  184. 
Class  of,  in  Missouri,  statute  construed   (111.),  184. 
Death    in   common   disaster   with    member;    no   presumption  of   survivorship 

(111.),   185. 
Have  no  voted  interests  in  certificate  (111.),  185-180. 
Death  of,  in  I'omnion  disaster  with  member   (111.),  186. 
Jlistake  of  member,  effect  of    (111.),  188. 

Rights  of  creditors  to  fund  as,  to  be  enforced  in  equity    (111.),  188-189. 
Class  of,  may  be  extended  by  after-enacted  laws  (111. I.  190. 
Wlien  creditors  may  take  fund  as   (111.),  190. 
Eights  of  heirs  at  law   (111.),  191. 
May  deny  statements  in  proofs  of  death   (III.),  191. 
Bj'-laws  respecting,  may  be  waived   (III.),  190. 
Have  no  vested  i"ights;  change  of    (111.),  190. 
Class  of,  may  be  restricted   (111.),  195-19C. 
Eight  to  name  by  will  (111.),  197. 

Equitable  rights  in  certificate  nmy  be  enforced   (111. I.  198. 
Jlember's  marriage  does  not   all'ect  designation   made    (111.),   198. 
Not  affected  by  member's  marriage  (III.),  19S. 
May  deny  statements  in  proofs  of  death   (III.),  175. 
Failure  of  designated;   order  of  heirship   (III.),  173. 
Restricting   class    of    (111.),    195-190. 

Heirs  at  law  take  where  member  murdered  by    (111.).  173. 
Murder  of  member  by,  forfeits  rights   (III.).  172. 
Society  maj'  restrict  statutory  classes    (111.),   167. 
Dependency  at  member's  death  determines  eligibility   (111.).  100. 
Eligibility  at  maturity  of  contract  determines  right   (III.),  106. 
Conflict  between  charter  and  statutory  provisions   (111.),  166. 
Adopted  child  is  dependent  (111.),  165. 

Construction  to  be  given  to  ambiguous  designation    (Ill.l,  105. 
Niece  by  affinity   (Iowa),  274-275. 
Wrong,  payment   to;    suit   by   other  claimant    (Iowa).  275. 


1060  FRATERNAL    SOCIETY    LAW 

BENEFICIARIES— Continued : 

Ineffectual  change  of   (Iowa),  276. 
Change   of    (Iowa),   279. 
Have  no  vested  interests    (Iowa),  280. 
Change  of;   estoppel    (Iowa),  280. 
Divorced   wife    (Iowa).   283-284. 
Change   of;    burden   of   proof    I  Iowa),   287. 

Change  of.    One  partly  insane  from  impaired  health  may  change  (Iowa),  287. 
Have  no  vested  interests   (Iowa),  288. 
Change    of    (Iowa),    288-289. 

Construction  of  terms  of  designation   (Iowa).  289. 
Change  of   (Iowa),  293. 

Change  of,  must  be  in  inannfr  prescribed  by  laws  (Iowa),  293. 
Presumption  that  beneficiary  is  qualified  (Iowa),  293. 
Legal  heirs  include  illegitimate  children   (Iowa),  293. 
Change  of;   claimants  cannot  complain  of  waiver  of  laws   (la.),  294. 
Divorced  wife  competent   (Iowa),  297. 

Suit   of,  against   third  person   to   whom   benefit   was   paid    (Ind.l.  231. 
Have  no  vested  interests  (Ind.),  232. 
^^   Fraud,  effect  of  change  of  beneficiary  through  (Ind.).  234. 
Not  bound  by  admissions  of  member  (Ind.),  232. 
Have  no  vested  interests    (Ind.),  233. 
Change   of,   through    fraud    (Ind.),   234. 
Have  no  vested  interests;  change  of   (Ind.),  23(i. 

Have  no  vested  interests;  failure  to  name  new  beneficiary   (Ind.),  236. 
Necessary  averments  in   petition  to  recover    (Ind.),  237. 
Change  of    (Ind.),  242. 
Have   no   vested  interests    (Ind.),  242. 
Change  of;   assignment  of  certificate   (Ind.),  242. 

Claim  of;  admissions  of  member  not  sufficient  to  defeat    (Ind.).  243. 
Designation  of   I  Ind.),  244. 
J^'ot  bound  by  coroner's  inquest   (Ind.),  250. 

Ineligibility  of,  in  suit,  must  be  raised  in  pleadings  (Kas.),  31.5. 
Change  of  (Kas.),  316. 

Are  limited  to  statutory  classes   (Kas.),  320. 
Change  of;  fraudulent  inducements   (Kas.),  326. 
Admissions  of,  in  proofs  of  death  (Kas.),  327. 
Surviving  widow,   defendants    (Ky.),   337. 
Second  wife  competent  to  take  benefit   (Ky.),  337. 
Name — Idem   sonans   (La.).  3G3. 
'■Family'    (Mass.),  439-440. 
Dependency  (Mass.),  444. 

Suit  by  executor  of  member   (Mass.),  444-445. 
Change  of  (Mass.),  445. 
Children  as   (Mass.),  448. 
Failure  of  (Mass.),  448-449. 
Right  of   widow  vs.  executor    (Mass.),  449. 
Assignment    to  creditors    (Mass.).  4,')0. 


INDEX  lOGl 

BENEFICIARIES— Continued : 

Adopted  clijld    (Jle.),  388. 

Kiglit  to  resort  to  civil  courts  not  to  be  restricted   (Md.),  409-410. 

Remedies  in  society  to  be  exluui.sted  before  resort  is  made  to  civil  courts 
(Md.),   410-411. 

Benefits  exempt   from   creditor's  claims    (Md.).  411-412. 

Death  of,  before  member   (Md.).  414-415. 

Cannot   compel    continuation   of   membership    (Md.),   40s. 

Assignment   of   ccrtiMcatc   valid,   when    {^Id.},   41.5. 

Stepfather  not  a   member  of  family   of  stepdaughter   (^lich.),  47-5. 

What  laws  determine   (Mich.),  47(5. 

Next  of  kin   (Mich.),  477. 

Change  of,  by  after-enacted  laws  (Mich.),  478. 

Right  of,  to  contest  change   (Mich.),  484. 

Have  no  vested  interests   (Mich.),  484. 

Have  right  to  contest  change  where  mental  capacity  of  member  in  ques- 
tion   (Mich.),   484. 

Widow  de  facto  (Mich.),  484. 

Public  policy    (ilich.),  485. 

Change  of  (Mich.),  485. 

Change  of;   laws  respecting,  may   be  waived    (.Mi<-li.).  4s(i. 

Trustee  may  be  designated   (Mich.),  490. 

Appointment  of  trustee    (Mich.),  490. 

Trust   agreement  for  creditor    (Mich.),  4(i7. 

Insurable  interest  (Mich.).  4(17. 

"Member  of  family"   (Jlicli.).  4t!9. 

Change  of    (Minn.),  527. 

Have  no  interest  in  contract  before  maturity   (Minn.).  528. 

Have  no  vested  interests    (Minn.),  528. 

Eligibility  of  stranger  (Minn.),  530. 

Change  of  (Minn.),  522. 

Orphans,  who  are   (Minn.),  523. 

■'Living  issue"  construed   (Minn.),  525. 

Limitations  of  law  presumed   to  be  known    (Jliss.),  5.53. 

AA'here  stranger  pays  assessments    (Miss.),  554. 

Limited  to  class  named  in  law   (Miss.),  554. 

Laws  for  changing   (Miss.).  556. 

Coerced  marriage   (Miss.).  551. 

Disposition  by  will   (Miss.),  551. 

Legal  representatives  as    (Mo.),  5.S2. 

Have  no  vested  interests  (Mo.).  600. 

Rules  as  to  change   (Mo.),  603. 

Married  adult  son  not  a  dependent   (Mo.),  603. 

Heirs  at  law,  widow  is  (Mo.),  604. 

WHiat  is  meant  by  dependency  (Mo),  605. 

Common  law-  wife  may  be   (Mo.),  005. 

Have  no  vested  interests  while  member  is  living  (Mo.),  606. 

Right  of  member  to  designate  new   (Mo.),  606. 


1062  FRATERNAL   SOCIETY   LAW 

BENEFICIARIES— Continued: 

Rights  of  creditor   (Mo.),  007. 

No  vested  interest  until  niiitiirit3'  of  contract   (JIo.).  GOT. 
Change  of;  when  rules  may  be  waived  (Mo.),  608. 
Family  (Mo.),  608. 
Have  no  vested  interests   (Mo.),  579. 
Classes  determined  by  laws  of  Missouri   (Mo.),  588. 
Rule  as  to  changes  of  (Mo.),  589. 
Designation  rec)>iired   (Mo.),  589. 
May  have  equitable  vested  interests  (Mo.).  590. 
Changes  of,  made  at  will  by  member   (Mo.),  590. 
Rules  as  to  change  of  (Mo.),  590. 
Classes  in  Mi.ssouri  and  Illinois  same   (Mo.),  590. 
Death  lief  ore  member:   rule  as  to   (!Mo.),  593. 
Change  of  (Mont.).  010. 

AVaiver  of  laws  respecting  changes  of   (Mont.).  610. 
Laws  must  be  followed  in  making  changes  (Mont.).  611. 
Change  of,  must  be  complete  before  member's  death   (Mont.).  611. 
Pvights  not  affected  by  interpleader  (ilont.),  611. 
Creditors  cannot  be   (Neb.),  634. 
Change  of:   no  vested  interest   (Neb.).  634. 
Limited  by  statute  (Neb.),  637. 
Change  of   (Neb.).  639. 
Change  of;  no  vested  interest  (Neb.),  048. 
Person  not  named  as  such  has  no  right   (N.  C),  747. 
Incompetent,  not   helped  by  society's   interpleader    (N.  J.),  694. 
Ante   nuptial   ])arol   contract   void   (N.   3.).  694. 
Heirs  of  beneficiary  (N.  J.),  094. 

When  interest  vested  and  cannot  be  defeated  by  designation  of  new  bene- 
ficiary (N.  Y.),  715. 
Sister-in-law   may    be    named    as   beneficiary    (N.    Y.).    715. 
Laws  lestricting  class  waived   (N.  Y.),  720. 

AAHieu   ultra   vires   act   in  naming  one  is   waived    (N.  Y.),  720. 
Change  of,  when  effective   (N.  Y.),  724. 

Payment  to  trustee  no  release  against  real  claimant   (N.  Y.),   725. 
AMiat  is  meant  liy  term   heirs   (N.  Y.l.  725. 
Change  of;   when  valid   (N.  Y.).  720. 

Change  of;   provisions  for.  in  hiw   exclusive   (N.  Y.).  726. 
Dependency  (Ohio),  794. 
Change  of;  dependency   (Oliiu),  794. 
Change  of    (Ohio),  79."). 
Change  of  (Ore.),  817. 

Cliange  of,  must  be  in  conformity  with  law   (Ore.).  817. 
Rights  of,  under  interpleader  suit    (Ore.),  819. 

Vested  interest:      Assigmnml   of  cipiitable  interest  by  member   (Ore.),  819. 
Change  of,  must   be   in  strict   conloiinity    witli   law    (Ore.).  S19. 
Naming  of,  by  will   (Pa.).  837. 
"Nearest  friend"  Pa.),  838. 


INDEX  1063 

BENEFICIARIES— Continued : 

Not  affected  by  subsecjueut  clianges  in  law   (Pa.),  S3!). 
No  vested  interest   (Pa.),  839. 
Right  of  divorced  wife   (Pa.),  839. 
Brother  as  trustee  for  wife  (Pa.).  840. 
Rights  of  creditors  (Pa.),  840. 
Right  of  member  to  change,  absolute   (Pa.),  841. 
After  death  of  member  is  creditor  of  society    (Pa.).  843. 
"Heirs  at  law"    (Pa.),   844. 
Children  by  different  wives  (Pa.),  84G. 
Daughter  as  against  brother  of  member   (Pa.),  848. 
Change  of;    negligence  of  society  no  bar   (R.  I.),  858. 
Insurable  interest  (R.  I.).  8i)l. 
Failure  of    (R.   I.),  8o4. 
Insurable  interest   (S.  C),  859. 
"Wife  and  heirs"  (S.  C),  803. 
Rights  of  wife  (S.  C),  864. 
Change  of;  vested  interest    (S.  D.),  879. 

When  there  is  an  equitable  interest  in  certificate   (S.  D.),  880. 
Who  may  be;  rights  of  assignee  (Tenn.),  903. 
Have  no  vested  interests    (Tenn.),  903. 
Right  of  change  absolute   (Tenn.),  904. 

Beneficiary  named  not  affected  by  member's  will   (I'cun.l.  904. 
Not  authorized,  void   (Tenn.),  904. 
What  is  dependency?    (Tenn.),  905. 
Designation  of,  by  member  insane  void   ('J'eiin.),  905. 
Right   of   mother   as   against   wife    (Tenn.),   908. 
Provisions  respecting,  may  be  waived  (Tenn.),  910. 
Death  of;   who  is  entitled  to  fund   (Tenn.).  912. 
Change  of    (Texas),  922. 
Death  of;  rights  of  wife  (Texas).  923. 
When  heir  takes  benefit   (Texas),  927. 

Lawfully  named  not  ousted  by  after-enacted  laws   (Texas),  930. 
'Death  before  member   (Texas),  931. 
Who  may  be   (Texas),  932. 
May  be  named  by  will   (Texas).  929. 
Relatives,   dependents    (Texas),   929. 
Have  no  vested  interests  (Texas).  935. 

Who  may  be;  death  in  common  disaster:   rule  of  survivorship   (Texas),  935. 
Right  to  change,  complete   (Texas),  937. 
Illegitimate  children   may  be  named    (Texas).  942. 
Creditors   cannot  be,   but    may  secure   return   of   assessments   paid  to  keep 

contract  alive    (Texas),  942. 
Who,   of    monument    fund    in    Woodmen    (Texas),    944. 
Revoked,  and  illegal  designation  (Texas),  945. 
Society   may   waive   provisions    respecting   change    (Texas),    940. 
Rules   as  to  change  of    (Utah).  948. 
Right  in  member  to  change,  absolute    (Utah),  949. 
Has   no   vested   intei-est    (Wash).   992. 


1064  FRATERNAL    SOCIETY   LAW 

BENEFICIARIES— Continued : 

Rules   for  changing,  may  be   waived    (Wash.).  992. 

Eight  to  change    (Wash.),  997. 

Change  of;   requisites   (Wis.),  1020. 

Variance  between  certificate  and  application   (Wis.),  1022. 

Rule  as  to  change  of   (Wis.).  1025. 

When   unable   to   take   benefit    (Wis.).    1026. 

Right  to  change,  general    (Wis.).  1027. 

Kot  controlled  by  will   (Wis.),  1027. 
BENEFIT  CERTIFICATE: 

Construction  given  to,  by  society  not  binding  on  courts  (Ala.),  9. 

Void  if  it  agrees  to  repay  to  member  during  his  life  time  payments  made 
(Ala.),  7. 

Forfeiture  of,  for  non-payment  of  assessments   (.^rk.),  27. 

When  liability  under,  begins   (Ark.),  26-27. 

Invalidated  by  failure  to  become  initiated   (Ark.),  25-26. 

Effect  of  suspension  of  lodge  on    (Ark.),  22. 

Held  to  be  an  Arkansas  contract   (Ark.),  21. 

Lien   against    (Cal.),   40. 

Lien  on;   statute  of  limitations    (Cal.).  40. 

Forfeiture  of,  for  non-payment  of  assessments   (Cal.).  32. 

Failure  to  complete  application  for  (Colo.),  61-62. 

Subject  to  taxation   (111.),  175. 

Cannot  be  reinstated  after  member's  death   (D.  C).  100-101. 

Cannot  be  reduced  in  amount  by  after-enacted  laws  (Ga.),  III. 

Subject  to  taxation    (111.),  175. 

Effect  of  issuing,  where  no  beneficiary  is  named  (Ga.).  108. 

Need  not  be  issued   (Ga.).  107. 

Rights   of  creditors  to  fund  under    (111.),   198. 

Assignability  of;   construction  of  act  of   1893    (111.),  195. 

Cancellation  of   (111.),   194-195. 

Rights  of  creditors  in  equity;   assignment    (111.),  188-189. 

Assignable  in  equity    (111.),   188. 

Reformation  of.  after  member's  death    (111.).  188. 

Situs  of  contract  represented  by    (111.),  187. 

Beneficiary  has  no  vested  interest  in    (111.).  185-186. 

Presumed  to  remain  in  force  after  issue   (111.),  180. 

Copy  of  application  to  be  attached  to   (Iowa),  289. 

Not  requisite  to  effect  contract   (Iowa),  284. 

Before  cancellation  payments  made  must  be  returned   (Ind.),  251. 

Beneficiary  has  no  vested  interest  in   (Ind.),  233. 

And  by-laws  conflict  between  terms  of   (Ind.),  240. 

Copy  of  application  to  accompany  same  (Ky.),  334. 

Delivery  of  (JNIich.),  48U. 

Issuance  before  initiation    (.Midi. I.  487. 

Delivery  of,  to  local  lodge  (Mich.).  488. 

Delivery  of;   waiving  payments    (Mich.),  481. 

And  laws,  conflict  between   (Mo.),  601. 

Presumption  as  to  amount  of  one  assessment    (Mo.),  583. 


INDEX  1065 

BENEFIT  CERTIFICATE— Continued: 

L088  of,  does  not  prevent  suit  iin   (N'el).),  t]^'i. 

Proceeds  of   (Neb.),  637. 

Jurisdiction    of    suit    on    (Neb.).    041. 

Unauthorized  delivery  of    (Xeb.).   045. 

Issuance  of,  after  applicant's  dcatli  (Tenn.).  907. 

Wlien   surrendered   is  dead    (Tenn.),  910. 

Assignment  of,  valid    (Texas),  927. 

Delivery  of,  condition   precedent   to   liability    (I'tali),  949. 
BENEFIT   MEMBERS: 

All  need  not  be  (Mo.),  577. 
BENEFITS: 

Amount  of;    post  mortem    assessment    (Ark.),  23. 

Reduction   of,   by   after-enacted   laws    (Cal.),   40. 

Reduction  of,  cannot   be  made  by  after-enacted  laws    (Cal.),  40-41. 

Amount  of  certificate  cannot  be  reduced  by  after-enacted  law  (Ga.),  111. 

Not   subject  to  attachment   for  debt   (111.),   17S. 

Funds,  limitations  on  right  to  assess  for  (III.),  177. 

Funds,  society   is  a  trustee  of    (111.),   176. 

Fund  assigned",  enforcible  in  equity   (111.),  179. 

Fund  no  part  of  member's   estate    (111.),  198. 

Funds  subject  to  taxation    (III.),   185. 

Fund,  right  of  creditors  to,  under  assignment   (111.).  188-189. 

Fund,  when  creditors  may  take  (111.),  190. 

Fund  exempt   from  attachment    (111).   190. 

Premature  suit  for   (Iowa),  278. 

Amendment  of  laws  after  accrual  of  (Ind.),  233. 

Fund  exempt  from  creditor's  claims  (Kas.),  325. 

Reduction   of,  by   after-enacted  laws    (La.),   363. 

E.xempt  from  creditor's  claims   (Md.),  411. 

Cash  to  member   (Mich.),  468. 

Assignment  of;  waiver  of  laws   (Minn.),  530. 

And  obligations  subject  to  change  (ilo.),  578. 

Creditors  can  acquire  no  rights  in   (Neb.),  634. 

Payment   of,   through   local   lodge    (Neb.),   637. 

Duty  of  local  lodge  upon  receiving  from  society   (N.  H.),  673. 

Member  under  charges  not  entitled  to   (N.  H.),  674. 

What  is  total  disability?    (N.  H.),  674. 

Exempt  from  creditor's  claims    (N.  Y.),  714. 

Reduction  of,  by  after-enacted  laws  void  (N.  Y.),  724. 

Funeral,  administrator  may  recover   (Utah),  945. 

See  Sick  Benefits: 
BOND  TO  STATE: 

Suit  on;  limitations  (Ark.),  20. 

Date   of  beginning  of  liability   under    (Ark.),  20. 
BOOKS: 

Of  society  not  only  evidence  of  good  standing   (111.),   168. 

Of  subordinate  lodge,  as  evidence   (Neb.),  047. 

See  Evidence. 


1066  FRATERNAL    SOCIETY    LAW 

BURDEN  OF  PROOF: 

111  case  of  suicide   (Aik.),  19. 

As  to  reinstatement  of  member   (Ark.),   19. 

As  to  amount  of  post  mortem  assessment  on  society   (Ark.),  23. 

Legality  of  marriage  presumed    (Colo.).  50. 

In  death  in  common  disaster  cases   (111.).  18G. 

Always  on   society  in  suicidal  cases    (111.),   17U-177. 

In   suicide  cases    (iJinn.),  527. 

In   suicide   cases    (Texas),   923. 

For  evidence,  see  Evidence. 
BY-LAWS: 

Proof   of    (Ark.),   22. 

Are  part  of  contract  witli   member   (Cal.),  47. 

jNIay  e.Ktend  class  of  beneficiaries   (Cal.),  36. 

Are  part  of  contract   (Cal.).  33-34. 

Of  fraternal  society,  part  of  contract   (Cal.),  32. 

Are  prospective  and  in  operation   iD.  C),  97. 

Constitutions  are    (111.),  194. 

Must  be  reasonable    (Md.),  410. 

Printed,  admissible  in  evidence   (Md.),  409. 

For  amendments,  see  After-Enacted  Laws. 
CALIFORNIA: 

Boiieticiary   societies   exempt   from   insurance   laws,   30. 
CANCELLATION: 

ijf   certificate    (111.),    194-195. 

Payments  made  to  be  returned  before  (Ind.),  251. 

Of  contract;  measure  of  damages  (X.  C),  750. 

Of  inembersliip,  right  to   (Texas).  939. 
CASH  BENEFITS: 

Cash  benefits  to  member   (^lich.),  468. 

Fraternal  societies  cannot  grant,  to  members    lilinn.l.  514. 

See  Benefits  and  Contracts. 
CERTIFICATE: 

See  Benefit  Certificate. 
CHARITY: 

Fraternal  society  is  not   (Cal.),  37. 

Societies   are   not  public  charities    (111.).    104-165. 

Defined;   society  is  not   (Me.),  388-389. 

^Miat  is   (Miss.),  553. 
CHARTER: 

After-cnactod  laws  within  powers  (Ala.),  7. 

New;   effect  on  member's  contracts    (Cal.).  38-39. 

Amendment  of  (D.  C),  97. 

\^Tio  are  beneficiaries  when  in  conflict  with   statute    illl.).  166. 

Charter  members'  rights   (111.),  192. 

And  statutes  are  the  organic. law  of  a  society    (111.),  171. 

Ultra   vires    acts    (111.),    171. 

Powers  under  (Kas.),  318. 


INDEX  1067 

CHARTER— Continued : 

rowers  of  sooieties  (Jld.),  41f). 

Iliglipr   than  constitution    (Miss.).  .'5.56. 

On   forfeiture   of.    individual    inenilicrs   lieco owners   of   society's   property 

(S.  C),  H(iO. 
CHILDREN: 

Children   of   different    wives   and   born    previouhly    :ind    -ul)^^ec|U('ntly    to   con- 
tract equally  eli^rihle    (Ala.),  9-10. 

Surviving  wlio   are   witliin    the   term    (Ala.),   0-10. 

Adopted,    are   dependents    (III.),    165. 

Illegitimate,  ineluded  in  term  "legal  heirs''   (Iowa),  293. 

As  beneficiaries   (Mass.),  448. 

Of  dilTerent  wives  as  beneficiaries   (Pa.),  846. 

Illegitimate,   may    be-  beneficiaries    (Texas),   942. 
CIVIL   COURTS: 

Sec  Courts. 
CLASSES: 

Of  beneficiaries  enlarged  by  statute    (Ala.),  9. 

Creation  of;  discrimination  (Cal.),  ;iO-,31. 

Of   benfieciaries    may    be   restricted    illl.l.    Hl.-i-llKi. 

Of  beneficiaries  may  be  restricted  (111.).  1(17. 

Separate,  in  same  society    (Iowa),  282. 

Rights   of  member  to   transfer  from   one  class   to  another    (Ind.),  248. 

Creation  of;   change  of  |ibin>;   after  enacted   law^   (Ind.).  24.5-247. 

liiglit  of  members  respecting  transfer  from  one  class  to  another   (Inil,).  238. 

Separate  classes,  separate   funds    (Ky.),   S.W. 

New.  created  by  after-enacted  laws    (Mass.),  447-448. 

Eiglit  of  society  to  separate  membership  into   (Mass.).  442. 

Eight  to  establish    (Minn.),  ,529. 

Right  of  society  to  classify  its  nu'Uibers    (Neb.).  035. 
COLLATERAL  ATTACK: 

I  |ic>n  after-enacted  laws   (Xcb. ).  (i45. 
COLORADO: 

Statute  relating  to  fraternal  beneficiary  societies,  50-54. 

Company   or   Insui'ance   Company   defined,   50. 

"Domestic"   and   "Foreign"   defined,   50. 

"Commissioner"  and   "Deputy  Commissioner''  defined.  50-51. 

Diversion  of  fluids  for  political  purposes  prohibited,  51. 

Testifying  before   courts,  etc.,   51. 

Production   of  books,   papers   and   otlier   docnmeiits,  51. 

Such  testimony  shall  not  be  used  against  him  in  any  criminal  proceeding.  51. 

Fraternal  societies  not  subject  to  general  insurance  laws,  51. 

But  must  file  annual  statement  and  pay  fee  of  $5.00,  52. 

Lodge  system,  what  societies  shall  be  deemed  to  operate  under,  .52. 
,     Lodges  to  meet  at  least  once  each  month,  52. 

Must  file  copy  of  charter  or  articles  of  incorporation.  .52,  53-54. 

Must  file  certificate  designating  agent  on  whom  process  may  be  served.  52. 

Where  suits   inav  be  brought   against   societies,  52. 


1068  FRATERNAL   SOCIETY   LAW 

COLORADO— Continued: 

Lodges  may  bring  actions  on  bonds,  52-53. 

Secretary  of  State,   fees  of,  53. 

Statute  must  be  complied  with  within  90  days.  5.3. 

Contract  of  life  insurance,  what  shall  be  deemed,  53. 

May  not  be  issued  except  by  bona  fide  fraternal  societies  or  insurance  com- 
panies;  punishment,  53. 

Condition  lequiring  member  to   patronize  certain   undertaking   firms,  unlaw- 
ful :    punishment,  53. 
COMMISSIONER  OF  INSURANCE: 

See  Insurance  Commissioner. 
COMMIT  SUICIDE: 

Defined   (111.).  172. 

8rp  Suicide. 
COMMON  DISASTER: 

Deatli  in;    no   presumption   of  .survivorship    (HI.),   185. 

Death  in;    burden   of  proof    (111.),   186. 

Death  in   (Texas),  927. 

Death  in,  and  rule  of  survivorship    (Texas),  934. 

Deaths  in   (Texa.s).  935. 
COMMON  LAW: 

I'lesumed  to  lie  the  same  in  each  State  (ilo. I.  59G. 
COMMUNICATIONS: 

See  Privileged  Communications. 
COMPETITION: 

When   not   permitted   between    societies    (Mich.).  481. 
COMPROMISES: 

Powers  of  societies   respecting   (Conn.),  72. 

By  guardians   without   authority    (111.),   174. 

By  guardians,  unauthorized   (111.),  173. 

Eelease  on  part  payment   (111.),   163. 

Offer  of,  waives  defense  that  nothing  is  due  (Kas.).  322. 

Accord  and  satisfaction   (ilass.).  439. 

When  to  be  set  aside    (Md.).  408. 

Accord   and    satisfaction    (N.    Y.),    722. 

Denial  of  liability   not   waived  by    (S.  C),  859. 

Will   not   be   set  a.sidc   before   tender  back  of   payment    made    (S.  C.l.  862. 

Wliat  required  to  set  aside   (Wis.),  1029. 
CONDITIONS  PRECEDENT: 

Payment  of  first  premium   wliile  in  good  health   (Ark.),  23. 

To  fixing  of  liability   (Conn.).  70-71. 

Agent's    agreements    (Iowa),    285. 

To   liability    (Iowa),  289-290. 

Pleading  performance  of,  required  in  action  on  certificate   (Kas.i.  313. 

To  liability   (Kas.),  327. 

Medical   examiner's  approval  of  application   (Miss.),  550. 

Unauthorized   delivery   of   certificate    (Neb.),   645. 

See  Contracts  ami  Liability. 


INDEX  1069 

CONFLICT: 

In   laws  of  society    (Mirli.),  401. 

Between  certificate  and  laws   (Mo.),  (iOl. 

In    laws;    tliose  of   Jlissouri    <;overn    I. Mo.).   .502. 

In   ]irovisions   of  contracts    ('I'enn.),  "JU'J. 

Jn   laws;    liow   construed    (Texas),  928. 
CONNECTICUT: 

Statute  relatinj;  to  fraternal  societies,  C3-69. 

Fraternal  society,  definition  of,  63. 

Benetit  and  ex))ense  funds  to  be  derived  from   assessments.  03. 

Class  of  benelieiaries,  G3. 

Fraternal  associations  exempt  from  provisions  of  ;;eneral   insnra)iee  laws,  63. 

Provisions  under  which  societies  may   do  business,  63-(!4. 

Status  of  foreign  societies,  64. 

Must  file  annual  report  with    insurance   eomniissioner.  (14-i;.>. 

Must  file  certified  copy  of  charter  or  articles  of  incorpnral  inn.  and   copy  of 
constitution   and   by-laws.  64. 

Must  appoint  Insurance  Commissioner  its  attorney,  04. 

Insurance   commissioner   shall    examine   into   condition   and   management   of 
society,  04.  65. 

Insurance  commissioner  ma}'  permit;  fee,  66. 

Neglect  to  file  reports;   penalty;   injunction,  06. 

Money  due  from  society  exempt  from  attachment  for  debt,  67. 

No  society  shall  employ  paid  agents  except  in  organizing  local  branches  or 
lodges,  67. 

False  representations  in  applications  for  membership,  etc.;  penalty,  67. 

Acting  for  unatithorized  society;  penalty,  67-68. 

Masons.  Odd  Fellows,  etc.,  not  included  in  provisions  of  this  chapter,  08. 

Insurance  Commissioner  shall  publish  annual  reports,  68. 

Fees  payable  to  Insurance  Commissioner,  08-69. 

Transaction  of  such  business  by  other  societies  or  persons  than  above  pro- 
vided,   forbidden.    69. 
CONSOLIDATION  OF  SOCIETIES: 

Transfer  of  membership  to  another  society    (111.),  168. 

Risks   assumed    (Iowa).  291. 

Eights  of  old  members  after   (Iowa),  292. 

Ultra  vires  contracts   (Kas.),  318. 

Contracts  assumed;  original  provisions  continued   iMe.l,  .390. 

When  unlawful    (Texas),  041. 
CONSTITUTION: 

Amendments   to    (D.   C),  97. 

Illegally   adopted   (D.  C),  98. 

May  be  waived  same  as  by-law-   (111.),  171. 

A    mere    by-law    (111.),    194. 

Is    a    mere   by-law    (Miss.),   5.56. 
CONSTITUTIONAL  LAW: 

Title  to   statute    (ilich.).   492. 

See  Laws  and   After-Enacted  Laws. 


1070  FRATERNAL    SOCIETY   LAW 

CONSTRUCTION: 

Of  contracts  by  societies  not  binding  on  courts  (Ala.),  9. 
Of  exempting  statute   (Conn.),  71. 
Of  ambiguous  designation  of  beneficiary  (111.),  165. 
Of  Missouri  fraternal  beneficiary  act    (111.),  184. 
Of  fraternal  beneficiary  act  of  1893   (111.),  195-190. 
Of  contracts  to  favor  purjjoses  of  society  (111.),  1(>0. 
Of  Missouri  statute    (111.),  184. 
Of   contracts   must    favor   member    (111.),   180. 
Of  doubtful  contracts   (Iowa),  275-276. 
Of  ambiguous  contracts   (Me.),  380. 
Of  warranties    (Minn.),  520. 

Of  contract  to  be  liberal  in  fa\or  of  members    (Miss.),  550. 
Of  statutes;  long  established  customs  aid  in  (Mo.),  578. 
Conflicting  rules  in  different  States   (Mo.),  597. 
Of  contract  must  favor  member  (Mo.),  593. 
Of  statutes,  custom  as  aid  to   (Mo.),  578. 
Of  doubtful  language  in  contract   (Xev.),  658. 
Of  ambiguous  contract   (N.  Y.),  728. 

Reasonable,   of  laws   to  carry   out  meaning  proper    (R.   I.),  85T. 
<-!f   conflicting   provisions   in    contract    (Tenn.),    909. 
Of  conflicting  laws    (Texas),  928. 
Of  ambiguous   laws    (Utah),  949. 
CONTRACTS: 

Societies'  construction  of.  not  binding  on  courts   (Ala.),  9. 

Ultra  vires,  if  to  repay  to  member  what  he  has  paid  in  (Ala.),  7. 

Parol   (Ark.),  27. 

Failure   to  pay   promptly    (Ark),   20. 

None  where  apjilicant  fails  to  become  initiated   (Ark.),  25-26. 

Not  effective  until  payment  of  first  premium  (Ark.),  23. 

Effect   of   suspension  of  lodge   on    (Ark.),  22. 

Of  insurance,  not  character  of  company  determines  rights   (Ark.),  22. 

Oei'tificate  held  to  be  an  Arkansas  contract   (Ark.),  21. 

Liabilit}-  on  bond  to  State  predicated  on   (Ark.),  20. 

Garnishment  of  society's  funds  defense  to,  action  on   (Ariz.),  29. 

Situs  of,  and  suit  on  (Ai'iz.),  29. 

Ultra  vires,  what  are   (Cal.),  48. 

By-laws,  rules  and  regulations  part  of   (Cal.),  47. 

Effect  of  new  charter  on   (Cal.),  38-39. 

After-enacted  by-laws   cannot   reduce   anunnit   payable   under    (Cal.),  40-41. 

Determined  solely  by  the  laws  (Cal.).  35. 

By-laws  are  part  of  (Cal.),  33. 

Forfeiture  for  non-payment  of  assessments   (Cal.),  32. 

Effect  of  failure  to  complete  application  for   (Colo.),  01-02. 

Conditions  precedent  to  liability  luider   (Conn.),  70-71. 

Between  members  and  society. — Certificate  need   no(    be    issued    (Ga.),   107. 

Must  be  in  writing  (Ga.),  107. 

Repudiation  of,  by  society  (Ga.),  111. 


INDEX  1071 

CONTRACTS— Continued : 

Waivers   not  allowod    (Hawaii),   12'J. 

Chaiiffcd    by    aftei-cnaeted    laws    (111.).    103-104. 

Waiver  of  provisions  of   (111.),  103. 

Capable  of  two  constructions  must  be  held  to  favor  beneficiary  (111.).  101. 

Obligations   under,   not   increased   by   society   taking   benefit   of   State   laws 

(111.),   161. 
What  State  laws  are  part  of   (111.),  161. 
Construction  to  favor  purposes  of  society  (111.),  160. 
Of  promoters  not  binding  on  society  (111.).  102. 
Includes    laws    of   subordinate    lodge    (111.),    101. 
Keforniation  of.  after  member's  death    (III.).   ISS. 
Impairment   by   nfler-enacled  law-    (111. I.   IS7. 
When   regarded   as   an   Illinois   contract    (Ill.i.   1S7. 
Construction  of,  must  favor  members   (111.),  ISO. 
Ultra   vires   plea   not   available   when    performed  anil   in   rlunter   puwer    illl.i. 

171. 
Ultra  vires  cannot  be  ratified  (lib).  10l)-170. 
Ultra   vires,   neither   party   estopped    to   assert    (111.).   10!t. 
Affected   by   after-enacted   laws    (III.),   100. 
Construction   of  doubtful    (Iowa),  •27-5-270. 
Strict    construction   required    (Iowa).    277. 
To  employ   paid  agents,   ultra   vires    (lowai,   27'J. 
By  promoters   (Iowa),  279. 

For  in-definite  amount,  action  on   (Iowa),  298. 
Conditions    precedent   to   liability    (Iowa),   297. 
Ultra  vires  in  consolidation  of  two  societies   (Iowa),  292. 
Assumed  in  consolidation  of  two  societies   (Iowa),  291. 
Conditions    precedent   to    liability   under    ( Iowa ) ,   289. 
Copy  of  application  to  be  attached  to  certificate  (Iowa).  289. 
Advertising  which  induced  membership  not  part  of   (Iowa),  280. 
Certificate   need  not  be  issued    (Iowa),  284. 
Valid  though  delivery  not  shown    (lovVa),  285. 

Special:   members  cannot  sue  to  prevent  issuance  of,  by  society    (Ind.),  230. 
Death  before  same  became  binding  (Ind.),  234. 
Laws  are  part  of   (Ind.),  236-237. 
Rescission  of   (Ind.),  247. 

Incontestable  clauses  and  amendments  of  (Ind.),  248-250. 
Validity  of,  where  society  is  not  licensed  (Ind.),  228. 
General  and  limited;   death  from  expected  cause   (Ind.),  227. 
When  ultra  vires  (Kas.),  318. 
Parol  evidence  as  to  (Kas.),  312. 
Beginning  of   liability    (Kas.),  311. 
Where  no  provision  against  suicide    (Ky.),  334-335. 
Entire  contract  req\iired  to  be  contained  in  certificate   (Ky.).  334. 
Must  contain  complete  exhibit  of  all  parts  referred  to  or  relied  on   (Ky.).  332. 
Time  when  liability  begins  under  (Ky.),  332. 
Void:    return   of  assessments    (Ky.),   332. 


1072  FRATERIiAL,    SOCIETY    LAW 

CONTRACTS— Continued: 

Wliat    constitutes    (Mass.),  440-441. 

Breac-li  of,  by  after-enaoted  laws  (Mass.),  447. 

Conditions  precedent  to  liability  under   (Mass.),  44«. 

Certificate  issued  in  New  York  a  Maryland  contract   (ild.),  413. 

Rules   of  construction   (Md.),  413. 

^Vhat  State  laws  govern   (Md.),  415. 

Renewal  of,  subject  to  old  conditions   (Me.),  386. 

Construction   of   ambiguous    (Me.),   386. 

Assumed  in   consolidation    (Me.),   390. 

Unlawful,  payments  made  in  good  faith  on    (Midi.),  486. 

Payments  made  on,  ultra  vires   (Midi.),  489. 

When  a  Michigan  contract   (Mich.),  467. 

For  cash  benefits   (Mich.),  468. 

Laws  of  society  of  more  force  than  certificate   (Miss.),  555. 

To  be  liberally   construed  in  favor  of   the  insured   (Miss.),  550. 

Cannot   be  made  against  estoppel    (Miss.),  550. 

Conditions  precedent   (Miss.),  550. 

Minds   of   parties   must   meet    (Miss.).  552. 

Laws  of  society  are  considered  written  into  (Miss.),  552. 

Conditions  precedent  to  (Minn.),  516. 

When  void,  payments  forfeited  (Minn.),  521. 

Defeated  by   false  answers  in  application    (Minn.),  523. 

From   what  deducible    (Minn.),  524. 

Statute  in  force  at  maturity  of,  determines    (Mo.),  606. 

Of  a  fraternal  society  subject  to  forfeiture   (Mo.),  577. 

Nature  of,  determines  character  of  society    (Mo.),  581. 

When  regarded  as  made  in  Missouri  (Mo.),  582. 

Amount  presumed  to  be  due  under    (Mo.),  583. 

Not  afl'ected  by  after-enacted   laws,  when    (Mo.),  587. 

Determines  true  character  of  society    (5Io.),  592. 

Must  be  construed  fa\orab]e  to  member   (Mo.),  593. 

Determined  by  status  at  deatli  of  member   (Mo.),  593. 

Rule  as  to  conflicting  interpretation  in  different  States   (Mo.),  597 

Who  is  real  party  in  interest  in  suit  on  (X.  M.),  659. 

Construction  of   doubtful  language    (Nev.),   658. 

What  composes   (Neb.),  655. 

Duty  to  tender  back  payments  made   (N.  D.),  769. 

Void  under  statute;   no  estoppel  in  pais   (N.  D.),  770. 

What    composes    (N.    D.),    770. 

Cannot  be  destroyed  by  after-enacted  laws   (N.  C),  747. 

Damages  for  breach  of  (N.  C),  747. 

Measure  of  damages   for  cancellation  of    (N.   C.),  750. 

Measure  of  damages  for  breach  of  (N.  C),  750. 

When  it  take*  effect  (N.  C),  751. 

Members  charged  with  knowledge  of  provisions  of  (N.  C),  755. 

Courts  will  take  judicial  notice  of  forms  of   (N.  C),  755. 

Cause  of  action  accrues  upon  repudiation  of  (N.  J.),  692. 


INDEX  1073 

CONTRACTS— Continued : 

Upon  lepudiiitiuM  iiiciiilKT  lias  cause  of  action  tor  tUunages  (N.  J.),  G93i 

Precedent  conditions  dissolved  by  repudiation   (X.  J.),  693. 

How  far  affected  by  after-enacted  laws    (N.  Y.).  710. 

With  foreign  society   may  be  New  York  contract    (X.  Y'.i.  721. 

Provisions  respecting  agency   (N.  Y".),  727. 

Wlien   ambiguous,   slinuld    be   construed   ))iost    strongly   against   the   society 

(N.   Y.),   72S. 
Rights  under,  how  measured   iX.  Y.),  731. 
Delay  of  subordinate  lodge  in  forwar<ling  applicaticjii  does  not  create  (Okla.), 

811. 
Knowledge  of  terms  presumed  (Okla.),  811. 

When  liability  begins;  worthless  check  not  payment  of  premium   (Pa.),  835. 
When  liability  Iiegins  under   (Pa.),  840. 
Copy   of  application  to  be  attached  to    (Pa.),  844. 
Medical  examination  not  part  of   (K.  I.),  851. 
When  agreement  for,  is  merged  into    (R.  I.),  8.53. 
When  begins   (S.  C),  864. 
Unreasonable  delay  in  jiassing  on  application  does  not  amount  to  acceptance 

(S.   D.),   880. 
Conditions  in  certificate  govern    (Tenn.),   890. 
What  constitutes   (Tenn.),  902. 

Certiticate  issued  after  applicant's  death,   void    (Tenn.),  907. 
Of  what  composed    (Tenn.),   908. 
Delay  in   acting  upon  application    (Tenn.),  908. 
Construction  of  conflicting  provisions  (Tenn.),  909. 
Situs  of;  what  laws  govern  (Tex.),  924. 
Situs  of;  where  made   (Texas),  924. 
What  State  laws  imported  into   (Texas),  926. 
When   renounced,  other  party   may   at   once   sue    (Texas),  939. 
Repudiation   of.   gives   right    to   suit    under    (Texas).   939. 
When  provisions  to  be  construed  most  strictly  in  favor  of  beneficiary  (Texas), 

945. 
Repudiation  of;  right  to  sue  (Va.i.  974. 
Repudiation   of;    suit   on    (Va.),   976. 
W'hat  is  life  insurance   (Va.),  977. 
Style  of  type  to  be  printed  in  (Va.),  978. 
Situs  of   (Vt.),  958. 
Construction  of   (Vt.),  960. 

Provisions  in,  against  waivers  not  valid   (Wash.),  991. 
Stipulations   against   agency    (Wash.),   994. 
Parol  agreements  not  competent  evidence   (W.  Va.).  1000. 
Rule  as  to  situs  of  (W.  Va.),  1002. 
Oral  agreement  valid    (W^yo.),   1037. 
Delivery  of,  required   (Wyo.),  1037. 

Recovery   of   premiums    paid   under   void    (Wyo.),    1037. 
CORONER'S  VERDICT: 

Not  prima   facie  evidence  of   suicide    (Ark.).   19. 


1074  FRATERNAL    SOCIETY   LAW 

CORONER'S  VERDICT— Continued: 

Adiiii.s.-^ilile   ill    evidence    (Hi.),    174. 

Not   binding  on  beneficiary    (Ind.),  250. 

In  suicide  cases    (Iowa),  291. 

In  suicide  case   (Ky,),  334. 

Not  admissible  in  evidence   (Neb.),  G.55. 

Not  receivable  in  evidence  (Ore.),  820. 

Not  receivable  in  evidence    (S.   D.),   881. 

Not  competent  evidence    (Texas),   940.  926. 
CORPORATE  POWERS: 

See  Powers. 
COURSE  OF  DEALING: 

See  Custom. 
COURTS: 

Not  bound  by  society's  construction  of  contract   (Ala.),  9. 

Will  not  interfere  with  society's  policy  (Cal.),  47. 

.Jurisdiction  of,  as  between  member  and  lodge  (Cal.),  44.  40-47. 

•Jurisdiction  over  membership  (Cal.),  39. 

Jurisdiction  of.  in  controversies  between  iiieiiibers  and  siiciety    (Cal.),  37,  39. 

Eesort  to   (Conn.),  69-70. 

Resort  to  (Del.),  83. 

Eesort  to.  for  the  maintenance  of  good  standing  (D.  C).  09. 

Jurisdiction  of,  over  foreign  society   (D.  C),  99-100. 

Beneficiaries  not  required  to  resort  to    (Ga.),  112. 

Resort  to  (Ga.),  109. 

Members  may  resort  to   (Hawaii).  128. 

Right  to  resort  to,  not  to  be  denied  beneficiary  (111.),  181. 

Municipal  Court  of  Chicago;   limited  powers   (111.),  160. 
Jurisdiction  of;  where  societies  may  be  sued   (Iowa),  267. 

Provision  in  certificate  limiting  venue  not  valid   (la.),  2(iS. 

Suit  may  be  brought  in  any  county  where  loss  occurred  (la.),  268. 

Action  at  law  proper  on  certain  indefinite  contracts   (la.),  298. 

Resort  to   (Iowa),  288. 

Members  must  exhaust  remedies  in  society   (Iowa).  283. 

Resort  to   (Ind.),  238. 

Situs;  conflict  of  jurisdictions;  void  procedure  (Kas.),  319. 

Judicial  notice  of  foreign  statutes  by   (Kas.),  329. 

Resort  to.  before   exliausting  remedies  in  society    (Kas.),'  324. 

Duty  of  members   to  exhaust  remedies  in  society    (Kas.),  317. 

Right  of  beneticiarv    to  appeal   tn  civil   courfs    (Md.).  409-410. 

Resort  to,  by  beneficiary    (Md. ).  411. 

Courts  are  without  power  to  control  internal  afl'aiis  of  foreign  society  (Md.), 

413.  414. 
Exclusive  jurisdiction    in  society's  tiilmnals   (Md.).  417. 
Resort  to   (Mich.).  493. 

Proceedings   of   society's   trilniinils   not   conclusive    i^lich.),    4S0. 
Resort  to  civil   (Mich.),  483.  490. 
Resort  to  civil    (INIich.).  492. 


INDEX  1075 

COURTS— Continued: 

iti'-oii  tn  civil  (jiii'ii.j,  -tr.s. 
Kc'Miii    I,,  civil   (MiiiM.),  517. 

I'm ciisdHiililo  rfiipiirciiients  of  society's  by-laws   {l\iiiiii.),  517. 
j;c>ciit    tn  civil    (Minn.),  518. 

Unieasoiiiilile  provisions  in  bylaws   (Minn.),  51!). 
Mcnibcis  must  exhaust  remedies  in  society    (Miss.),  550. 
Courts  should  not  interfere  with  societies  (Mo.),  007. 
UnreiLHOiuible  restrictions  against  resort  to   (Xcb.),  (140. 
Kesort  to   (N.  H.),  C74. 
Kesort   to:    void   lodge  trial    (N.  J.),   086. 

jMonilicrs   must  exhaust  society's  remedies  before  resortin<^  to    (N.  .1.),  085j 
Finality    of    judgments    of   society's  tribunals   (N.  J.),  688. 
Courts   Ikwc  right   of  review  where  contracts   involved   (N.  J.),  (i!l7. 
Kesort   to.  before  remedies  exhausted  in  society   (Ore.),  820. 
Member  must  exhaust  society's  remedies   (Pa.).  S47. 
Kesort    to   civil   courts   permissible    (U.    1.),  850. 

AVheu    authorized    to    interfere    with    societies'    internal    alVairs    (1!.    l.|.    S5U. 
Members'  riglit  to  resort  to    (R.  I.),  854. 
Resort   to    (S.  C),  865. 
Over  foreign  societies    (Tenn.),  1)12. 
Right  of  resort  to   (Utah),  048. 
Review  of  expulsion  of  members  (Wash.).  OOo. 
Resort  to,  by  members  (Wis.),  1020. 
EtVect    (if   void   judgments   on   appeals    (Wis.).    1023. 
How    far   .societies   are   free   from   judicial  control    (Wis.),   1024. 
Sec  Juri.sdiction  and  Trials. 
CREDITORS: 

Wlicn    |)refcrenee   allowed    (Cal.),   .30. 

Riglit  of  attachment   (Cal.),  36. 

Right  of.  as  beneficiaries   (Del.),  83-84. 

May  enforce  in  equitj'  assignment  of  benefit   fund   (111.).  178. 

^lay  enforce  assignment  of  beneficiary's  claim    (111.).  179. 

Ei|uitablc  rights  of,  to  benefit  finid  enforceable   (111.),  108. 

Rights   to  benefit  fund  enforced   in   equity    (111.).   188-189. 

Rights  to  fund,  when    (111.),  190. 

Claims,  benefit  fund  exempt  from   (Kas.),  325. 

Assignment    of   benefit   fund  to    (Mass.),  450. 

Claims,  benefit  exempt  from   (Md.),  411-412. 

Right  to  benefit  fund   (Mich.),  475. 

Trust    agreement    in    favor    of    (Mich.),    407. 

Claims  on  benefit  fund  (Miss.),  555. 

Riglits  of,  as  beneficiaries    (Mo.),  607. 

Cainiot  be  beneficiaries  (Neb.),  034. 

Cannot  take  funds  (Neb.).  037. 

Cannot  enforce  claims  against  benefit  funds   (N.  Y.),  714. 

AVlien  may  take  benefit  funds   (N.  Y.),  727. 

Rights  of,  as  beneficiaries   (Pa.),  840. 


1076  FRATERNAL    SOCIETY    LAW 

CREDITORS— Continued : 

lJ^■lK•ti^•iiU■it■^  are,  atter  niaturit}-  of  certificate    (I'a.).  843. 

Kiglits  of  local  vs.  foreign   (Pa.),  843. 

Right  of,  as  to  assessments  paid    (Texas),  942. 

Cannot  attach  fund   (Texas),  925. 

Scf  Attachment  ^ni.l  Garnishment. 
CUSTOM: 

Cannot   waive   vvritten   contract   terms    (Ga.),   108. 

Does  not  estop  society  from  enforcing  its  laws  (Ga.),  109. 

Course  of  dealing   in   collecting  assessments    (Iowa),  290. 

As  to  receiving  members'  payments  (Kas.),  315. 

Of  receiving  payments  (Mich.),  489. 

Estoppel   under    (Minn.),   532. 

Does  not  waive  laws   (Minn.).  .530. 

Cannot  waive   laws    (Minn.).  520. 

May  waive  laws;  rule  as  to  (Mo.),  595. 

As  to  suspension    (Mo.  I.  U(H). 

What  is   (Pa.),  848. 

And  course  of  dealing,  efl'ect  of  (Tenn.),  911. 

In  dealings  as  waiver  of  laws    (Tenn.),  909. 

AVaiver  of  right  of  forfeiture  by   (Tenn.),  905. 

And  course  of  dealing  not  to  waive  laws  (Va.l.  974. 

As  a  cause  for  waiver  (Vt.),  958. 

And  course  of  dealing  (Wash. I.  998. 
DAMAGES: 

Fraternal  society  liable  for,  caused,  by  negligence  of  its  surgeon   (Cal.),  37. 

For  injuries  received  during  initiation   (Mich.),  474. 

None  recoverable  for  inability  to  secure  insurance  (Mo.),  579. 

Pleasure  of,  where  contract  wrongfully  cancelled  (N.  C),  750. 

^Measure  of,  for  breach  of  contract  by  society  (N.  C),  747. 

Members  acting  in  judicial  capacity  not  liable  for  (N.  H.),  675. 

For  injuries  to  member  inflicted  during  initiation    (N.  Y.),  716. 

Eecoverable  for  injuries  during  initiation   (S.  C).  863. 
DEATH: 

Of  beneficiary  before  member  (Ga.),  108-109. 

Before  contract  became  binding   (Ind.).  234. 

From  excepted  cause;  general  contract  and  limited  liability  (Ind.j,  227. 

Death  by  own  act,  when  suicide   (La.),  362. 

From  opiates;  .overdose  from  accident  does  not   exempt  society    (Mo.),  604. 

Evidence  of  identity  of  body  (Pa.).  S30. 

Of  applicant  before  issuance  of  certificate   (Tenn.),  907. 

Of  beneficiary;  wlio  entitled  to  fund    (Tenn.).  912. 

For  deaths  in  common  disaster,  see  Common  Disaster. 

For  deaths  in  violation   of  law,  see  Violation  of  Law. 

For  deal  lis  proofs,  see  Proofs  of  Death. 
DEBTS: 

Tlcnelit    fund  is  exempt   fnini    (Ill.i.  178.  190. 

For  liabilitv  for,  see  Creditors. 


INDEX  1077 

DEFINITIONS: 

Of   >alooii-kecper    (Ala.),   12-13. 

Of  lieirs  at  law   (Ark.),  23-24. 

Of  dower  (Ark.),  23-24. 

Of  good  .standing   (Conn.),  69. 

Of  death   in   violation  of  criminal  law    (Ga.),   117. 

Of  family   (Ga.),  IIG. 

Of  organic  law  (111.),  171. 

Of  '•commit  suicide"  (111.),  172. 

Of  satisfactory  proofs  of  death  (111.).  174. 

Of  estoppel   (III.),  175-176. 

Of  total  disability    (III.).   176. 

Of  insane  impulse  (111.).  172. 

Of  good  health   (111.),  168. 

Of  suicide,  sane  or  insane  (Ky.).  33.5. 

Of  a  charity  (Me.),  388-389. 

Of  orphans  (Minn.),  523. 

Of  living  issue  (Minn.),  525. 

Of  waiver  (Miss.),  554. 

Of  duel  (Mo.),  559. 

Of  fraternal  society  (Mo.),  598. 

Of  level  rate    (Mo.),  579. 

Of  fraternal  society  (Mo.),  577. 

Of  family   (Mo.),  605,  608. 

Of  heirs  at  law   (Mo.),  604. 

Of  paralysis  (Mc),  603. 

Of  good  health   (Mo.),  001. 

Of  solvent  society    (Mc),  639. 

Of  self-destruction  (N.  J.),  772. 

Of  estoppel  and  waiver  (N".  Y.).  730. 

Of  heirs   (N.  Y.),   725. 

Of  estoppel   (R.  I.),  855. 

Of  warranty  (Texas),  924. 

Of  fraud  and  breach  of  warranty  (Vt.),  957. 

Of  illness  (Vt.),  957.  960. 

Of  saloon-keeper  and  bartender   (Wis.),  1028. 

Of  legal  heirs    (Wis.).  1028. 
DELAWARE: 

Statute  relating  to  fraternal  societies,   74-82. 

Duties  of  Insurance  Commissioner,  74-75-70. 

Society  must   file   annual   statement.   76-77. 

Insurance  company,  definition  of,  77. 

Fee  for  filing  annual  statement,  77. 

Charter  or  declaration   of   organization   to   be   filed    with   insurance  Commis- 
sioner,  78. 

Must  file  certificate  appointing  agent  on  whom  process  may  be  served,  78. 

Soliciting  business   for  any   company  not  authorized   to   transact  business; 
penalty,  78. 


1078  FRATERNAL    SOCIETY    LAW 

DELA  wfAEE— Continued : 

Agent    -.I.;  >1   |iri>ciire   iioense   from  Insurance  Commissioner,  78. 

Seal  (  f  Insurance  Commissioner  on  certificates  and  official   ])apers,  78. 

Papers  or  copies  of  papers  so  sealed  to  be  received  in  evidence,  78. 

False  swearing  by  officers  or  agents;  penalty.  79. 

Violation  of  law;  penalty,  79,  80. 

Fees  payable  to  insurance  Commissioner,   79-80. 

Salary    of   Insurance   Commissioner,   80. 

Of  liis  clerk,  80. 

Revocation  of  license,  79,  80. 

Appointment   of  Insurance  Commissioner   as  attorney.  81. 

Insurance   Commissioner,  when   served  with   jnocess,  shall   ujail  copy   to  sec- 
retary of  company,  81. 

Funds  shall  not  be  diverted  for  political  purposes;   penalty.  81-82. 

Production  of  books,  papers,  etc.,  in  court,  82: 

Such  books,  papers,  etc.,  not  to  be  used  against  such  person  in  any  criminal 
proceeding,  82. 
DELEGATION: 

Of  legislative  powers   (111.),  193;    (Jliss.),  5.55. 

See  Powers  and  Society. 
DEPENDENTS: 

Who  are   (Ala.).  8. 

Who  are  not    (Cal.),  33. 

Dependency    of    beneficiaries    (Hawaii).    129. 

Adopted  child   is    (111.),   105. 

Dependency,  who  are   included   in    term    (lll.l.   liiO. 

Who  are  (Ky.),  337. 

Who    are,   and   what   constit\ites  dependency    (JIass.).   444. 

Statutory'  meaning  of  dependency   (JIo.),  605. 

Harried  adult  son  is  not  (Mo.),  003. 

A  brother  of  member  not  a  dependent    (Ohio),  794. 

What  is  dependenc}'   (Tenn.),  905. 

Who  are   (Texas),  929. 

Rule   as   to   evidence   of   dependency    (Wash.),   99G. 
DIRECTORS: 

Amendments  of  laws  by    (ilinn.).  529. 
DISABILITY: 

Statute  construed   (Cal.),  48. 

Definition  of  total   (111.).  176. 

Total,  what  is   (Ind.).  240. 

Payments  accruing  during    (Jlich.l.  487. 

Wnien  total   (Mich.),  477. 

Benefits,  claim   for   (Jlich.).  468. 

What   is   total    (N.  H.),  674. 

What    is    (Texas).  943. 

Benefits,  right  to  (Texas),  932. 
DISAPPEARANCE: 

See  Absence. 


I 


mDEX  1079 

DISCRIMINATION: 

lictwiTii    iniMiilicrs    iCiil.l,   30-:)l. 
DISPUTES: 

r.clwccii  iiiriiiliois  iuid  lodpi'    (CmI.).  44. 
DISTINCTION: 

liclwccii    iriiiliial    :iii(l    fi;il  el  mil    socii'ties    (Ark. I.   U.'). 
DISTRICT  OF  COLUMBIA: 

Statute  rolatinir  to  fraternal  societies,  85-97. 

Fraternal    society    defined,    85. 

Soeiety   may  create  and   maintain   a  reserve,  emergency   or  benefit  fund.  85. 

May  pay  withdrawal  benefits  not  exceeding  dues  ])aid  by  member,  85. 

Benefit  fund  to  be  derived  from  assessments  and  dues.  85-80. 

Beneficiaries,  class  of,  86. 

Fraternal  societies  exempt  from  in.suranci-   laws,  8(i. 

May   continue  lousiness   subject   to  ]novisions   of  statute.  80. 

Must   file   with   Superintendent   of   Insurance   copy   of  charter,  articles  of  in- 
corporation  and   by-laws,   80-87. 

Foreign   society   must   be   authorized   to   do   business   in   State   where   incor- 
porated, and  file  certificate  to  that  effect,  87. 

Superintendent  of  Insurance  may   examine  into  allairs  of  society,  87. 

Expenses  incident  to  such  examination  to  be  paid  by  society,  87. 

Annual  report  to  be  tiled  with   Superintendent  of  Insurance,  87-88-89. 

Appointment  of  Superintendent  to  act  as  attorney ;  service  of  process,  89-90. 

Permit  from  Superintendent  of  Insurance.  90. 

Organization  of  societies,  90-91. 

Reincorporation    of    societies,    92. 

Incorporation    of    subordinate    bodies,    92-9.'!. 

Pa.yment  of  assessments  by  beneficiary   invalidates  contract,  93. 

Benefits  exempt  from  attachment,  93. 

Jleetings  of  Supreme  Lodge,  93-94. 

Fraudulent  representations  in  applications  for  member^liip.  etc.,  94. 

Failure  to  make  reports;  penalties,  94-95. 

Fraudulent  conduct  of  business,  etc.;   injunction:  reinstatement,  94-95. 

Officers  or  agents  acting  without   authority  or  in   violation  of  statute;   pen- 
alties, 95. 

F'raternal    beneficiary    code    due-    not    apjily    to    corporations    organized    for 
profit,  90. 

Nor  to  associations  or  indiviihials  using  name  of  previously  existing  corpora- 
tion,  90. 

Person   guilty   of   murder   or    manslauglitcr   cauiuit    be   beneficiary   of   person 
so  killed,  96-97. 
DIVIDENDS: 

Fraternal   societies   cannot    pa.v    (Minn.),   514-515. 
DIVORCE: 

(If  wife  where  named  as  beneficiary   (Cal.),  41. 

or  benefieiary,  efleet  of  (Cal.),  41-42. 

Effect  of  wife's  when  named  as  beneficiary   (Colo.).  01-02. 

Effect  of,  on  beneficiary    (Iowa),  283-284. 


1080  FRATERNAL    SOCIETY    LAW 

DIVORCE— Continued: 

Divorced  wife  eonipeleiit  as  beneficiary   (Iowa),  297. 

Ot   wife  named  as  beneliciaiy;   etTeet  of    (Pa.),  839. 
DOMESTIC  SOCIETY: 

Treated  same  as  foreign  (Mo.),  59;}. 
DOWER: 

Detiiiitiun  of   (Ark.),  23-24. 
DRUGS: 

U.se  of.   to  suicide    (iJinn.),  515. 

EeekleN5  tise  of,  same  as  suicide    (Tenn.),  910. 

See  Suicide  and  Habits. 
DUEL: 

Definition   of    (Mo.),  599. 
DUES: 

See   Assessments. 
ENDOWMENTS: 

Fraternal   societies   cannot   give    (Minn.),  514-515. 
EQUITY: 

Certiticate  assignable  in   (111.),  188-189. 

Equitable  rights  to  benefit  fund  may  be  enforced   (111.),  198. 

See  Assignment,  Creditors,  Beneficiaries. 
ESTATE: 

Uf  member  not  entitled  to  benefit  fund  (Neb.),  637. 

Benelit    fund   not    part   of   member's    (111.),   198. 

See  Beneficiaries. 
ESTOPPEL: 

Affeptanee  of  arrearages  does   not   work,  wliere  good   health  necessary  and 
not  shown  (Ark.),  20. 

False  statements  made  in  a])i)licati<)n  by  agent   (Cal.).  34. 

In  case  of  amended  laws  (Colo.),  55. 

In  cases  where  tenders  not  repeated  (Colo.),  58. 

By  "acts  of  local  otficia,ls  (D.  C),  98. 

Cannot  be  claimed  from  custom   (Ga.),  108. 

Society   not   estopped   by   acts    unauthorized    (Ga.).    109. 

Societj-  not  estopped  by  agent's  unlawful  agreement   (Ga.),  113. 

Society  not  estopped  to  question  designation  of  beneficiary   (Ga.),  114. 

None  under  ultra  vires  contract  (111.),  169. 

Definition  of  (III),  175-176. 

Respecting  change  of  beneficiary  (Iowa),  280. 

From  acts  of  agent  (Ind.),  234. 

By  acts  of  assistant  clerk    (Kas.),  316. 

In  ultra   vires  contracts    (Kas.),  319. 

When  arising  on  waiver  of  warranty  (La.),  365. 

By  negotiations  with  beneficiary   (Minn.),  522. 

By  course  of  dealing   (Minn.),  532. 

Society  cannot  contract  against   (Miss.),  550. 

Surety  company  estopped  from  denying  legal  capacity  of  society  (Neb.).  647. 

In  waiver  and  forfeiture  eases   (Neb.).  643. 


INDEX  1081 

ESTOPPEL— Continued : 

Member  estopped  by  overt  acts   (Neb.),  042. 
When  is  doctrine  applicable?  (N.  D.),  770. 

There  can  be  none  where  contract  is  void  under  statute   (N.  D.).  770. 
And  waiver,  definition  of   (N.  Y.),  730. 

By  failure  of  member  to  exhaust  remedies  under  laws  of  society  (Ore.).  820. 
In  agency  waiver  cases   (R.  I.),  850. 
Definition  of  (E.  I.),  855. 
Upon  waiver  of  laws  by  agents    (Va.),  974. 
Equitable   (W.  Va.),  1001. 
For  waivers  see  Waivers. 
EVIDENCE: 

Coroner's  verdict  to  prove  suicide   (Ark.).  19. 

Burden  of  proof  as  to  reinstatement   (Ark.).  19. 

Proof  of  by-laws  (Ark.),  22. 

Burden  of,  as  to  amount  of  post  mortem  assessment   (Ark.),  23. 

Burden  of  proof  in  suicide  cases   (Ark.),  19. 

Legality  of  marriage  presumed,  and  burden  of  proof   (Colo.),  56. 

Presumptions  of  legality  of  naming  beneficiaries   (Colo.),  57-58. 

Admissions  of  member  binds  beneficiary    (Ga.).  114. 

In   sick   benefit   cases    (Hawaii),   128. 

Privileged    communications    to   physicians    (Ida.).    139-140. 

Books  of  society  not  only  evidence  of  good  standing  (111.),  1G8. 

When  proofs  of  death  are  satisfactory    (111.),   174. 

Coroner's  verdict  admissible  in   (III.),  174. 

Opinions  of  physician  in  suicide  cases    illl.),   175. 

Beneficiary  may  deny  statements  made  in  proofs  of  death    (HI.),  175. 

Burden  of  proof  in  suicide  cases   (111.  I.  170,  177. 

When  member  incompetent  witness   (111.).  183. 

Burden  of  proof  in  death  in  eoninion  disaster  cases   (111.).  ISC. 

Proofs  of  death  admissible  in   (111.),  191. 

Suicide  by   strangulation  proved  from   circumstances    (111.).  158-159. 

Presumptions  and  burden  of  proof   (Iowa),  287. 

Privileged   communications    (Iowa),  292. 

But  little  sufficient  to  rest  verdict  upon    (Ind.).  248. 

Privileged  comnninieations  to  physician    (Ind.).  239. 

Admissions  of  members  not   (Ind.).  232. 

Physician   not   a   privileged   witness    (Ind.),   231. 

Parol,  as  to  contract   (Kas.),  312. 

Circumstantial,  of  suicide   (Ivy.),  334. 

Coroner's  verdict  as  to  suicide   (Ky.),  334. 

Circumstantial,  to  prove  suicide   (La.),  3G2. 

Printed  by-laws  admissible  in   (Md.),  409. 

Privileged   communications    (Mich.),   482. 

Privileged  communications  in  lodge  trials   (Mich.),  480. 

In  interpleader  case    (Mich.),  475. 

New  trial,  what  is  required    (Minn.),  519. 

Waiver  of  exemptions  in  favor  of  physicians  (Minn.).  518. 


1082  FRATERNAL    SdClETY    LAW 

EVIDENCE— Continued : 

Circumstantial,   as   to   Miiiide    (ilinn.l.  :>\7. 

Burden  of  proof  in   suicide  cases    (Jlinii.).  .")27. 

As  to  age;   statements   to  otlier  societies    (Jlinn.).  510. 

Declarations  of   members   inadmissible    (Mo.),   398. 

When   are  claimants  incompetent  witness?      (Mo.),  593. 

Privilege    of   pliysicians    waived    (Mo.),   584. 

When    physician's    opinion    admissible    (Xeb.),    G50. 

Coroner's  verdict  not  admissible   (Xeb.),  Coo. 

Admissions  of  members    (Xeb.),  648. 

Books  of  subordinate  lodges  (Xeb.),  647. 

Proofs  of  death  admissible   (Neb.),  633. 

Privileged  communications   may   be  made   competent    bv  waiver   of  statute 

(X.    C).    749. 
When   insufficient   to   establish   suicide    (X.   .7.),   097. 
Proper  way   to  prove  laws   (X.  J.),  695. 
Burden   as   to   forfeitures    (N.  J.),   691. 
Habitually  disregarded  by-laws   (N.  H.),  674. 
As   to  suicide    (X.  D.),   772. 

Declarations  of  member  admissible    (X.  D.),  772. 
Value  of  proofs  of  death  as    (X.  D.),  771. 
Waivers  nuiking  physicians  competent  void   (X.  Y.),  721. 
Misstatements  in  application   (X.  Y.),  719. 
When  jjroofs  or  death  furnished  by  agent  of  society  is  not  competent  (Ore.), 

820. 
Coroner's  verdict  not  receivable  in    (Ore.),  820. 
Parol  testimony  not  admissible  to  change  contract   (Okla.).  811. 
Relations  between   physician  and  patient    (Ohio),  793. 
Proofs  of  death   prima  facie,  as  to  cause  of    (Pa.),  847. 
Under  breach  of  warranty   (Pa.),  847. 

Agent's  knowledge  of  false  statements  not  admissible   (Pa.).  845. 
Identity  of  insured  (Pa.).  830. 
Agent  competent  witness   (Pa.),  834. 

Parol  agreement  not  admissible  to  defeat  terms  of  contract  (S.  C),  804. 
Coroner's  verdict  not   (S.  D.),  881. 
What  is  competent  as  to  age    (Tenn.).  900. 
As   to  age  and   pedigree    (Tenn.),   900. 
Coroner's  verdict  not  (Texas),  940. 
Coroner's   verdict    not   admissible    (Texas).   920. 
Burden  of  proof  in  suicide  cases   (Texas),  923. 
Members  presumed  to  know  laws  of  society    (Va.),  977. 
Parol  agreements  respecting  insurance  contracts    (Va.).  97(i. 
Secondary,  not  allowed  to  explain  or  waive  medical  exaiiiiriatidii  (Wash.).  999. 
By  non-medical  expert  not  competent   (Wash.).  999. 
What  is  comijctent.  in  warranty  cases   (Wash.),  996. 
Of  dependency    (Wash.).  990. 

Privileged    testimony    of    physician     (Wash.).    992. 
What  required  to  change  written  settlement  (Wis.),  1029. 


INDEX  1083 

EVIDENCE— Continuea : 

Proofs  of  death  as  to  suicide   (Wis.).  1028. 

Admissions  in  suicide  case  (Wis.),  10'25. 

Admissibility   of   dcolarations    (Wis.),    102;). 

Proofs   of  deatli   sliowing  suicide  coinpetont    I  Wis.),   1022. 

Report  by  local  examiner   (Wis.),   1021. 

For  burden  of  proof,  see  Burden  of  Proof. 

See  Privileged  Communications,  Waivers,  Physician  and  Patient. 
EXEMPTIONS: 

Fraternal   societies   exempt   from    iiisuraiiee   laws    (Cal.l.   43. 

From  insurance  laws,  societies  enjoy  (Cal.),  4;!. 

Statute,  construction   of    (Conn.),  71. 

Of  benefit  fund  from  attachment  (111.),  IT.*^.  lOO. 

Of  societies  from  taxation,  unconstitutional   (HI.),  l(i.'>. 

From  insurance  laws  in  favor  of  societies   (Iowa),  284. 

Societies  enjoy,  from  insurance  laws  (Iowa),  277-27S. 

From  taxes  of  property  of  fraternal  societies  (Kas.),  ;i20. 

In  favor  of  societies  from  insurance  statutes   (Mass.),  440. 

In  favor  of   benefit   funds   from   creditors'   claims    (Md.),  411-412. 

In   favor  of  societies  from  insurance  laws    (Mich.),   474. 

Of  funds  from  alimony  claim   (Mich.),  47<i. 

Wlien  benefit  funds  lose  right  to   (Mich.),  473. 

From  general  insurance  laws  in  favor  of  societies    (Mo.).  .580-581. 

Statute    relieving    benefit     funds     from     creditors'    claims,    unconstitutional 
(Ohio),  793. 

From  insurance  laws  in  favor  of  societies   (Ohio),  7i'2. 

From  insurance  laws  in  favor  of  societies    (N.   H.),   117.5. 

From  general  laws  in  favor  of  societies  (S.  D.),  881. 

Statutes    in    Texas    constitutional     (Texas).    !l2(i. 

Of   societies   from   general  statutes    (Texas).   !I44. 

In  favor  of  societies  fi'om  general  laws   (Texas).  1)22. 

FrriMi   taxes  does  not  extend  to  club  liouso   (Wis.),  1027. 
EXHAUSTING  REMEDIES: 

See  Courts. 
EXPERT  OPINION: 

•  If  a  physician  as  to  suicide   (111.),  175. 
EXPULSION: 

Of  member;   setting  aside  verdict  by  court   (Cal.).  'M. 

Of  members  and  lodges:     Unincorporated  >oeiety   (Cal.).  45. 

For  misconduct  justified  (Mo.),  G03. 

Laws  and  procedure  must  be   strictly   followed   (Mo.).  007. 

Liability   of   members   for  prosecuting  member  for  offenses   against  society 
(X.  H.),  675. 

Unlawful;   rights  of  member   (N.  J.),  095. 

liight  of  defense  under  laws  of  society   (X.  J.),  097. 

When   unlawful,  member  may  bring  suit  of  mandamus    (X,  .].).  095. 

Duty  to  exhaust  remedies  under  laws  of  society  (Ore.),  820. 

When  member  can  ask  courts  to  set  aside  (T*a.).  847. 


1084  FRATERNAL   SOCIETY   LAW 

EXPULSION— Continued : 

When  right  may  be  exercised  (Pa.),  842. 

An  incident  to  the  usual  powers  of  societies    (R.  I.),  854. 

Member  entitled  to  notice  of  charges  before   (R.  I.).  85.3. 

Latitude  allowed  societies   (Tenn.),  900. 

Member  may  lose  riglits  though  same  illegal   (Texas),  935. 

Charges  of  a  general  nature  as  basis   for   (Wash.),  996. 

When  reviewable  by  courts   (Wash.),  995. 

E.xpulsion  of  insane  member  (Wash.),  993. 

For  suspensions,  see  Suspension. 

For  trials,  see  Trials. 

For  resort  to  civil  courts,  see  Courts. 
FAMILY: 

What  is,  and  who  are  included  (Conn.),  72. 

Who  are  included   in  term    (Ga.),   115. 

Definition  of   (Ga.),  116. 

Who   compose    (Mass.),   439-440. 

Member  of,  as  beneficiary   (Mich.),  409. 

Stepfather  as  member  of   (Mich.),  475. 

Definition  of:   status  at  maturity  of  contract   fixes  rights    (Mo.).  008. 

Definition   of   (Mo.).  605. 

See   Beneficiary  and    Dependents. 
FIANCEE: 

Rights    of,    as    beneficiary    (Cal.),   42. 
FLORIDA: 

Has  no  fraternal  beneficiary   code.      For  digest  of  cases,  see  page   102. 
FOREIGN  SOCIETY: 

.Meetings  may  be  held  out  of  State  whore  chartered   (Colo.).  54. 

Jurisdiction  over,  by  courts   iD.  C.I,  99-100. 

Rights  of    (111.),  180-187-195. 

Service  of  Summons  on   (Mass.),  445. 

Internal  affairs  of,  cannot  be  controlled  by  courts   (ild.),  413-414. 

Treated  same  as  domestic  (Mo.),  593. 

Suicide  provisions  in  laws  of   (Mo.),  585. 

Requisites  of  pleading  and  proof  as  to   (Mo.),  583. 

Rights  of  (X.  C.I.  7.57. 

(Corporations)    have   rights   onl}-   by   grace    (N.   C),   755. 

Contracts  governed  by  laws  of  North  Carolina  (X.  C),  753. 

Receiver  not  to  be  appointed  for  (X.  C),  752. 

Statute  of  limitations  does  not  run   in   favor  of   (N.  C),  751. 

How  domesticated  (N.  C),  749. 

When  contract  of,  a  New  York  contract  (N.  Y.),  721. 

Right  to  State  license   (Ohio).  791. 

Service  of  process  upon  local  agent  of  (Ore.),  817. 

Right  to  hold  meetings  outside  of  State  of  charter  (Pa.),  842. 

Foreign  societies,  jurisdiction  of  courts  over  (Tenn.),  912. 

Suit  against,  and  venue  of  (Texas).  928. 

Rights  of  (Va.).  07(i. 


INDEX  1085 

FOREIGN  SOCIETY— Continued : 

Si'i  \  ill'   ii|ii>ri    (\\;isli.).   Illl."). 

Sfo  Society  and  Summons. 
FOREIGN  STATES: 

Presuiii[itii)Ms  :is   to  stiitiiU'>  of    (III. I,    171. 

Meetings  held  in   (K;is.  |,  ;j-i(i. 

Courts  do  not  take  notice  of  statuti-.s  of   (Ku.s.)  32!). 

Laws  of.  prcsiiiiicd  to  lie  same  as  tliose  of  Xew  York  OT.  Y.),  732. 
FORFEITURE: 

Of  certifieiite  for  noii  |iavi]iiMit  of  asscs^nu-nts   (.\ik.),  27. 

For  nonpayment  of  assossnient  (Cal.),  43. 

Of  certificate  for  nonpa\  nient  of  assessments  (Cal.)  32. 

For  non-pajnient  of  assessments  (Cal.),  43. 

Members'  property  riglits   (Cal.),  46. 

Case  where  after-enacted  laws  involved  (Colo.),  i>~i. 

For  failure  to  pay  extra  assessments  for  hazardous  occupations  (Colo.),  54-55. 

Reinstatement  (Colo.),  GO. 

No  reinstatement  of  contract  after  member's  death    (D.  C),  100-101. 

Custom;   estoppel    (Ga.).  108-109. 

Promissory  warranty  (Ga.),  114. 

Clauses  not  favored   (Ga.),  115-116. 

By  member's  violation  of  criminal  law  (Ga.),  117-118. 

Of  rights  of  beneficiary  by  murdering  member   (111.).  172. 

Duty  to  use  surplus  funds  to  prevent  (III. I.  ISI. 

■Waiver  of  right  of    (III.),   182. 

When  not  self-executing  (III.).  183. 

And  suspension  (111.),  186. 

Right  to.  waived  by  local  lodge  (III. I.  ISO. 

And  suspension   (111.).  102. 

Waiver  of,  by  acts  of  subordinate  lo.lgc  (ill. I.  107. 

Waivers  by  agents  (Iowa),  294-295. 

Self -executing  provisions    (Iowa),  286. 

Absence  of  collecting  officer  (Iowa),  295. 

Health  certificate;  advance  payments  (Iowa),  278. 

Funds  in  hand  to  be  applied  before  (Iowa),  276-277. 

Waiver  of  (Ind.),  227. 

Waiver  of  grounds  of  (Ind.).  242. 

Waiver  of,  by  agent   (Ind.),  242. 

Waiver  and  estoppel;  prohibited  occupations   ilnd.l.  240. 

Self-executing  provisions   (Ind.),  238. 

Duty  of  court  to  declare  (Ind.),  238. 

Payment  of  delinquent  amount  (Ind.),  230. 

Unreasonable  by-laws    (Ind.).  235. 

Right   to,   waived    (Ind.).   233. 

For  entering  prohibited  occupation;  amended  by-laws  (Kas.),  313. 

Custom  of  receiving  payments    (Kas.),  315. 

Self-executing  provisions   (Kas.)  328. 

Surplus  credits  of  member  in  hands  of  society    (Kas.).  318. 


1086  FRATERNAL    SOCIETY    LAW 

FORFEITURE— Continued : 

Ipso  facto    (Ky.).  .'i.'io. 

Self-executing  provisions   (La.),  3(13. 

Waiver  (Me.),  300-391. 

Payment  of  assessments  after  member's  death    (ild.),  412. 

Waiver  of  (JId.),  412. 

By  change  of  occupation  (ilinn.).  522. 

Xo  waiver  of,  by  negotiations  (ilinii.l.  522. 

For  failure  to  pay  advance  assessments   (Minn.),  532. 

Estoppel  by  course  of  dealing  (Minn.),  532. 

Reinstatement    (ilinn.),    52S. 

Requirements  for  reinstatement  (Mass.),  440. 

No  recovery  for  payments  made  (Mass.),  446. 

AVarranty  (Mass.),  444. 

Waiver  of  (Mich.),  492. 

For  failure  to  make  payments   (Mich.).  489. 

Custom  of  receiving  late  payments  (Mich.).  489. 
Payments  accruing  during  disability   (ilich.),  4S7. 
Retention  of  payments   (Mich.),  483. 

Status   at  death  determines  contract   (Mo.),  593. 

\ATien  misrepresentation  voids  contract;  rule  as  to  pleading  (Mo.),  592. 

Agency  of  local  officer;  waiver  of  laws  (Mo.),  591. 

Requisites  of  reinstatement  (Mo.),  588. 

Requisites  in   pleading   (Mo.),  588. 

For  non-payment  must  be  based  on  agreement   (Mo.),  583. 

Of  member  delirious  when  assessments  due  (Mo.),  580. 

Self -executing  provisions  (Mo.),  579. 

Failure  to  pay  increased  rates  forfeits  contract ;  no  damages  recoverable  for 

inability  to  reinsure  (Mo.),  579. 
Fraternal   society   contracts  not  under   State   non-forfeiture  statutes    (Mo.), 

578. 
Fraternal  society  contract  subject  to   (Mo.),  577. 
Rights  of   wronged  member    (Jlo.),  004. 
Precedent  conditions  to  reinstatement   (Miss.),  554. 
Under  after-enacted  by-laws  valid  (Xeb.),  G55. 
Self-executing  provisions   (Xeb.),  054. 

Receipt  of  dues  and  assessments  from  member  waives  (Xeb.),  054. 
Waivers  of  laws  not  favored   (Xeb.).  653. 
Notice  of  assessments   (Xeb.)   653. 
Self-executing  laws  (Xeb.),  649. 
Collector's  neglect   (Xeb.),  648. 
Waiver  of,  and  estoppel  (Xeb.),  043. 
Waiver  of  (Xeb.).  634,  638,  645. 
By-law-  not  self-operative  (X.  J.),  697. 
Burden  of  showing  at  all  times  (X.  J.),  691. 
Self-executing  provisions   (N.  C),  750. 

When  lodges  required  to  make  payments  to  prevent   (Ore.),  820. 
Self-executing  provisions  for,  valid  (Pa.),  846. 
Reinstatcnu'ut  optional  with  society   (Pa.),  841. 


INDEX  1087 

FORFEITURE— Continued: 

Keinstalement  of  inoniber  (S.  ('.).  Sfio. 

Must  be  pleaded  specially  (S.  C),  S(il. 

Of  charter  of  society;  disposal  of  property   (S.  C.l,  SflO. 

For  failure  to  pay  assessments   (S.  C),  859. 

Waiver  by  coiirsc  (if  dealing  (Teiiii.),  Dll. 

Self-executing    provisions    ('I'cnn.),    !)10. 

Waiver   by   custom   of  dealing    (Tenn.),  900. 

Through  vices  or  habits  (Tenn.),  907. 

Prerequisites  to  enforcing  (Tenn.),  905. 

Waiver  of;  course  of  dealing  (Tenn.),  905. 

No  presumptions  of  legality  as  to  assessments  levied  (Tenn.),  904. 

For  failure  to  make  payments   (Texas),  930. 

Right  of,  must  be  exercised  strictly  (Texas),  932. 

When  duty  of  lodge  to  prevent  by  payment   (Utah).  050. 

Where  right  to,  is  waived  (Va.),,  909. 

Waiver  of  laws;  estoppel   (Va.),  974. 

No  waiver  of  laws  by  custom  of  local  lodge  officers  (\'a.),  974. 

Waiver  and  custom  (Vt.),  958. 

Insane  member  required  to  pay  assessments   (Wash.),  997. 

Application  of  advance  payments  (Wash.),  993. 

No  waiver  by  holding  member's  payment   (W.  Va.),  1002. 

Wlien  receipt  of  overdue  assessments  does  not  waive  (Wis.),  1021. 

Waiver   of   prompt   |iayiiieiit   of   assessments    (Wis.).    1(117. 

For  suspension,  see  Suspension. 
FRATERNAL  SOCIETIES: 

See  Societies. 
FUGITIVE: 

Absence  for  seven  years   (Ky.),  330. 

See  Absence. 
FUNDS: 

Use  of  reserve  (Cal. ).  40. 

Surplus,  rights  of  members  in  (111.),  177. 

Of  fraternal  societies  liable  for  taxes  (111.),  185. 

Duty  to  use  surplus  to  prevent  forfeiture   (111.)   181. 

In  hands  of  society  to  be  used  to  prevent  member's  forfeiture  (Iowa),  276-277 

To  be  kept  separate  by  classes  (Ky.),  336. 

Reserve,  after  enacted  laws  respecting  (Mass.),  441-442. 

Of  local  lodge  not  property  of  society  (Mich.),  487. 

Held  for  mortuary  pui-poses  are  trust   (N.  C).  756. 

Not  subject  to  taxation  (Neb.),  6.50. 

For  moi-tuary  purposes  sacred   (Ncb.l.  643. 

Members'  rights  to  (Neb.),  637. 

Members'  payments  are  trust  funds   (Pa.),  839. 

See  Benefits,  Reserve  Fund,  Taxation. 
GARNISHMENT: 

Of  society's  funds  defense  to  action  on  contract  (Ariz.),  29. 

Of  benefit  fund;  duty  of  society  (111.),  178. 

Funds  after  payment  no  longer  exempt   (!Mich.).  475. 


1088  FRATERNAL    SOCIETY    LAW 

GARNISHMENT— Continued: 

Fund  exempt  from  claims  for  alimony   (Mich.),  476. 
Provision  exempting  benefit  fund  held  unconstitutional   (Ohio),  793. 
Fund  exempt  from  seizure  for  debt  (Texas),  925. 
When  funds  not  exempt  from  seizure  for  debt   (X.  Y.),  727. 
Benefits  exempt  from  creditors'  claims  (N.  Y.),  714. 
See  Attachment  and  Creditors. 
GEORGIA: 

^Statute   relating    to    fraternal   societies,    103-107. 

Fraternal  beneficiary  society  defined.  103. 

May  pay  benefits  in  case  of  death,  sickne-ss  or  disability,  103. 

May  accumulate  and  maintain  reserve  fund,  103. 

Must  not  be  operated  for  profit,  104. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  104. 

Class  of  beneficiaries,  104. 

Benefit  societies  exempt  from  provisions  of  general  insurance  laws,  104. 

Society  now  having  members  in  State  may  continue  business  by  filing  annual 

report  and  appointment  of  Insurance  Commissioner  as  attorney,  104. 
Other  societies   must   file   certificate   from  insurance  official   in  state   where 

incorporated,  104. 
Also  certified  copies  of  charter,  articles   of  incorporation,  constitution   and 

laws,  104. 
Must  also  appoint  insurance  commissioner  attorney,   104. 

Society  must  file  annual  report,  104-105. 

How  suit  may  be  brought  against  society;  service  of  process,  105-106. 

Insurance  Commissioner  to  issue  permit,  106. 

Failure  to  make  report;  penalty,  106. 

Violation  of  statute;  penalty,  106. 

Societies  not  affected  by  this  statute,  106,  107. 
GOOD  HEALTH: 

Stipulation  as  to  reinstatement  (Ark.),  20. 

Contract  not  effective  until  payment  of  first  premium  while  in  (Ark.),  23. 

Definition  of  (111.).  168. 

Warranty  as  to   (Ind.).  231. 

Misrepresentation    (Me.),  387-388. 

Definition  of   (Mo.),  601. 

See  Reinstatement. 
GOOD  STANDING: 

Definition  of  (Conn.),  69. 

When  will  courts  interfere  to  maintain  (D.  C),  99. 

Resort  to  civil  courts  (D.  C),  99. 

Society's  books  not  only  evidence  of  (111.),  168. 

Presumed  to  continue  from  date  of  certificate  (111.),  180. 
GUARDIAN: 

Has  no  power  to  compromise  ward's  claim   (III.),  173,  174. 
HAWAII: 

Insurance  statutes,  119-128. 

Commissioner;   qualifications;  forms  and  blanks,  119. 

Deputy  Commissioner.  119- 120. 


INDEX 


1089 


HAWAII— Continued: 

Coinmissioiicr  sliull  report  to  legislatiire.  120. 

Powers  and  duties  of  Commissioner,  120. 

Commissioner  to  issue  certificate  of  authority  to  societj-,  121. 

Company  to  file  copy  of  cliarter  and  articles  of  incorporation,  121. 

Term  and  revocation  of  ccrtilicali'  of  authority,  121. 

Publication   of   revocation   of   license,   122. 

Business  without  certiticate  of  authority  unlaw  fill;  penalties,  122. 

Insurance  agent  must  be  licensed;  penalty,  122-123-124. 

Must  be  bonded,  124. 

Must  file  statement  of  gross  premiums  charged  on  insurance  placed,  124. 

Must  pay  to  Insurance  Commissioner  4  per  cent  of  such  gross  preniiiinis,  124. 

Insurance  Commissioner  may  examine  policies  issued.  124. 

Policies  issued  without  compliance  with   stat\ite.  void.   124. 

Resident  agent  to  Ije  a])pointed:   penalty.  12.5. 

Company  must  tile  power  of  attoiney  with  (  iiininir^sioiier.  12.'). 

Service  of  process,  125. 

Annual  statement,  12G. 

Foreign  corporations,   126. 

Fees  payable  to  Commissioner,  127. 

Taxes;  penalty,  127-128. 
HABITS: 

Excessive  indulgence  in  intoxicating  lic|Uors  (Ind.),  237. 

Excessive  use  of  intoxicating  liquors  (Ind.),  243. 

Of  member;  breach  of  warranty  (Ind.),  237. 

Misstatement  of,  by  applicant  (Ky.),  331. 

Death  from   (Me.),  388. 

Of  member,  testimony  of  non-expert  as  to  (X.  D.),  771. 

Intemperate,  what  is,  a  question  of  law  (S.  C),  861. 

As  cause  of  forfeiture  (Tenn.),  907. 

Question  as  to,  in  application  construed  (Texas).  940. 

Statements  in  apjilication  respecting  (Texas),  930. 

See  Forfeiture  and  Suspension. 
HEALTH: 

Certiticate  required  as  condition  for  reinstatement  (Iowa).  278. 

Certificates,  waivers  of   (Mo.),  598. 

Actual  condition,  not  apparent  health,  governs   (X.  D.).  771. 
HEIRS  AT  LAW: 

Definition  of  (Aj'k.),  23-24. 

Who  are  (Cal.),  40. 

Legal  heirs;  what  are  their  rights  wlien  designation  fails   (Colo.),  I'lO-Ol. 

Who  are  (Colo.),  57. 

As  beneficiaries  (Hawaii!.  129-130. 

Rights  of,  as  beneficiaries  (111.),  191. 

Rights  of,  where  beneficiary  murders  member  (111.).  173. 

Heirship,  order  of,  where  failure  of  designation  of  beneticiary    (111.).  173. 

Include  illegitimate  children   (Iowa).  293. 

Definition   of;   widow   is  heir   (Mo.).  004. 
69 


1090  FRATERNAL    SOCIETY    LAW 

HEIRS  AT  LAW— Continued: 

Meaning-  of   (X.  Y.).  725. 

Who  are   (Pa.),  S44. 

Heirs  and  wife  as  beneficiaries  (S.  C),  863. 

Who  are  within  the  term  (Wis.).  1028. 

See  Beneficiaries. 
HOME  STATE: 

Meetinss  lield  ontsiae  of   (111.).  102. 

Si'f  Meetings  ;inil  Powers. 
HUSBAND  AND  WIFE: 

Privileged    coninnmications    between    (Iowa),    292. 

See  Evidence  and  Privileged  Communications. 
IDAHO: 

Statute  relating  to  fraterniil  societies,  131-139. 

Definition   of  fraternal   society.   131. 

Benefit  and  expense  funds  to  he  derived  from  assessments.  131. 

Class  of  beneficiaries,  131. 

Society  ma^'  create  and  maintain  reserve  fund,  131-132. 

Associations  already  formed  may  continue  by  complying  with  provisions  of 
statute  regarding  annual  report  and  appointment  of  attorney,  132. 

Foreign  societies  to  file  copy  of  charter,  articles  of  association,  constitution 
or  laws,  1.32. 

ilust  appoint  Commissioner  as  attorney,  1.32. 

Must  be  authorized  to  do  business  in  state  where  incorporated.  1.32. 

Commissioner  may  examine  afi'airs  of  society,   132. 

Expense  of  such  examination  to  be  borne  by  society  and  not  to  exceed  $50.00, 
132-13:3. 

Annual  reports.  133-134. 

Service  of  process  on  society.  134-135. 

Permit  to  do  business,  how  obtained.  135. 

Mode  of  incorporation.  135-13(i. 

Employment  of  agents.  130. 

Contract  of  beneficiary  to  pay  dues:   efl'ect  of,  13(i. 

Benefits  not  liable  to  attachment  for  del)t.   1:30. 

Jleeting  of  Supreme  Lodge.  130-137. 

Fraudulent  statements;  penalties.  137. 

Failure  to  make  report;  penalty,  137-138. 

Failure  of  officer  or  agent  to  comply   with  statute:   neglect  to  obtain  certifi- 
cate of  authority;   penalty,   138. 

Fee  for  annual  report.  139. 

Chapter  does  not  ajiply  to  Masons.  Odd  Fellows,  etc.,  139. 
IDENTITY: 

Evidence  of   (Pa.).  8.30. 
IGNORANCE: 

of  member  as  to  laws  of  society  inexcusable    (1).  C. ).  100. 

Of  members  as  to  laws,  efl'ect  of   (.\ld.).  417. 

Of   facts   no  excuse    (ild.),  407. 


INDEX  1091 

ILLEGITIMATES: 

llli'f,'itiiii;ite  i-liildicii   iiicliiilcil  in  1<tiii  lii'irs  :it   l:nv    (Iowa),  29.'). 

Jlay  l)e  beTieliciarics  (Ti'Xas),  !)42. 
ILLINOIS: 

Statute  relating'  to  fratonial  societies,  Hl-lSS. 

Fraternal  beiiellciary  society  defined,  141. 

Societies  may  create  and  maintain  reserve  fund,   141. 

No  part  of  reserve  fund  to  be  used  for  expenses,  141. 

Class  of  beneficiaries,  142. 

Mcmlici-  witlioiit   wife  or  cliildrcn  may  make  cliaiilalilr  instinition  beneficiary, 
1 42, 

Oinimcicial  travelers  may  incorporate  under  tbis  act,  142. 

Existing  societies  may  continue;   conditions,  142-143. 

Admission  of  societies;   conditions,  \iZ. 

Annual  report,  144-145. 

Insurance  Commissioner  may  examine  all'airs  of  society.  14.5-140. 

Cost  of  sucli  examination  to  be  borne  by  society,  14.5-140. 

Society   must    publisli   annual   report,   146. 

Foreign   society   to    furnish   to   Commissioner  copy  of  examination  in  state 
where   organized,   140. 

Insurance  Superintendent  to  be  appointed  attorney,  14i;-147. 

Application   to  continue  business,   147. 

Mode  of  incorporating;  requirements;  certificate  of  association,  147-148. 

How  articles  of  association  may  be  changed.  149. 

Shall  not  have  paid  agents,  14!1, 

Benefits  exempt  from  attachment  for  debt.  149. 

Meetings  of  Supreme  Lodge.  149-1.50. 

False  representations;  penalty,   151}. 

Examination  by  insurance  superintciulcnt ;  aniuuil  report:  penalty.  150-151. 

Violations  of  statute;   penalty,   151-152. 

All  conflicting  acts  repealed,  1,52. 

Powers  and  duties  of  Insurance  Commissioner,  152-15.3. 

Investment  of,  societies'  funds,  153. 

Securities  may  be  deposited  with  Insurance  Commissioner,  153-154-155. 

Societies  may  give  sick  benefits,  hospital  or  medical  service.  155-1.58. 

May  create  special  fund  for  such  purpose.  155-158. 

Wlio  may  be  <'lectcd  delegates,  etc.,  of  fraternal  societies;  penalties,  158. 

Rights  of  foreign  society  in    (111,),  186-187. 

Wlien  contract   is  to  l)e  regarded  as  ah   Illinois  contract    (111.),  187. 
ILLNESS: 

Defined   (Vt,).  957,  900, 
IMPAIRMENT: 

Of  cimtracts  by  after-enacted  laws   (111.),  187. 
INCOMPETENCY: 

of  mcmlier  as  witness,  wlien   (111,),  183. 
INCONTESTABILITY: 

Changed  by  after-enacted  laws   (Ala.),  8. 

Incontestable  clauses  valid  (III.),  180. 

Incontestable  contracts,  how  affected  by  amendments   (Ind.).  248-250. 


1092  FRATERNAL    SOCIETY    LAW 

INCONTESTABILITY— Continued : 

Incontestable  clause,  eft'ect  of  (Ind.),  255. 
Suicide    (Kas.),   317. 

Incontestable  clause,  extent  of  (R.  I.),  852. 

False  statements  a.s  to  healtli  covered  by  im-ontestalili-  chui-f   iWis.i,  inill. 
INDIANA:       ' 

Statute  relating  to  fraternal  societies.  200-227. 

Fraternal  .society,  definition  of.  200. 

Sources  of  revenue,  201. 

Exempt  from  operation  of  general  insurance  laws,  201. 

Reserve  or  emergency  fund,  201. 

Existing   corporations   may   continue   to   do   business:    conditions;    penalties, 

201-202. 
Admission  of  foreign  associations,  202-20C. 
Certificates  must  be  paid  in  full,  203. 
Mortality  table,  203-205. 

Must  file  cop}'  of  constitution  or  by-laws,  205. 
Appointing  Auditor  of  State  as  attorney,  205,  208. 

Must   lie   authorized  to   do  business  in  state  where  incorporated,  205-206. 
Examination  of  society's  books  and  afl'airs;   expense.  200-210. 
Annual  report.  200-208. 
License  and  fee,  206,  209, 
Service  of  process;  fee,  208-209. 
Organization  of  fraternal  societies,  210-211. 
Articles  of  association;   form;   fee,  210-212. 
Heincorporation  of  existing  associations,  212-213. 
Eights  and  powers  of  fraternal  societies,  213. 
Shall  not  employ  paid  agents,  213. 
Right  of  member  to  change  beneficiary,  213-214. 
Exemption  from  attachment,  214. 
Exemption  from  taxation,  214. 

Legislative  body  of  society  may  meet  outside  of  state,  215. 
Applications    for    membership;     false    or    fraudulent    statements;    penalty, 

215-216. 
Failure  to  make  reports;  penalty,  210. 
Injunction  from  ti'ansacting  business;  roadmission.  210. 
Violating  injunction;   penalty,  210-217. 

Penalty  for  doing  business  for  unauthorized  associations.  217. 
Retaliatory  section,  as  between  states,  217. 
Societies  exempt  from  provisions  of  this  act,  217. 
Lodges  of  Masons,  etc;  articles  of  association,  218-219. 
Purposes  of  association,  lodges  of  Masons,  etc.,  218-219. 
Must  present  articles  of  association  to  Secretary  of  State,  219. 
Powers  and  rights  of  associations,  220. 
Duties  of  Auditor  of  State;  receiver,  220. 
Society  must  file  copies  of  articles  of  association,  constitution  and  by-laws 

with  Auditor  of  State,  220. 
■Capital  stock,  increase  or  decrease,  220-221. 


INDEX  1093 

INDIANA— Continued: 

Election  of  ollicers;  records  iiiay  lie  used  as  evidence,  221. 

Dissolution  of  association;  receiver,  222. 

Jurisdiction  of  court,  22. 

Duties  of  receiver,  222-22.3. 

Final  order  for  dissolution;  diitv  ul  ricrk  <il  cuurt,  22.3. 

Right  to  amend  or  repcnl  tliis  iict.  223. 

Laws  repealed.  223  224, 

Riglits  of  existing  corporations,  224. 

Benefits  exempt  from  creditors'  claim,  wlien,  224-225. 

Venue  of  action ;  service  of  process,  22.5. 

Right  to  change  beneficiary,  225-226. 

Commencement  of   suit  in,  or   removal  of   suits    to,   United   States   courts; 
])enalty,  220. 

Provisions  fif  tliis  act  are  conditions  precedent,  227. 

[■'ratiTiial  act  construed   (Ind.),  251. 
INITIATION: 

Failure  to  lie  initiated  invalidates  certificate  (Ark.),  25-26. 

Election  of  ap|)licant  to  office  before  (Ark.),  26-27. 

Society  not  responsible  for  injuries  to  member  during  {!Mich.),  474. 

Condition  precedent  to  issuance  of  certificate  waived   (^Mich.),  487. 

Essential  condition  to  liability   (Mo.),  597. 

A  condition  precedent  (Neb.).  044, 

When  society  liable  for  injiu'ies  sustained  ilurin;;-  (X.  Y,).  7UJ. 

Society  liable  for  damages  sustained  in  (S,  (',).  803, 

Jfay  be  waived  by  society    (Texas),  937. 
INJURIES: 

During  initiation   (ilich.),  474;    (\.  Y,).  710;    (S.  C).  803. 
INSANITY: 

Sane  or  insane  after-enacted  suicide  laws   iGa,).  112. 

Sane  or  insane  suicide  clause  (Ga.),  110, 

Sane  or  insane  suicide  provisions  in  certificates  valid  illl,i.  184-185. 

Sane  or  insane  provisions  valid   (111.),  179-180. 

Sane  or  insane  clause  valid  (111.).  167. 

Suicide  by  insane  member    (111.),  184-185. 

No  defense  in  suicide  cases  (111.),  159. 

No  defense  in  suicide  cases   {111.),  179-180. 

Insane  impulse,  definition  of   (111.).  172, 

How  far  sullicient  to  prevent  inember's  changing  liis  beneficiary   (Iowa),  287. 

Sane  or  insane,  suicide   (Kas.),  323. 

Sane  or  insane,  suicide,  definition  of  (Ky,).  335. 

Suicide  during  (Ky.),  334. 

Suicide  during  (Mich.),  477. 

Sane   or   insane,  suicide    (Minn.),   523. 

Insane  member,  suicide  of   (Minn.).  519. 

Sane  or  insane  provision  in  suicide  law  valid  (N.  C).  753. 

Sane  or  insane  suicide  law  valid  (Pa.).  834.  842,  837. 

Sane  or  insane  clause  valid  (S.  C),  862. 


1094  FRATERNAL    SOCIETY    LAW 

INSANITY— Continued: 

A  bar  to  designatior.  of  bencti<-iary   (Tenii.),  905. 

Of  member  no  bar  to  society's  afl'ecting  liis  contract  by  legislation   (Tenn.), 
900. 

Suicide  of  member  during   (Wasli.),  !)i)4. 

Of  member  does  not  relieve  of  obligations   (Wash.),  997. 

Trial  of  insane  member,  etc.    (^\'asll.).  993. 

Expulsion  of  member  during  (Wash-.),  993. 

For  suicide  wliile  insane,  see  Suicide. 

For  chiuse,  "sane  or  insane,"  see  Suicide. 
INSOLVENCY: 

Reserve  fund  cannot  be  used  while  society  is  solvent  (Cal.).  4(i. 

Definiticm  of  solvent  society   (Neb.),  639. 

Rights  of  members  in  case  of  insolvent  society   (Pa.),  841. 

i;cci-ivi-i-  fill    iii-iilM-nt   society   (Pa.).  S37. 
INSTALLMENT   CERTIFICATE: 

Ai-tidii   lie-.  Miily  cin  drfault   iil'  |iayment   of  each   installment    (Te.vas),  932. 
INSURABLE  INTEREST:    iMi.h.i  407. 
INSURANCE  COMMISSIONER: 

Mandamus  against   (111.),  191. 

Service  upon,  not  exclusive  method  (111.),  159. 

Service  of  summons  on,  confers  jurisdiction  on  society    (X.  C).  756. 

Service  of  process  on  (N.  C),  749. 

Power  of  attorney  to.  is  irrevocable   (X.  (.'.),  748. 

Power  of  attorney  to  (X.  C).  751. 

Discretion  of   (Neb. ) .  642. 

Duty  of,  in  case  of  non-coiii|iliaiu-i'  of  society   witli  law    (X'eb.),  041. 

Duties  of,  ministerial  respecting  issuance  di  licensf  (X'.  Y.).  729. 

Mandamus  of   (Ohio),  791. 

Mandamus  against   (Wis.),  1023. 
INTEMPERANCE: 

Dcatli  fr..ni    llnd.l.  240. 
INTEREST: 

Allowabli.  (Ill    claim    (liiwal.  286. 

Wlien    pidpcr   to   allow    I U.    I.),   856. 
INTEREST,  VESTED: 

Sec  Vested  Interest. 
INTERPLEADER: 

Society  alone  can  claim   nun-liability   (Ark.),  24. 

Right  of,  by  society   (Cal.),  42. 

Right  of  (Cal.),  42. 

Counsel  fees   (Ga.).  110. 

Evidence  under  (Mich.).  475. 

Rights  of  beneficiary  not   allcctcd  by   iMont.l.  611. 

Does  not  help  out  incomi>etcnt  beneliciary   (X.  J.).  694. 

What  questions  settled  (X.  Y.),  727. 

Rights  of  beiteficiary  under   (Ore.).  819. 

Attornev's  fees  not  allowable  out  of  fund  (Texas),  930. 


INDEX  1095 

INTOXICANTS: 

l-'iir  iisr  lit',  sec  Habits. 
INVALID  CLAIMS: 

Suit  liy   iiii'inlicrs  In  prcvi'iil    |i;iyiiioiit  nl'  (  I  ml.  1 .  231. 
IOWA: 

Statute   relating   to   fiateinal   societies,   2'M.  274. 

Definition  of  fraternal  society.  256. 

Societies  shall  make  provision  for  payment  of  death  benefits,  25G. 

Benefit  fund  to  be  derivod  from  assessments,  250. 

Insurable  age.  257. 

Class  of  beneficiaries.  2.-17. 

Societies  to  be  exempt   t'lcMii  operation  of  general  insiuiiiu-e  law,  257. 

Copy  of  application  to  be  attached  to  certificate,  257. 

Where  societies  may  be  sued,  257. 

Benefits  exeni])t  from  attncliniciil    I'cir  debt,  258. 

Foreign  societie.s,  25S. 

Must  file  copy  of  charter,  articles  of  association,  constitution  or  laws,  2.58. 

State  Auditor  may  examine  society's  books  and  accounts,  258. 

Expense  of  such  examination  to  be  borne  by  society.  258. 

Annual  report;  form,  258-260. 

Appointment  of  State  Auditor  as  attorney;   service  of  |n-oces.-..  2(iO. 

Authority  to  do  business:   conditions;   license  fee.  201. 

Society  shall  not  employ  paid  agents.  201-202. 

Change  of  beneficiary,  262. 

IMeetings  of  Supreme  T.odge,  262. 

Violations  of  statute:   penalties,  262-263. 

Doing  business  without  authority;  agents  and  officers,  penaltv,  20.3. 

False  representations  by  officers  or  agents;  penalties.  203. 

Applicants  for  membership  to  be  examined  by  physician.  203. 

Act  of  March  17.  Ifl04,  regarding  examination  of  societies.  204-206. 

"Association"  defined,  264. 

Examinations;   assistants;  compensation.  2(i4. 

Officers  of  society  to  assist  in  examination;   examiner  nuiy  administer  oaths, 

264. 
Revocation   or  suspension  of  license:   appointment  of  receiver.  264-265. 
Expenses  of  examination  to  be  borne  by  society.  205. 
Soliciting  business  during  revocation  of  license:  penalty.  265-206. 
Act   of   March    30.   1004.    prox  iding   for   consolidation   of  fraternal   societies, 

266-267. 
Plan  of  consolidation  to  be  ]iresented  to  State  Auditfir  fur  approval.  200. 
Reinsurance  of  members,  266. 

Plan  of  consolidation  to  be  submitted  to  all   associations  interested,  206. 
Plan  of  consolidation  or  re-insnrancc  ULUst  be  ap]iiiived  bv  a  two-thirds  vote 

of  the  members.  266. 
State   Auditor  shall    direct    such   distribution   of  assets   as   ma,v  be   just   and 

equitable,  267. 
Expenses  of  consolidation  to  be  borne  \>y  associations  interested,  267. 
Violation  of  statute;  penalty,  267. 


1096  FRATERNAL    SOCIETY    LAW 

IOWA— Continued: 

\\  lii'ie  iiisuiaiice  eoiiipaiiips  iiiav   be  sued,  "267. 

Act  of  February  9.  1907.  a])))lying  Sec.  1794  of  Insurance  Code  to  fraternal 
.societies,  209-274. 

Foreign  companies  eligible  to  do  business;  oonditions.  209. 

ilust  file  copy  of  charter,  article>  of  incorporation,  bylaws,  application,  and 
certificate  of  membership,  209. 

Society  must  rile  statement  showing  name,  location,  principal  place  of  busi- 
ness, officers,  assets,  etc.,  269. 

State  Auditor  to  issue  license,  269-270. 

State  Auditor  may  examine  books  and  accounts,  270. 

Revocation  of  license,  270. 

Permission  to  do  business:  conditions.  270. 

Fraternal  Congress  mortality  table,  271-272. 

Fraternal  society  may  own  real  estate,  erect  buildings,  etc;   conditions,  272- 
273. 

Investment  of  funds.  27.3-274. 
JUDGMENTS: 

Juror  member  of  society  m  suit    (Bel.).  82. 

Verdict  of  jury  may  rest  upon  b\it  little  evidence    (Ind.),  248. 

Time  within  which  they  must  be  paid  (Kas.),  311-312. 

Time  to  perfect  appeals  from    (Kas.),  314. 

Appeal  from  void,  not  necessary   (Wis.),  1023. 
JURISDICTION: 

Of  courts  over  lodge  disputes   (Cal.),  44,  47. 

By  courts  over  lodge  trials  (Cal.),  39. 

Of  courts  when  members  in  contest  with  society   (Cal. I,  37. 

Of  courts  over  foreign  societies   (D.  C),  99-100. 

Of  courts  to  review  lodge  trials  (Iowa),  288. 

Suit  may  be  brought  in  any  county  where  loss  occurred  (Iowa),  268. 

Contracts  restricting,  void  (Iowa),  208. 

Of  suits  against  societies   (Iowa),  267. 

Of  courts  over  lodge  trials   (Kas.),  317.  324. 

Conflicting  (Kas.),  319. 

Of  courts  over  foreign  societies   (ild.).  413-414. 

Of  tribunals  of  societies  (Md.).  417. 

For  suit  on  certificate  (Xeb.j.  641. 

See  Courts  and  Trials. 
KANSAS: 

Statute    relating   to    fraternal    societies.   299-310. 

Definition  of  fraternal  beneficiary  society,  299. 

Must  have  representative  form  of  government,  299. 

Must  pay  death  benefits,  299. 

Benefit  fund  to  be  derived  from  assessments.  299. 

Class  of  beneficiaries.  300. 

Conditions  on  which  foreign  societies  may  do  Imsiness.  300. 

ilust   file   copy   of   charter,   articles   of   incorporation,   constitution    ami    laws, 
300. 


INDEX  1097 

KANSAS— Continued : 

Must  be  authorized  to  do  business  in  state  where  organized,  300-301. 

Superintendent  of  Insurance  may  examine  hof)k«  ;uifl  arcnunts:   expenses  of 
examination,  301. 

Annual  statement.  .'^Ol-.'iOS. 

Ap|iointnient  of  SupcriMtcndeMt  "I'  lii>iirance  as  attorney;  service  of  process, 
303-304. 

License  to,  do  business.  304. 

Method  of  organization  for  fraternal  societies.  .304-30.5. 

Fraternal  societies  shall  be  bodies  corporate,  30.5. 

Eights,  duties,  and  liabilities,  305-306. 

Unlawful   for  officers   to  use   mortuary   or  emer^'cncy   fund   for   i-xiicnse  pur- 
poses; penalty,  30(i. 

Conditions  under  which  certilicates  may  be  issued.  .'iOd-^iO?. 

Amendment  of  articles  of  association:  meetings  of  legislative  body.  307. 

Benefits  exempt  from  attachment  for  debt,  307. 

False  or  fraudulent  statcmeiits,  penalties.  308. 

Violation  of  statute;  penalty;  levocation  of  liccii-e;  a|j|"iiiil  iiicnl  of  receiver, 
308-309. 

Doing  business  witlioiit  nuthority;  penalty,  30!1. 

Decisions  of  Superintendent  of  Insurance  Ijinding  until  reversed  by  court.  310. 

Societies  exempt  from  operation  of   this  statute.  310. 

Agents  exempt  from  payment  of  license.  310. 

Removal  of  suits  to  U.  S.  courts.  .308. 

Paynu'Ut  of  Judgments.  308. 
KENTUCKY: 

Kentucky  has  no  fraternal  insurance  code.  3.30. 

Section  679  of   General   Statutes   not    applicable   to   fraternal   societies.  330. 

Section  679  as  amended  in  1906,  330-331. 
KIN,  NEXT  OF: 

As  beneficiaries  (ilicli.i.  477. 
KNOWLEDGE: 

Of   local   lodge   imjnited   to   society    (111.),    186. 

Of  agents  imputed  to  society    (Ind.).  233. 

Of  agents  imputed   (Ind.).  '239. 

See  Agency  and  Waivers. 
LAWS: 

Death   in   violation  of  law.   what  is   not    (Ark.).  21. 

Are  prospective  in  operation  (D.  C),  97. 

Ignorance  of  member  of.  inexcusable    (D.   C).   100. 

Violation  of  its  own.  by  society,  effect  of   (111.),  194. 

Reasonable  after  enacted,  what  are  (111.),  194. 

When  after-enacted,  are  retroactive  (111.),  189. 

Resperting  beneficiaries  may  be  waived  (111.),.  196. 

Formality  not  requisite   (III.),  193. 

Of  State  not  retroactive  (111.).  160. 

Are  part  of  member's  contra<'t   (Ind.).  236-237. 

Of  society;  conflict  in   (Mich.),  491. 


1098  FRATERNAL    SOCIETY    LAW 

LAWS— Continued: 

Assent  of  member  to  change  in  (Midi.),  485. 

Knowledge  of,  presumed.     Waivers  by   local   ollicers   not  favored    (Mo.),   598. 

Dormant  by-laws,  effect  of  (X.  H.),  ti74. 

See  Violation  of  Law,  After  Enacted  Laws,  By-laws,  Contract,  State  Laws. 
LAWS,  AFTER  ENACTED: 

Si-c  After  Enacted  Laws. 
LEGAl.  HEIRS: 

See  Heirs  at  Law. 
LEVEL  RATE  CONTRACT: 

Definiticin  of    (Mo.l,  57!). 
LIABILITY: 

On  bond  is  predicated  on  liability  on  contract   (Ark.),  20. 

On  bond,  date  of  beginning  of   (Ark.),  20. 

Denial  of,  waives  proof  of  loss  (Ark.),  20. 

Precedent    conditions    to    (Ark.),    23. 

Society   alone  can  avail   itself  of  the  plea  of  nonliability    (Ark.),  24. 

When  does  it  begin   (Ark.).  26-27. 

Denial  of,  waives  proofs  of  death   (Colo.),  58. 

Conditions  precedent   to    (Conn.),   70-71. 

Does  not  depend  upon  issuance  of  cei-tilicate  (Ga.),  107. 

For  agent's  negligence  (Hawaii),  129. 

Denial  of,  waives  proofs  of  death,  (111.),  181. 

Conditions  precedent  to  (Iowa),  207-298. 

Conditions  precedent  to   (Iowa),  289. 

Death  of  applicant  before  beginning  of  (Ind.).  234. 

Special  agreements  limiting   (Ind.),  228. 

When  it  begins  (Ky.).  .332. 

Beginning  of;  conditions  precedent  (Kas.)  311. 

Conditions   precedent   to    (Kas.),   327. 

Denial  of,  waives  jiroofs  of  loss  (La.),  361. 

Conditions  precedent  to   (Mass.).  448. 

Conditions  precedent  to   (Miss.).  5.50. 

Of  receivers   (Mich.),  486. 

Initiation  a  condition  to   (Mo.  l.  597. 

Denial  of.  removes  bar  to   suit    i.Neb.),  638. 

Precedent  conditions  to  (Xeb.).  636. 

When  does  it  begin   (X.  C),  751. 

Conditions   precedent   to    (X.   C.I.    74(i. 

Conditions  precedent   to    lOhio).   791.  792. 

When  does  it  begin  (Pa.).  840. 

For  beneHts;  when  it  begins  il!.  I.).  857. 

Denial  of:  wheh  not  waived  by  comiiromise  of  claim  (S.  C).  859. 

Conditions  precedent  to   (Texas).  941.  9.!4.  943. 

Delivery  of  certificate  condition   precedent   to    ll'tali).  949. 

Conditions  precedent  to,  ]u-oper  l\Vyr>.),  I(i;i8. 

Delivery    of   contract    ;is    picci'ilciil    rdmliiiim    t(i.    valid    iWyo.),    1037. 
LICENSE: 

Doing  business  without;   validity  of  contracts  (Ind.),  228. 


INDEX  1(J99 

LIEN: 

On  (•(■rtificntc;  statntp  of  liiiiiliilidiis   (Cal),  40. 

(Ill   riiciiil)ci's  i-crlilicntc    |(':il.).  4(1. 
LIMITATIONS: 

A\'iuver  of  statute  in  contnict  is  void  (Ala.),  11-12. 

Statutes  of.  cannot  be  waived   (.Ma.)!  11-12. 

Statutes   of,   valid    (Ark.i.   2(1. 

Clauses  in  contract  upheld  (Ark.),  20. 

Release  of  statute  of   (Cal.),  37-38. 

Eirect   of  statute   of    (Cal.),   40. 

Statute  of;   lien  on  member's  certificate   (Cal.).  40. 

Release  from  statute  of,  by  acknowledgment  of  claim  (Cal.),  37-38. 

Validity  of  statvitos  of.  adopted  by  societies   (Conn.).  73. 

Statutes  of.  do  not  apply  to  claims  for  w  iiinj;ful  repudiation  of  contra(tt  ((ja.), 
111. 

Statutes   of,   by   societies,   valid    (III.).    ItiO. 

On  rif>'lit  to  levy  assessments   (111.),  177. 

Statute  of;    contract   nuiy    limit   time   fur   suini;    (lowal,   2SI. 

Statutes  of,  valid   (Iowa),  281. 

Time   witliin   wliicli   suits   must    In'   broii;;lit;    after-enacted   laws    (Kas.),  .'521. 
Time   limit  for  suit    (Kas.),  324. 

Statutes   of.    passed    by    societies.    \(iid    (Ky.l,    .'i31. 
As  to   bringini;  .suit;   after-ciiaclcd    Ia\\s    (Mass.i.  430. 
Time  to  sue   (Mich.),  470. 

Of   time   to   sue;    ne,!>'otiiiti(ins    for   set1lcnn>iit  ;    waiver    (Mich.).   470. 
Limit    of    time    in    «liii-li    In    sue:    waiver    of.    by    society    (.Md.).    40!). 
As    to    time    tor    lilin;;    pioot^    ,if    loss    iMd.i.    41."i. 
(Jf   law   presumed   to    he    known    (Miss.).   .5.53. 

Statute    of,   does   nut    run    in    lavnr   of   foreign   societies    (X.   C),   7.51. 
For  brinn-inj;   suit    waived   by   repudiation    (X.   J.),   003. 
As  to  time  for  suing  (X.  Y. ),  715. 
By-law   fur  bringing  suit    valid    (Ohio),  700. 
Statute  of,  wdien  it  begins  to  run   (Pa.),  845. 
Statute  of,  in  societies,  valid   (R.  I.),  855. 
Statute  of,  by  societies,  void   (S.  D.),  8S1. 
Statute  of.  when  it  begins  to  nni   (Texas).  034. 
Statute  of,  in  contract,  \alid   (\'t.),  058. 

Statute  of,  in  contract,    as    to    time    to    instit\itc    suit,    valid    (Wash.),    002. 
Statute  uf.   in   conti-act.    valid    (Wis.).    102(1. 
LIVING  ISSUE: 

Term   construed    (Minn.).  525. 
LODGE  OFFICERS: 

See  Officers. 
LODGE,   SUPREME: 

See  Supreme  Lodge. 
LOUISIANA: 

Statutes    relating   to    fraternal    s(jcicties,    330-301. 
Fraternal    beneficiary   association   defined.    3:30. 
Lodge  System,  definition  of;   re(|uirements.   330-340. 


1100  FRATERNA-L    SOCIETY    LAW 

LOUISIANA— Continued : 

Representative  form  of  government;  definition:  requirement's,  340. 

Societies  must  provide  for  payment  of  death  benefits,  340. 

Class  of  beneficiaries,  340. 

Age  limits,  341. 

Certificates   shall   state  amount  of  benefit,   341. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  341. 

What  shall  constitute  contract  between  association  and  member,  341. 

After-enacted  laws   valid,  341. 

All  amendments  must  be  made  by  supreme  legislative  body,  341. 

Reserve  or  emergencj-  fund.  342. 

Investment  of   funds,   342. 

Benefit  or  reserve  fund  not  to  be  used  for  payment  of  expenses,  342-343. 

Organization  of  beneficiary  associations,  343-345. 

Status  of  existing  societies  under  this  act,  345. 

Consolidation    of   societies.   345-346. 

Status  of  foreign  societies  under  this  act.  34G-347,  351-352. 

Must  file  copy  of  charter,  articles  of  incorporation,  constitution  and  laws, 
membership  contracts,  etc..  34G. 

Secretary  of  state  to  issue  license.  340-347. 

Revocation  of  license,  347. 

Appointment  of  Secretary  of  State  as  attorney.  347-348. 

Service  of  process,  348. 

Meetings  of  Supreme  Lodge,  348. 

Ofliicers  of  societies  not   individually  liable  on  contracts.  348. 

Officers  and  subordinate  bodies  cannot  waive  provisions  of  constitution  and 
laws,  349. 

Grand  Lodges  to  be  treated  as  federation,  not  as  separate  State  organiza- 
tions, .349. 

Copies  of  amendments  to  laAvs  to  be  filed  with  Secretary  of  State.  349. 

Annual  report,  349. 

Examination    of   society's   books   and    affairs,    350. 

Non-compliance  with  law.  revocation  of  license;  receiver.  350-351. 

Admission  of  foreign  societies,  351. 

Societies  exempt  from  the  operation  of  this  law.  352. 

Changes  in  rates.  352-.353. 

Extended   insurance,   3.52-353. 

Societies  shall  not  employ  paid  agents.  353. 

Incontestability  of  contracts,  353. 

False  or  fraudulent  statements  in  applications,  etc.,  penalty,  353-354. 

Definition  of  "association;"  or  "domestic  association:"  of  "foreign  associ- 
ation;" of  "State,"  354-355. 

Valuation  of  certificates,  3.55. 

Act  of  July  4.  190r — "An  Act  to  defini'  and  regulate  the  business  of  indus- 
trial life  insurance,"  355-358. 

"Industrial   life  insurance"  defined,  350. 

Companies  and  societies  s\ibject  to  the  operation  of  this  Act,  350,  .357. 

Conditions   precedent   to   doing   business,   35C-357. 

Violation  of  statute;  penalties,  358. 


INDEX  1101 

LOUISIANA— Continued: 

Act  of  June  30,  1902 — "An  Ad  ti>  levy  liicnse  tax  upon  liencvolent  or  fra- 
ternal societies  or  assbciiitioiis  who.  Ilirongli  agents,  solicit  membership 
from   house   to   house,"   SiiS-SOO. 

Classes  of  societies  subject  to  this  act,  :i.").S -;!.")!). 

Secret  fraternal  organizations  excnipteil  from  the  aiiplication  ot  tliis  act, 
359. 

Act  of  .July   S.   189S,   3(i0-;i(>l. 

Societies  must  file  copy  of  charter;  copy  of  newspaper  wliere  charter  pub- 
lislied;  copy  of  amendments  to  cluirtcr;  copies  of  minutes  of  meetings; 
copies  of  agreements  for  consolidation.  .'jiiO-liiil. 

Duties  of  Secretary  of  State,  361. 

Secretary  of  State's  transcript  of  documents  aihiiissiblc  as  evidence,  301. 
MAINE: 

Statutes  relating  to  fraternal  societies,  3()9-3.S(i. 

Fraternal   beneficiary   association   defined,   309. 

Societies   must   make  provision   for   death   benefits.  309. 

Benefit   and  expense  funds  to  be  derived  from  assessments.  309. 

Class  of  beneficiaries,  369. 

Societies   exempt   from  general   insurance   laws.   309. 

Maj'  create  and   maintain  reserve  or  emergency   fund.  300-370. 

Incorporation   of   fraternal   societies,  370-371. 

Existing  societies   may   re-incorporate;    provisions.   371. 

Societies  shall  not  do  business  without  certificate  from  Insuranci-  Commis- 
sioner;  requirements,  371-372. 

Must  deposit  15  per  cent  of  mortuary  receipts  with  State  Treasurer.  372-373. 

Discontinuance  of  business ;   appointment  of  Receiver,  373. 

Emergency  or  reserve  fund,  373. 

Consolidation   of  societies;    requirements.   373. 

Status   of  foreign  societies   under  this  act,  373-374. 

Must  obtain  license  from  Instnancc  Commissoner,  374. 

Must  file  copy  of  charier,  articles  of  incorporation,  constitution  and  laws, 
374. 

Appointment   of  Commissioner   as   attorney.  374-375. 

Statement  of  business  for  preceding  year,  374. 

Must  be  qualified  to  do  business  in  State  where  incorporated,  374. 

Rates  not  to  be  lower  than  indicated  by  National  Fraternal  Congress  mor- 
tality table,  374. 

Beneficiary   shall    not   pay   assessments,   375. 

Mortuarj'  or  reserve  fund  cannot  be  used  for  expenses.  375. 

Society  may  employ  paid  agents,  375. 

Agents  must  be  licensed,  375-376. 

Soliciting  business  without   license;    penalty,  370. 

Annual  report,  376. 

Benefit  fund  not  subject  to  attachment  for  debt,  370-377. 

False  and  fraudulent  statements  in  applications,  etc.:  penalty,  377,  384.. 

Societies   not   subject  to  the  provisions   of  this  act,  377-378.  .381-384. 

Examination  of  society's  books  and  accounts,  378. 


1102  FRATERNAL    SOCIETY    LAW 

MAINE— Continued: 

Status  of  foreign  societies  under  this  Act,  379. 

Revocation  of  license,  370-380. 

Age  limit,  380. 

Retaliatory  clause,  as  between  States.  3S0. 

Violation  of  statute,  penalty,  3S0-3S1. 

"Association"   defined,    381. 

Status  of  subordinate  lodges,  381. 

Societies  not  conducting  its  business  on  the  lodge  system.  381-384. 

Admission   to   do   business:    requirements,   381-384. 

Copy   of   application   to   accompany   policy,  384. 

Actions    against    foreign    companies,    385. 

Larceny  by  insurance  agent,  385. 

Examination  into   insurance   frauds.  3S5-3S(i. 
MANDAMUS: 

Is  proper  remedy  against  Superintendent  of  lusuranoe   (Hll-  l!'l. 

Not  required  to  preserve  rights   (Ind.),  248. 

Against   State  Auditor   (Ind.),  251. 

Against  Insurance  Commissioner    (llinn.).   514. 

Unlawfully    expelled    member    entitled    to     (X.    •!.).    005. 

Against  Insurance  Superintendent    (X.  Y.).   72!). 

Will  not  lie  to  reinstate  member    (X.   Y.).  710. 

Of  Insurance  Commissioner  (Ohio),  701. 

Against   Insurance   Commissioner    (Wis.).    1023. 
MARRIAGE: 

Effect  of  member's,  on  his  beneficiary   (Cal.).  3(i. 

Presumption   of   legality    of;    burden   of   proof    (Colo.).   50. 

Of  member:   eft'ect   on  beneficiary    (111.),   108,   190. 
MARYLAND: 

Statute    relating    to    fraternal    societies,    392-407. 

Definition  of  fraternal  beneficiary  association,  392. 

Lodge  system;   ritualistic  form  of  work;   represeiitntivc  form  of  government, 
392. 

Shall  pay  benefits  in  case  of  sickness,  disability  and  death,  392. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  392, 

Glass   of  beneficiaries,  392. 

Dependency  necessary,  392-393. 

Assignability  of  benefit.  393. 

Change   of  beneficiary.   393. 

Societies  shall  be  exemi)t  from  general   iiisurnuce  biw.  303. 

Endowment  policies;    dividends;    surrender   \;ilues;   old  age   benefits;   limited 
payment  policies,  303. 

Existing   societies    may   continue    to   do    business;    conditions,   303-394. 

Commissioner  of  Insurance  may  examine  books,  etc.,  394,  305. 

Society   must   file   copy   of  charter,   articles   of   association,   constitution   or 
laws;  Commissioner's  fees,  394-395. 

Appointment    of    Commissioner    as    attorney,    .394-395,    300-397. 

ISlust  be  authorized  to  do  business  in  State  where  incorjiorated.  395. 


INDEX  1103 

MARYLAND— Continued : 

Jjicciiso.  ,'!',1."). 

Annual   report,   3'.):-,.  Wdl.  ;i!)!). 

Insolvency;   examination  of  accounts,  .'SOO. 

Service  of  process  on  Insurance  Couiniissioner,  31)0-397. 

Societies  not  to  cuijjloy  paid  agents,  397. 

Benefit  fund  not  subject  to  attachment  for  debt,  3!t7. 

Mcctinfis   of   Supreme   Lodge,   397. 

False   or   fraudulent    statements    in    :ipplications    foi-   nieiiiber^liip.   etc.;    ))en- 
alties,  307-39S. 

\'iolation    of    law:    injunction;    reinstatement;    penalties.    31).S-y!l!). 

Doing  business  without  authority;   ])enalties.   390. 

Incorporation   of   fraternal    societies,   399. 

Societies  exempt  from   the  operations  of  this  law.  31i:i-4UU. 

Fraud  by  directors  or  officers;   penalty.  400. 

Husband    and    wife — insurance.    400-401. 

Suits  at    law  ;    >er\  ice   of  process;    judgments.  401-40:^. 

I'rovisions    lor   tlii'    formation   of   corporations,   402-407. 
MASSACHUSETTS: 

Statute  relating  to  fraternal   societies.  41S-439. 

Incorporation,  418. 

Representative   form    of   government:    lodge    system.   418. 

Election   of   officers.   419.   420. 

By-laws,  419. 

Admission    of   new    membeis;    meetings    of    subordinate    lodges.    419. 

Certificate  of  organization  and  records  to  be  submitted  to  Insurance  Com- 
missioner; fee,  419-420. 

License  to  transact  business,  420. 

Rates  not  to  be  lower  than   indicated   liy   the   Xalioual   Fraternal  Congress 
mortality  table,  420-421. 

Meetings  of  Supreme  Lodge.  421. 

Death  and  disability   benefits,  421. 

Benefit  and  expense  funds  to  lie  derived  from  assessments,  421. 

Amount    payable    under    certificate    limited    by    :uiio\uit    received    in    assess- 
ments,  when,  421. 

Class  of  beneficiaries,  421-422. 

Amount  of  death   fund   limited   to   three   assessments.  422. 

Uses  of  emergency   fund.   42.'!. 

Investment  of  emergency  fund.  423. 

Beneficiary   cannot    pay   assessments   on   certificate.   424. 

Funds   other   than   those   derived   fi-om   assessments,   424, 

Status  of  subordinate  bodies   and  lodges,   424-425. 

Assessments    for    expense    fund,    425. 

Societies  which  do  not  pay  death  benelit-,   42."i. 

Consolidation   of   societies.   425.  , 

Societies  not  subject  to  the  provisions  of  this  statute,  425-520. 

Admission  of  foreign  societies,  426-427. 

Annual    report,    427. 


1104  FRATERNAL    SOCIETY    LAW 

MASSACHUSETTS— Continued : 

Examination   of   society's   ail'aiis.   427-428. 

Societies  not  to  employ  paid  agents,  428. 

But  may  employ  organizers   in  the  preliniinavv  organization  of  local  lodges, 
428. 

Doing   business   without    authority;    penalty,    428. 

Filing  of  amendments  to  by-laws,  428-429. 

Benefit  fund  not  liable  to  attachment  for  debt,  429. 

False   or   fraudulent   statements  by   agents,   physicians,   etc.;    penalty,   429. 

Revocation  of  license;   injunction;  receiver,  429-430. 

Change  of  purpose  for  which  society  was  organized;  reincorporation,  430-431. 

Violation  of  statute;  penalties,  431. 

Corporations   exempt,    431. 

Certain  fraternal  beneficiary  corporations  may  become  assessment  societies, 
431-433. 

Benefit  to  member  on  death  of  wife,  433. 

Conflict  in  names  of  benefit  societies,  433. 

Corporation  Law,  433-439. 

Incorporating;   reincorporating;   rights,  duties  and  privileges,  433-439. 
MATERIALITY: 

Immaterial  answers  made  material  by  agreement   (Kas.),  325. 

Of  questions  conceded  by  inquiry    (La.),  362. 

Of  warranty  not  essential   (La.),  365. 

Of  statements  warranted  (Me.),  387. 

Determined  by  contract   (Neb.),  636. 

Of   questions   for   the   jury    (Xev.),   658. 

Of  representations   (X.  C),  752. 

What  is  material  fact   (Pa.),  845. 

Of  representations  not  for  the  jury   iPa.).  834. 

Of  representations    (R.   1.).  So5. 

Of  questions  and  answers   (\\'is.i.   1021. 

See  Representations  and  Warranty. 
MEDICAL   EXAMINER: 

Statements  by  applicant  to   (Ga.i.   110. 

llember's  rights   under   medical   examination    (X.  J.),   687. 

Medical  examination  not  part  of  contract    (E.  I.),  851. 

Agent   of   whom    (R.   I.),   852. 

Agency  of   (Tenn.),  903. 

Agency  of,  limited  (Tenn.l.  90S. 

Agency  of   (Texas),  944. 

Knowledge  of.  imputed   (Texas),  931. 

Report   of.    as   evidence    (Wis.),    1021. 

See   Agency. 
MEETINGS: 

Place  of,   for  Supreme   Lodge    (Colo.).  .54. 

Held  out  of  home  State  validated    (111.).   192. 

Of   legislative   body   held   in   foreign    State    (Kas.),   320. 

Right  to  hold,  outside  of  State  where  chartered  (Pa.),  842. 

Of  society  may  he  held  outside  of  State  where  chartered  ('J'exas),  925. 


INDEX  1105 

MEMBERS: 

Dentil  by  member's  hand   (Ala.).  10. 

Not  entitled  to  recover  durinf;  life  the  aiiioiiiit  paid  in    (Ala.),  7. 

Rights  determined  by  contract,  not  by  charter  of  company   (Ark.),  22. 

Property    rights    of.    incidental    (Cal.),   40. 

Interest  in  pro])crty  ceases  ujion  termination  of  membership  (Cal.),  4(i. 

Uispute  between,  and  lodge;   jurLsdietion  of  courts    (f'al),  44. 

Expulsion  of,  from  unincorporated  society  (Cal.),  45. 

Rights  of:    distinction  between  certificate   and   Uiw^    i(nl.i.   4(i. 

Not   to   resort   to   civil   courts    (Cal.l.   37. 

Have  no  vested  right  to  name  certain  bencliciaries  (Cal.),  .34. 

Classes    of,   and   discrimination    between    (f'al.).   ."JOSl. 

Family  of,  who  are   (Conn.),   72. 

I'annot  be   reinstated   after   death    (U.   C),    lliU-Kil. 

Reinstatement  a  personal  privilege  (D.  C),  98. 

Bound  by  laws;   ignorance   inexcusable    (D.  C),   100. 

Member  as  juror  in  suit  where  society  is  partj-   (Del.).  S2. 

Admissions   bind  beneficiaries    (Ga.),  114. 

Death  of  beneficiary   before  member   (Ga.),   108UMI. 

May  resort  to  civil  courts    (Hawaii),  128. 

Cannot  be  sued  for  assessments    (111.),  196. 

Marriage  of,  effect  on  beneficiaries    (111. I.  liis.   \'M. 

Charter    rights     (111.),    192. 

Rates,    increase   of    (111.),    10:i, 

Mistake   of.  respecting  naming  of   beneficiaries    (111.),   188. 

Prohibited  from  going  into  saloon   business   (111.),   189. 

Death  in  common  disaster  with  beneficiary;   no  pi'cr,uniptiiin  of  siuvivorship, 

(111.),  185. 
Death   in  common   disaster   with   beneficiary    (111.  I.    ISO. 
Notice   to,   of   assessments,   requirements  of    illl.i.    I.S.3. 
When  incompetent  as  witness    (111.),  183. 
Construction   of  contracts   must   favor    (III.).    180. 
Rights  to  surplus   funds   (III.),  177. 
Entitled   to   notice  of   assessments    (111. I,   lti2. 
Eligibility  as  to  age   (111.),   171, 

Murder  of  member  by  beneficiary:   wlio  i<  bcncMiiary    (111.).  173. 
Good  standing  of.   not  confined  to  showing  on  books  of  society    (III,).   108. 
Transferred  from  one  society  to  another   (111.),  1C8. 
Obligations  of,  not  affected  by  unauthorized  acts  of  society    (111.).   170. 
Insanity   of,   no  defense   in   suicide   cases    (III.),   159, 
Rights   of,   to  transfer  from   one  class  to  another    (Ind.),  248. 
Not  required   to  mandamus  to  preserve  rights    (Ind.).  248. 
Rights  of  minority  when  majority  secede   (Ind.),  244. 
Right  of,  to  transfer  from  one'class  to  another  (Ind.),  238. 
Admissions   of,  not   admissible   against  beneficiaries    (Ind.),  232. 
May   sue  to  prevent  society's  paying  invalid  claini>    (Ind.).  231. 

70 


f 


I 


1106  FRATERNAL    SOCIETY    LAW 

MEMBERS— Continued : 

Cannot    prevent    society   from    issuing'   special   contracts    (Inil.).   :i:il). 

Assessments  against;  are  they  debtors  to  society?   (Ind.).  229-230. 

Eights  of  old,   in  consolidation  of  societies    (Iowa).  292. 

Rights  of.  confined  to  the  class  to  which  they  belong  (Iowa),  282. 

Separated  into  classes;   right  of   society   respecting    (Mass.),  442. 

Membership    cannot   be    maintained    by    beneficiary    against    member's    wish 
(Md.),  408. 

Bound  by  laws  though  ignorant  of  tliem   (Md. ).  417. 

Right  of  society  to  prescribe  qualifications  for  niembi'r-lii|>   i.Mich.i,  488. 

Restrictions  on   conduct  of    (Mich.),   490. 

Acquiescence  of,  in  ruling    (Midi.),   483. 

Liberty   of.  may   be  restricted   by   fraternal   society   law    (Mo.),   580. 

Obligations  and  benefits  of,  subject  to  change    (ilo.).  .578. 

Not  all  required  to  be  l)enetit  members    (Mp.),  577. 

Receive  benefits  of  after-enacted  laws    (Miss.),  5.32, 

Rights  of,  as  to  proceeds  of  certificate   (Neb,),  (i37. 

Acting  in  judicial  capacity  not  liable  in  damages  for  acts  done  I  X.  H.),  075, 

Have  right  to  vote  upon  proposition  to  change  oljjects    (X.  .1.).  (iS!l. 

Of    society   cannot    bring   suit    for   accounting;    action    mu-t    lie    bmuglit    by 
Attorney    General    (N,    Y.),    731. 

Knowledge  of  laws  presumed    (Okla.),  810. 

Death  while  under  suspension  (Ore.),  818. 

Rights    in    insolvent    society    (Pa.),    841. 

Entitled  to  notice  of  charges  (R.  I.),  853. 

Responsible  for  acts  of  society    (R.  I.),  853. 

Rights  of,  not  affected  by  change  of  name   (S.  C),  SU3. 

Insane  member   cannot  designate   beneficiary    (Tenn.),  905. 

Right    to   cancel   niemljcrsliip   may    exist    (Texas),   939. 

Of  suspended  lodges  not   entitled  to  benefits    (Texas).  927. 

Presumed  to   know   laws  of  society    (Vt.),  959. 

Expulsion  while  insane   (Wash.),  993. 

Conditions   precedent    to  retaining  membership    (Wis.),    1925. 
MICHIGAN: 

Statute   relating   tii   tiatiTual    societies,  451-400. 

Definition   of    fraternal    beneficiary    association,    451. 

May  make  provision  for  accident,  sickness,  disability  or  old  age  benefits,  451. 

Benefit  and  expense   funds  to   be   dcri\(Ml   from   assessnu'uts,  451. 

Class  of  beneficiaries,  451-452. 

Society  exempt   ficim   application  of  this  section,  4.52, 

Incorporation    of   fraternal    societies,   452,   457-458. 

Existing   societies   may    continue   business;    provisions.   452-453. 

A]i]ioinlment   of    Insurance    Couimissioncr    as    attoincv;    MT\ic<'    of    process; 
judgments,   4.53,   450. 

Foreign  societies;  requirements,  453,  454. 

Must  file  copy  of  charter,  articles  of  association,  constitution  mul  laws.  453. 

Must  be   authorized   to   do   bu.siness   in   State   where   incm  poratcd,   453-454, 

Commissioner    of    Insurance    may    examine    books    and    accounts,    454. 


INDEX  1  107 

MICHIGAN— Continued : 

Ainni;il   rcpiirl;    license,   454-455. 

Additional   in(|uiries,  455-45(i. 

loniiijissidncr   of   Tnsuiimce   to    issuo    license,   4u(i. 

lieineorpointiiiu;    provisions,   45S-45!!. 

Ineoriior.'ilion    of   suliordinate    bodies,   4.")!t-4(i0. 

UeiU'lit     lurid    not    liable   lo   attaelinient   for    debt,    4(iO. 

False  or    lianihilent    statements    by    ollieeis,    nienibeis.    exaniinin;;    pliysieiuns, 

ele.:    pi^nalty,  400-401. 
\  iolalion    id'   statute;    revocation    of    license;    injnnetion:    piiialties,   401-402. 
Duioi;   business  wit  bout  authority.  402. 

Sooieties   exiMupt    lioni   I  he  provisions   in   tliis   statute.  402. 
Amendments   t<i   articles   of   incorporaticni.   402-40:i. 
Books,  papers  and   ollicial   records  of  societies,  40,'!. 
I  iin^oliihit  ion    of    societies;    reinsurance    of    members,    40.'!-4(!5. 
Policies   of   insurance  shall  contain   the  entire  contract   between   tlie   partii's. 

40"). 
niMision   of  funds  for  political  purposes  prohibited;   penalty,  405-4G0. 
Product  ion   of   books   and   record.s  in  court  and   before   investigation  eouiuiil- 

tees,   400, 
Societies  exempt,  4t)0. 

^licbijian    beneticiary    statute    construed    (Cal.).    48. 
W'lieu    a   contract   is   to   be  deemed  a   Michigan   conliact    (Miili.l,   407. 
MINNESOTA: 

Statute  relating  to  fraternal  societies,  494-514. 

Provisions  for  the  ])aynient  of  benefits,  494,  490. 

Class   of   beneficiaries.   494-495,  490. 

"Fraternal    beneficiary    association"    defined.    49."i. 

"Lodge   system"   defined,   495, 

"Representative  form  of  government"  defined,  495-490. 

Fraternal    societies   exempt    from    insmance    laws,    490. 

Age    limits;    persons    disqualified    for    beneficial    membersliip,    490-497. 

t'ertilicatcs;    what    constitutes    contract    between    member    and    society.    4!I7. 

Societies  nuiy  create  and  maintain  reserve  fund.  497. 

Investment  of  reserve  fund,  498. 

I'.euelit    and   expense  funds   to  be  derived   from   assessments,  498. 

LcNving   extra    assessments,   498. 

Asvc'„>inrnts;    reserve  fund  not  to  be  used  for  expenses.  499. 

lienelit     fund    not    subject    to    attachment    for   debt.    499. 

Fraternal    societies    charitable    institutions;    funds    exempt    from    taxes.   499. 

Inccnporation   of   fraternal    societies,   499-502. 

Existing  associations  sixbject  to  this  act,  .502. 

Transferring  mem1)ershi])  and   funds  to  another  association.  503. 

Foreign  associations;   licenses   to  be  renewed  annually.  .503 

Foreign  associations:    how   admitted   to  do   business,  .503-.504. 

License;   refusal  to  issue,  504-505. 

Appointment   of  Commissioner   as   attorney;    service   of   process,  505. 

greetings  of  Supreme  Lodge,  500. 


1108  FRATERNAL    SOCIETY    LAW 

MINNESOTA— Continued : 

Vi'aiver  of   constitution   and  laws  by  subordinate   bodies,  506. 

Filing  copies  of  amendments   to  constitution  and  laws,  506. 

Annual   report,   506-507. 

Examination    of    societies'    atl'airs,    507;    508-509, 

Revocation    of    license;    appointment    of    receiver,    507-508-509. 

E.xpense  of  examination  to  be  paid  bj'  society,  509. 

Societies  not  subject  to  this  Act,  509-510. 

Violations  of  statute;  penalties,  510-511. 

Detinitions^"Association,'      "domestic     association,"     "foreign     association,"' 
"State."  511,  513. 

Valuation  of  benefit   certificates,  51'2. 

Insolvency.   512. 

Detinitions — "Private    corporation."    "corporation,"    "certificate    of    incorpora- 
tion," 512-513. 

"Co-operative  life  and  casualty  companies" — fraternal  societies  not  allccted, 
513. 

General   Insurance    Laws — Section    applicable   to   fraternal   societies,   513-514. 

Political    contributions    prohibited;    penalties,    513-514. 
MINORITY: 

(Jf  lodge,   riglits  of,  where  majority  secede   (Ind.),  244. 
MINORS: 

I  jion  attaining  majority  may  sue  where  guaidian  compromised  claims   (III.), 
174. 
MISREPRESENTATION: 

By  apiilicant    (lia.l,   lilt. 

And  warranty    (ilass.),  444. 

Avoids   contract    (Md.),  408, 

Good  faith   of  member   (Neb,),  643. 

What  must  be  regarded  as  fraudulent   (S.  C. ),  861. 

See   Representations  and  Warranty, 
MISSISSIPPI: 

Xo  separate  fraternal  code  in  tlic  laws  of  Mississippi,  534, 

Sections  of  general  insurance  code  application  to  fraternal  societies,  534-549- 

Department   of    Insurance;    Commissioner;    duties,   etc.,   534-536. 

Examination  of  societies'  afi'airs,  535;   537-538. 

Failure  to  comply  with  law;  revocation  of  license,  536,  538, 

Definition   of   terms,   536, 

"Contract    of   insurance"   defined:    situs    of    contracts,   536-537, 

Revocation    of    license;    injunction,   .!)36,    538. 

Service  of  process,  539, 

Business   to  be   conducted   in   corporate   name,   539, 

Corporation  laws  applicable  to  in.surance  companies,  539-540, 

Continuation  after  charter  expires,  540, 

By-laws;    boards    of   directors,    540. 

Companies  may  acquire  and  hold  leal  estate,  540. 

Stipulations    in    contracts    regarding    court    or    jurisdiction    not    valid,    54K 

T.ife  insurance  companies  defined.  541, 


INDEX  1109 

MISSISSIPPI— Continued : 

iiriiisuraiicc;    medical   exuiiiiiiutioii   iiiiiililiiiii    incccdciit    lu    insuaiiou   of   con- 
tract;  penalty,  541-542. 

Amount  on  polieies  exempt  to  benefieiaiies,  o42. 

Amount  exeni))t  to  executors   or  administrators.  .")42. 

l''alse  or  fraudulent  statomcuis  ]i\  af;enls.  pliysieiaus.  clc;   penalties.  .■542. 

Admission  of  foreign  companies ;   provisions.  j42-.')44. 

Revocation  of  license,  544. 

Licenses   are   annual,   544-545. 

License  fees,  545-540. 

Fraternal   orders;    tees,   540. 

Publication  fees,  546, 

Societies  exempt  from   this   statute.   .■)4(l-547. 

Fraternal  orders  detined,  .547. 

Bcnelit   and    expense    fvuuls    to    lii'    derived    ticim    aN~es>mciits,   547. 

Annual   report,  547-54S. 

Meetings  of  Supreme  Lodge,  548. 

Admission   of   fraternal   societies,  548. 

Failure    to    Hie    annual    statement;    niisrepre^-enlalion :    penalties,   540. 

Copy  of  application   to  accompany  contract,  54',>. 

Misstatement  of  age  not  to  invalidate  policy,  .■)4i). 
MISSOURI: 

Statute   relating  to  fraternal   .societies,  558-570. 

Incorporation   of  fraternal  societies,  558-560;    572. 

^Vllat  associations  nuiy  incorporate,  560. 

Amending   cliarter,  560-501, 

Dues — how  collected,  501. 

Corporation  nuiy  be  formed   to  execute   trust.  561. 

Wliat  societies  may   and  may  not  be  ineorp(nated  under  this   Act.  501-502. 

Must  keep  record  of  proceedings,   502, 

Shall   make  by-laws,  etc.,  502. 

Section   may  be  incorporated   in   charter;    piu-pose   and   elt'ect.  562-504. 

jMay  acquire  property;   investment  of  funds.  504 -5115. 

Miscellaneous  associations — incorporation,  505. 

Quo  warranto  proceedings:   aiipointment  of  receiver,  etc..  565-567. 

Conveyance   of  property  rights  of  dissolved  corporation   to   new   corporaticm. 
567. 

Definition   of  fraternal   beneficiary  association,  567-568. 

Shall  have  lodge   system  and  ritualistic  form  of  government,  508. 

Shall  make  provision  for  death  benefits.  !j68. 

Benefit  ajid  expense  funds   to  be  derived  from   assessments.   568. 

Class   of  beneficiaries,  508. 

Societies   to   be    exempt   from   insurance  laws.   568. 

Continuation  of  existing  societies,  568. 

Foreign   associations,  568-569. 

Must  file  copy  of  charter,  articles  of  incorporation,  constitution  and  laws,  509, 

Appointment  of  Superintendent  of  Insurance  as  attorney,  .509,  571, 

Must  be  authorized  to  do  business  in  State  where  incorporated,  569. 


1110  FRATERNAL    SOCIETY    LAW 

MISSOURI— Continued: 

Examination  of  societies'  afTairs.  569. 

Annual   report,  509-571. 

Additional    inquiries,    571. 

Service  of  process,  571 -572. 

Permit   to  do  business.  572. 

Societies   shall   not   employ    paid   agents,   572-573. 

Beneficiary  shall  have  no  vested  right;  change  of  beneficiary.  573. 

Benefits  not  liable  to  attachment  for  debt.  573. 

ileetings  of  Supreme  Lodge,  573-574. 

False  or  fraudulent  statements;  penalties,  574. 

Refusal    to   make    report;    violation    of    statute:    injunction;    revocation   of 
license;  reinstatement,  574-575. 

Doing  business  without  license;  ju-nalty,  575. 

Societies  exempt  from  this  statute,  575-576. 

Removal  of  suits  to  United  States  courts;   jienalty.  5711. 

Construction  of  ilissouri  statute    (111.),   184. 

Construction   of  ilissouri   fraternal  beneficiary   act    (1".).   184. 

Wlien  contract  regarded  as   made   in    (Mo.),  582. 
MISTAKE: 

.\ri|uiescence    of    member    in    (111.),   1S7. 

I)f  member  respecting  beneficiaries    (111, I.   187-188. 
MONTANA: 

Montana    has    no   fraternal    beneficiary    code.    010. 
MORTALITY  TABLES: 

Courts  take  judicial   notice  of   (Kas.),  ;321-322. 

The   N.   F.   C.    table   aj^proved    (Wash.).   093. 
MORTUARY  FUNDS: 

Sacred    to    mortuary    purposes    (Xeb.).    643. 

Are    trust    funds     (X.  C).    756. 

Sep  Funds. 
MUNICIPAL   COURT: 

(tf   Cliicago.   limited    powers    of    (111.),    160. 
MURDER: 

ni   member  by   beneficiary,  who  are  beneficiaries  in  cases  of   (HI.).   173. 
MUTUAL   SOCIETIES: 

Anil    fraternal    societies,   distinction    between    (Ark.).    25. 

Fraternal  society  is  a   (Colo.),  5S. 

Mutual   benefit   associations  are   to   be  deemed    iiis\nance   companies    (Iowa),. 
268. 
MUTUALITY: 

Contract    to   re])ay    anmunt    paiil   in    by    member,    less   benefits    paiil.   is    void 
(Ala.),  7. 
NAME: 

Suit    against   society   by    wrong  '(Colo.),   59. 

Of  society  as   pro|)crty   right    (Jlicli.l.   48]. 

Property  right    in    (Xeb.),  642. 

Of    soeietv    must     not    mislead     (Xeli.).    (142. 


INDEX  Till 

NAME— Continued: 

of    soi-icty.    cliiiiiging    uf.    ilocs    imi    nfl'cct     rij;lits    nl     nn-iiilicis     (8.    t  .),    803. 

(•()ij)()riitp,   ri<;lit   to    (Wis.).    KIIS. 
NEBRASKA: 

Statute    rclatinj;   to    fiatciiial    sociotii's.   (il2-(i.S;j. 

I'ratciiial   lii>neticiai y   associations   dclincd.  (il2. 

Must   pay    doatli    bonotits.   012. 

Class   of   societies    nut    iiicluilccl    in    tliis    .Act.    Iil2. 

.\ct    not    retroactive.    (U;i. 

Hcnclit    arid   expense   funds   to   l)c   dcriM'd    Irnni   assessment-,   til:!. 

Age   limits,   013,   020. 

Class  of  beneficiaries,   (il:!,  (i2()-(i27. 

Societies  not  subject   to   general   insurance   laws.  i;l;!.   (i20. 

Where  society  may  be  sued,  (il:),  Ii2:i. 

Benefit  fund   not  liable  to  attadiment    foi-   debt,  (ill. 

Existing    societies    may    continue    doing    business.    i;i4. 

Foreign   associations;    rei|uii-eiiH>nts    for    |ierniis>iiiu    In   do    bu-incss.   liM-lil."), 
(Il(i-(il7,  032. 

Annual  report,  (il.'>-(ilO,  ()27. 

Appointment  of  .\nditor  of   I'ublic  Accounts  as  attorney;   service  of  process, 
010-017. 

I'erniit   to   do   business.    017. 

Societies  not  to  employ   i)aid  agents.  017. 

Cliaiige  of  beneficiary,  017. 

Aleetings  of  Supreme  Lodge,  017. 

Failure  to  make  report;    nuiladniinistratiou :    revocation   of   license,   tils.  02!i, 

Doing   business   without   authority;    penalties,   018, 

obtaining  money  by  fraudulent  rcjiresentafions;    ])enalties,  01!). 

Medical   examination   of  applicants   for   memliersliip,   010, 

Organization  of  fraternal   societies,  019-020. 

Investment    of    funds,    020-021,    028-020, 

Filing  copy  of  constitution  and  by-laws,  021. 

Contracting   with    other    societies   to    giunantee    |)ayiHeiU    of   death    benefits, 
etc.,   021-022. 

Consolidation    of   societies:    reinsurance.   (i22. 

\'i(datiou   (d'  statute;    punishment,  023, 

Frauds   on    life   insurance  companies:    ]i\uiishmeut.    02 -t. 

^lutual   benefit    associations,   024. 

Articles  of  incorporation,  025, 

1)u])lication  of  names,  02.5, 

'Anuinnt   payable   under   certificate   liniileil    by    aniouut    derived    from    assess- 
ment,  625. 

Requirements    preliminary    to    doing   bu.siness,   025-020. 

By-laws  and  notices  must  state  objects  of  assessments.   020. 

E.xamination  of  books  and  accounts,  627. 

Certificate  of  incorporation,  629-630, 

Fraud  of  agent,  physician,  etc.;  penalties,  630. 

Natural   or   stipulated   premium    plan   e(unpanies,  0.30-031. 


1112  FRATERNAL    SOCIETY    LAW 

NEBRASKA— Continued: 

l-'ees   payaljle   to  the   Slate.   ();il-(j:i2. 

Societies  exempted  fioin   the  pr()vi>iniis  of  tliis  Act.  032. 

Retaliatory   clause   as   between    States,   ua.i. 

Deposit  of  security  fund  with  Auditor  of  Pu1>lie  Aeeount^^.  (133. 
NEGLIGENCE: 

Company    liable   for   agfiul's    (Hawaii).    ll'.K 

Soi-icty    liable   lor  acts   of  its  surgeon    (C'al.).   37. 
NEGOTIATIONS: 

Do   not   waive   forfeiture    (Miiin.i.   .122. 
NEVADA: 

Nevada   has  no  fraternal  society  code.  657. 

General  insurance  laws   not  applicable  to  fraternal   societies.  6.57. 

Act  of  March  29.   1907,  relative  to  interpleader,  applicable  to  fraternal  so- 
rii'ties.    (■|."i7-lJ.5S. 
NEW    HAMPSHIRE: 

Statutes    relating    to    fraternal    societies,    060-673. 

Definition  of  fraternal  beneficiary  association,  660. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  000. 

Class  of  beneficiaries,  600. 

Existing  societies   may  continue  business,  660-661. 

Admission  of  foreign  corporations;   provisions,  661. 

Must  be  authorized  to  do  business  in  State  where  incorporated.  001. 

Examination   of  societies'   affairs,   661,  669-670. 

Annual  statement,  661-663,  668-669. 

Additional  iuijuiries,  603. 

Appointing    Commissioner    of    Insurance    as    attorney;     service    of    process, 
003-004. 

Permit  to  do  business.  604,  009,  070-071. 

Organization  of   new   and  re-incorporation   of   old   societies.  004. 

Societies  not  to   employ  paid  agents,  004. 

Beneficiary   cannot   pay   member's   dues,   664. 

Benefit  fund  not  liable  to  attachment  for  debt,  004-00.1. 

Jleetings   of   Supreme   Lodge,   00.5. 

False  or  fraudulent   statements   by   officers,   physicians,  etc,  005. 

Faihu'e  to   file   report;    nialadniini-ti;ition:    revocation    uf    lii'ense;    reinstate- 
ment,   005-000. 

Doing  business   without  license;   penalty.   0<iO.   072. 

Societies  not  subject  to  this  Act,  60(i,  009. 

Provisions  of  the  insurance  code  applicable  to  fraternal  societies.  007-084. 

Policies  must  contain  the  entire  contract  between  the  ])arties.  007. 

Diversion   of   funds   for   political  purpeses,  007-008. 

Production    of   books   and    records    before    courts    and    in\('stigalion    coniinit- 
tees.    008. 

'"An   act    piaciiii;   cerlMiii    corporations,   associations,   etc..   under   the  jniisdic- 
tion   of   the    liisinancc    Commissioner,"   608. 

.\lu~I    lile   copy    of   charter    and   by-laws,  etc.,   with    Conunissioner,  0(i9. 


INDEX  1113 

NEW  HAMPSHIRE— Continued: 

\i(il;ilioM    of   st;itiac;    penally,   iilj'.l,   ()72-(i73. 

Maladministration;   revocation   of  license.  Olin-tiTO. 

Licensing  agents,  671-672. 

Fee.s    of    Commissioner,    (>7.'i. 
NEW  JERSEY: 

Statute    relatin;;    to    frati'iiial    societies,    (!77-llS4. 

Delinition   of  fraternal  society,  677. 

Benefit  and  exi)ense  fnnds  to  be  derived  from  asscssmcMts.  (i77. 

Class   of   beneficiaries,   G77. 

Fraternal  societies  exempt  from   insnrance  laws.  677. 

Existing  societies  may  continue   tip  do  bnsiness.  (i77-(i7S. 

Admission   of   foreign   societies.   (i78. 

Must  file  copy  of  cliarter,  articles  of  association,  const  it  iilion  and  laws,  078. 

Appointment  of  Commissioner  as  attorney;   service  of  i)rocess,  078,  080-681. 

Must   be  authorized   to  do   business   in   State   wliere   incorporated,  678. 

Examination   of   .societies'   books    and   all'airs,   078.   082. 

Annual   report,   078-080. 

Additional  inquiries.  680. 

Permit   to  do   business,  681. 

Societies   shall    not   employ    ])aid    agents.    081. 

Beneficiary    shall    not    pay    member's   dues,    081. 

Benefit  fund  not  liable  to  attachn.ient  for  debt,  OSI. 

Meetings  of   Supreme  Lodge,  681-682. 

False   or   fraudulent   statements   by   officers,   physicians,   etc.;    penalty,   682, 

Failure    to    make    report;    maladministration;    revocation    of    license;    rein- 
statement, 6S2-0S.1. 

Doing    business    witliont    authority:     ])enalty.    OS:H. 

Societies  exempt  from  the  operation  of  this  Act,  08:3-084. 

Fees  payable  to  Commissioner  of  Insiu-ance,  084. 
NEW  MEXICO: 

Statute   applicable   to    fraternal    societies.   008-703. 

Annual  report.  098-700.  701. 

Status  of  fraternal  societies,  700. 

Fee  for  filing  annual  report.  700. 

Status    of    snbsenuently    organized    life    and    nc<'ident    associations.    700-701. 

Certificate  of  authority  to  do  business.  701. 

Doing  business  without  authority;   penalty.  701. 

Appoint  of  Superintendent  of  Insurance  as  attorney:  service  of  process,  702. 

Admission  of  foreign  societies;  provisions,  702-703. 
NEW  TRIAL: 

Xew  evidence  must  be  such   as  to  probably  change  result    (ilinn.l.  510. 
NEW   YORK: 

Statute  relating  to  fraternal  societies,  704-714. 

Incorporation  of  fraternal  societies;   license,  704-705. 

Keincorporation   of    existing   societies,    705-706. 

Admission   of  foreign   societies,   706-708. 

Minimum   amount   of   insurance   necessarv,   706. 


1114  FRATERNAL    SOCIETY    LAW 

NEW  YORK— Continued: 

Examination  of  societies'  affairs,  700-707,  71'2. 

Maladministration;    revocation   of   license.   707-708. 

Wlien   examination  of  M)ciety's   affairs   not   necessary.  708. 

ilutual   benefit    fraternities;    exempt   from   insurance   laws.   70S. 

Societies  to  enact  necessary  laws.  708-709. 

Must  file   with   Snperintendent   of  Insurance   copy   of  constitution  and  laws, 
709. 

Agreements   for  IjeneKts:    amount   limited.   709-710. 

Sources   of  benefit,  fund.  710. 

Benefit    fund   shall    not    be   diverted   to   any    other   piupose.   710. 

Annual   report.  710-711. 

Additional    inquiries,    711-712. 

Refusal    to  nmke   report;    maladministration;    revocation   of  license,   712-713. 

Violation   of  statute;    pimishment,   712-713.  • 

Eiglits  of  members;  notices  of  assessments,  713. 

Benefit   fund   not  subject   to   attachment   for   debt,   713. 

Application  of  this  Act;  societies  exempt,   713-714. 

Consolidation    of    societies;    reinsurance;    transfer    of    menil)ership    or    funds, 
714. 
NEXT  OF  KIN: 

\V!io  are  (da.).  112. 
NIECE: 

By  affinity  as  beneficiary    I  Iowa).  274-275. 
NON-FORFEITURE   STATUTES: 

I'lintraets    of   fraternal    societies    not    under    (^lo.).    .578. 
NORTH  CAROLINA: 

Statuto   ic-hiOnji   to    fraternal   societies.   733-745. 

What    laws   applic;ible    to   fraternal    societies.   733. 

Definition    of    fraterniil    society,    733-734. 

Benefit  and  expense  futuls  to  be  derived  from  assessments.  734. 

Meetings  of  supreme  f.'Overiiinj^'  body.   734-735. 

Conditions   precedent    to    admission    to   do    business.    735. 

Must  file    with    Insurance   Comnii>^ionei-    copy    of   charter,    articles    of   asso- 
ciation, by-laws,  etc.,   735. 

Contracts    must    be    in    accord    with    charter    and    by-laws.    73(). 

Must  keep   in   treasury  amount    e(|mil   to  one  regular   loss  assessment.   730, 
744. 

Revocation   of   license.   730. 

Diversion    of    funds    for    |)nMtiial    purposes:    penalties.    73(i-7:i7. 

Production    of    book-,    ;ind    records    in    court     or    licfme    invi'stigating    com- 
mittees,   737. 

Violation    of    this    Ai-I,    penalties.    737. 

Contracts  of  insurance   Mibjcct    to   State   laws.   73S. 

Statements    in    application    shall    bi'    dei'iiied    representations,    not    warranties, 
738. 

Stipidations  as   to    juiisdict  ion    :niil    limitation    of   actions    foihiilden.   7.'i8. 

Mortality    table    u>cil    in    lif^uriiij;    e\|ieclnncy    of    life.    73S-7-10. 


IXDKX 


1115 


NORTH  CAROLINA— Continued: 

I'lusenL    \:\\\u-    of    Miuniilirs     table   used    in    tijjtiriiif;,    74U-7-tl. 

Kalse  or   tiMinluUiit   stuteiiiunts  niiule  by  agents,  ]>liv.siciaiis,  etc.;   penalties, 
741. 

('(iinpai).v    iiiiikiiin    false   slalciiieiils ;    peiialtx.   7H-742. 

Kefusal    to    exliiliit    booUs    on    deinaml;     penalties,    742. 

Meilieal   exaiuiiial  ion   condition    precedent    to   issuance  of  cerlilicale,  742. 

Ilusbaiiil    iiiav    iii-;u]<'    life    fur    benelit    of    wife   and    cbililren,   742. 

iienelit    fund    not    ^iibjecl     tci   creditois'    <-lainis,    74.". 

Beneficiary    may   maintain    action    in   (jwii   nanu'.   74:i. 

i^iarried   women    as   beneliciaries.   74H. 

Life   insurance   companies   defined,   74;). 

Anunmt   (d   benelit    must    lie  stated  in   contract,  74.'J. 

Must  exliibit    booUs  an<l   papers  to   Insurance  Coniuiissioner  on  demand,  744. 

Annual   reports,   74 1. 

Duties   of   Insuiancc   I  nmmissinner,    744-74."). 

Act    covers   all    insur.ince    couipanies,    74.'i. 
NORTH  DAKOTA: 

Statute    relalini;    to    fraternal    societies.    7.').S-7lis. 

Definition  of   fraternal  beneficiary  society.   7.">.''. 

Shall  make  jirovisiou  for  payment  of  benefits  in  case  of  dejith,  7.kS.  . 

Benefit  and  e.xpense   funds   to  be  deriveil  from  assessnuMits.  7.")S. 

Societies    exem])t     from    in.^iuance    laws.    7.>>S-7.")!). 

May  create   and    uuiintain   a  reserve   fund,   701). 

Kxisting    societies    uuvy    continue    to    do    business.    7.)!!. 

Admission  of   foreign   societies;    reipiirements.   7o!)-7liO. 

Jiust   be  authorized   to  do   business  in   State   where   incorporated:    tiling  cer- 
tificate  of   authorization,   7.59-7110. 

Examination    of    societies'    alVairs.    7.ill-7(iO. 

Annual    report,   7UO-7(i2. 

Addiiunnil   inquiries,   7l)2. 

Ap|>oiutiuent   of    Commissicnier    as    attorney:    ser\  ic/    of    prucess.    7(12. 

Permit  to  do  business.  703. 

filing  copy    of   ;irticles   of   incorporation,   constitntinu    and    laws.   703. 

Sncieties  not   to  em|doy   paid  agents,  703. 

Beneliciaries   cannot    pay    members'   dues,    7ti3-7()4. 

Benefit  fund  not  subject  to  attachment  fin-  debt.  7(i4. 

Bates  of  assessment  to  be  not  lower  than   indicated   neies^ary    by    Fraternal 
('<ingress    mortality    table,    704. 

Fr;iteriuil   Congress  mortality   table,   7(i4-7(iti. 

Meetings  of  legislative  or  governing  body,  7li7. 

Kalse    or    frauditlent    statenu-nts    by    oflicers,    ]ihysicians.    etc.;    penalty.    7ti7. 

Kefusal   to   make  statemcut :    mal.idiiiinistratiou :   revcicafion  of  license;    rein- 
statement,  707-70S. 

Doing    business    without    authority;     ]ienalties,    7liS. 
NOTICE: 

Public  is  charged    \\'\\\\.  of   limited  powers   of  societies    (111. I.    li:!i. 

Printing  and  mailing  of.  regarding  assessments    (111.1.   102. 


1116  FRATERNAL    SOCIETY    LAW 

NOTICE— Continued: 

Kequiu'iueuts  of  assessment   (111.)-  183. 

Courts   do  not  take,  of  foreign  statutes   (Kas.),  320. 

Judicial,  taken  of  mortality  tables    (Kas.),  321-322. 

Public  cliarged,  as  to  corporate  powers  (Kas.),  328. 

Of  assessments  under  amendments    (Minn.).  531. 

To  member  of  charges  (Mo.).  tiOO. 

Of  assessments    (Neb.),  653. 

Of  laws  imputed  to  member   (N.  J.),  (i'JU. 

Respecting  assessments    (N.   C),   753. 

Member  entitled   to.  before  trial   (R.  I.),  853. 

^Meiiibci'  c'.ilitled  to.  of  amendments  to  laws   (Texas).  !)3S. 

See   Assecsments,  Contracts,  Forfeiture,  Suspension. 
OBLIGATIONS: 

Of  societies  not  increased  by  taking  benefits  of  laws   (111.).  Kil. 

Of  member  not  affected  by  society's  unauthorized  act    (111.),   1711. 
OCCUPATIONS: 

"Saloonkeeper,"   definition   of    (Ala.),   12-13. 

Assessments  for  hazardous   (Colo.),  54-55. 

Hazardous;   assessments;   forfeiture  (Colo.),  54-55. 

After-enacted  laws  respecting  (Conn.).  70. 

After-enacted  laws  valid   (111.).   lS!t. 

Members  engaging  in  proliibited   (liid.).  240. 

Member's  engaging  in  prohibiteil:   waiver  of  forlciturc   (Ind. ).  233. 

Prohibited;  after-enacted  laws   (Kas.),  313. 

After -enacted  laws  as  to,  unreasonable   (Minn.).  525. 

Prohibited;    saloonkeepers    (ilinn.).   525. 

Change  of;   forfeiture   (Jlinn.).  522. 

Member  entering  proliiliited   (Mo.).  591. 

What  does  not  constitute  chaiifje  of   (X.  C. ).  747. 

After-enacted  law  valid  (X.  J.i.  (i!l(l. 

Member  has  vested  right  to  fulluw    any.  not  prohibited    iX.  V.),  717 

After-enacted  laws  prescribing,  not  xalid  (X\  Y.),  717. 

"Cattle  shipper"  defined  (Vt.).  050, 

What  is  meant  by  term  "occujiation"   (Wis.).  102S. 

Prohiliitod  by  after-enacted  laws   (Wis.i.   1023. 

See  Forfeiture. 
OFFICERS: 

Local,  are  agents  of  socicly   ((  olo.).  5S. 

Agency  of  local   (D.  C).  00. 

And  agents,  distinction  between   (Ca.).  107-lOS. 

Local   collecting,   agency   of    (Ida.).    130. 

Of   local   lodge,  agency  of    (111.).   1(57-168. 

Acts   of  chief,  bind   society    (111.).   182. 

Powers  of  president  (III.),  183. 

Absence  of  collecting  (Iowa),  205, 

Waivers  by   (Iowa).  207. 

Service  of  summons  against  society  upon   (Ind.).  220. 


INDEX 


1117 


OFFICERS— Continued : 

J.ociil.  aj^ciicy  of   (Kus.J,  3:iU. 
Agency  of  local   (Kas.),  318. 
Assistant   to  collecting;   agency    (Kas.  i.  31(1. 
Local,  cannot  waive  laws   (Mass.),  44.5. 

Oilicial  actions  prcsnnicd  to  be  correct   ami   lawful    iX.   Y.),  730. 
Removal  of.  at  will   (X.  Y.),  729. 
Sec  Agency  and  Waivers. 
OHIO: 

Statute  relating  to  fraternal  societies,  774-790. 

Fraternal  beneficiary  association  defined.  774. 

Lodj;e  system  dclinecl.   774, 

Representative  form   of  government  defined.  774-775. 

Societies   shall   be   exempt  from  general   insurance   laws.   77.'). 

^lust  provide  for  the  payment  of  death  hciielit>.  7V."i. 

Class  of  lieneficiaries,  775. 

Age  limits  of  members,  775-776. 

Certilicate   must   specify   maximum   amount   of   hcnclit^    iircnidcil,   77(i. 

What  constitutes  a.  contract  of  insurance,  77(i. 

What  societies  may  create  and  maintain  a  reserve  fund,  77C. 

lienctit  and  expense  funds  to  be  derived  from  assessments.  770.  ' 

Investineiit  of  funds,  770-777. 

]'owers  to  levy  extra  assessments,  770-777. 

Distribution  of  funds,  777. 

Organization  of  fraternal  societies,  777-780. 

Status  of  existing  societies;   reincorporation,  anu'ud iits,   780. 

Consolidation  of  societies;   transfer  of  membership  or  funds.  780. 

Members  must  exhaust  remedies  of  societies  before  resorting  to  civil  courts, 

781. 
Annual  license,  781. 

Admission  of  foreign  associations;  requirements.  7S1-783. 
Power  of  attorney;  service  of  process,  783. 
Jlectings  of  legislative  or  governing  body,  783  784. 

Officers  and  members  not  personally  liable  for  obligations  of  society,  784. 
Waiver  of  provisions  in  constitution  and  laws.  784. 
<5rand  lodges  to  be  treated  as  federation  not   as  single  state  organizations. 

784. 
Kiling  aiiieudments  to  constitution  and  laws,  784-785. 
Annual  re|'orts,  785. 

Examination  of  affaii's  of  domestic  associations,  785. 
A'iidation    of   law;    nuUadniinistration;    injunction;    ap]iciintnu'iil    of   receiver. 

785-786. 
Examination  of  affairs  of  foreign  associations,  787-788. 
Refusal  to  submit  to  examination;   revocation   of  license.  787. 
Revocation  of  license,  787. 
What  societies  not  subject  to  this  act,  788. 
False  or  fraudulent  statements;   penalties,  788-789. 
Doing  business  without  license;  penalty,  789, 


1118  FRATERNAL    SOCIETY   LAW 

OHIO— Continued: 

\'ioI;itiun  of  stalutc;  penalty,  789. 

Definitions,  789-790. 

Deputy   commissioner   to    |ii-iroiiii   duties   in   absence   of   commissioner  of  in- 
surance, 790. 

Previous  statutes  repealed.  7110. 
OKLAHOMA: 

Statute  relating  to  fraternal  societies,  790-SlO. 

FrateriTal  bencticiary  association  defined,  79(i-707. 

Must  make  provision  for  payment  of  death  benefits,  790. 

Expense  fund  to  be  derived  from  assessment.s,  790. 

Class  of  beneficiaries.  790. 

E.xemption  from  provisions  of  insurance  laws,  790. 

Jlay   create   and  maintain   a   reserve   fund,   790. 

Existing  associations   uuiy   continue  business,  797. 

Admission   of    foreign   .societies.   797-798.  i 

Filing  copy  of  constitution  and  laws,  797. 

Power  of  attorney;  service  of  process,  797:  SOO-SOl. 

Examination  of  societies'  affairs,  798;   801-802. 

Annual  report;  license,  798-800. 

Additional  inquiries,  800. 

Permit   to   do  business,  800. 

Incorporation  of  fraternal  societies,  802-803. 

Reincorporation,  803-804. 

Powers  and  privileges  of  societies  so  incorporated.  804-805. 

Shall  not  employ  paid  agents,  805. 

Beneficiary  has  no  vested  right,  805. 

Benefit  fund  not  subject  to  attachment  for  debt.  805. 

Rates  of  assessment  to  be  not  lower  tliau   indicated   necessary  by  Fraternal 
Congress  mortality  table,  805. 

Fraternal  Congress  mortality  table,  805-808. 

Meetings  of  legislative  or  governing  body,  808. 

False  or  fraudulent  statements;  penalties,  808. 

Refusal  to  make  report;  penalty,  808-809. 

Maladministration;    revocation  of   license;    reinstatement,  809. 

Doing  business   without   authority;    penalties,   809-810. 

Retaliatory   clause,  as  between  states,  810. 

Act  applies  only   to  fraternal   beneficiary  associations.  810. 

What  societies  not  subject  to  this  act,  810. 
OLD  AGE: 

Benefits,  statute  respecting,   construed    (Cal.),  48. 

See  Benefits. 
OPIATES: 

Death   from,   through  accident    (Mo.l.   004. 

Ovei'dose  of  ])oison:  suicide   (Iowa).  294. 

Use  of   (La.K  304. 

See  Suicide. 


INDMX  1119 

OPINIONS: 

(If  |)li\  siciiuis  as  to  suicide  (111.),  175. 
Of  |iliysii-inii  lis  (.'vidence  (Nel).),  056. 
Sec  Evidence. 
OREGON: 

Oregon  has   no   fratcinal   society  code,   81.'{. 

Fraternal  societies  exempt  from  general  insurance  laws,  HI.'!,  SI  4,  slli. 

Certain   sections   of   the  general    insurance   code.   8l;!-Hl((. 

Tiieenses  to  companies;   conditions,  813. 

License  fees,  tines,  taxes,  etc.,  813-815. 

Examination  of  companies'  allairs.  S14. 

Power  of  attorney,  814. 

Annual  report,  814-815. 

".\n   Act  to   license  and   regulate   lifi^  and   c-asualty    insurance  luinpanics  and 

societies,"   81(1. 
Insurance   commissioner    lias    power    to    decide    wiiellier   an   association    is   a 

fraternal  society,  81(1. 
Siicli  decision  to  be  final.  81(i. 
ORGANIC  LAW: 

Drfillitioll  <.t    (111.).    171. 
ORPHANS: 

\\  hci  are   (Minn.).  .523. 
PARALYSIS: 

Delinition  of   (Mo.).  G03. 
PAROL: 

Contract,  wlicn  valid   (.\rk.).  27-28. 
Evidence  recei\cd  to  \aiy  contract    (Kas.).  3f2. 
See  Contract  and  Evidence. 
PARTNERSHIP: 

Society   is   not    (Midi.).  493. 
Unincorporated  lodge  is  not   (Kas.).  .324. 
Sec  Society. 
PAYMENT: 

(Jf  taxes;   levy  illegal   (III.),  182. 
■|'o  wrong  claimant   (Iowa),  275. 

Suit  for,  by  beneticiary  against  stranger   (Ind.),  231. 
Of  assessments  after  nieiiiber's  death    ('Ind.),  235. 
Presumptions  as  to  (Mich.),  480. 
Sec  Benefits,  Forfeiture,  Assessments. 
PENALTIES: 

For   failure  to  pay  losses  promptly   (Ark.),  2(i. 
PENNSYLVANIA: 

Statutes  relating  to  fraternal  societies,  822-834. 

Incorporation   of   fraternal   societies.   822-825. 

Powers  and  duties  when  so  incorporated,  822-825. 

Charter;  what  it  must  show,  824. 

Newspaper  publication  of  inteutiou   to  ajiply   for  charter,  824. 


1120  FRATERNAL    SOCIETY    LAW 

PENNSYLVANIA— Continued: 

;Mi>ii'lhm('uii>   iei:|uiieineiits.   824-82.5. 

AninuU  report,  825-826. 

Examination  of  societies'  boolcs,  820. 

Refusal  to  nial<e  report;   penalty.  820. 

Bonding  of  officers  of  societies,  820-827. 

Filing  certificate  to  be  bound  by  provisions  of  tliis  act,  827. 

Creation  of  subordinate  lodges.  827-828. 

Benefit  and  expense  funds  to  be  derived  from  assessments.  828. 

Class  (if  beneficiaries,  S28. 

Fraternal  societies  exempt  from   insurance   laws,  828. 

Exemption  from  taxes,  828. 

Filing  copy  of  constitution;   laws,  changes  or  amendments.  828. 

Annual  report:    form   of,  828-830. 

Failure    to    file    statement;    penalty,  830. 

Limited  powers  of  insurance  commissioner,  830. 

What  societies  not  subject  to  this  act,  830-83L 

To  whom  benefits  are  payable  on  death  of  beneficiary,  when  no  new  designa- 
tion is  made,  S3L 

Power  of  attorney:  service  of  process,  831-833. 

"An  Act  to  punish  frauds  upon  life  insurance  companies  by  agents,  physicians 
and  others,"  833. 

"An  Act  to  enable  minors,  above   the  age  of  eighteen  years,  to  contract  for 
membership  in  fraternal  beneficial  societies,"  833-834. 
PHYSICIAN  AND  PATIENT: 

Privileged    communications    (Ida.),    13!)-140. 

Opinions  of,  in   suicide  cases    (111.),   17.5. 

Privileged   communications,    when    (Iowa),   292. 

Privileged  communications   between    (Ind.),  239. 

Physician  not  privileged  witness    (Ind.),  231. 

Communications  between  (Mich.),  480. 

Physicians  testifying;   waiver  of  exemptions   (Minn.).  .)18. 

Relations  of   (Mo.).  584. 

Physician  may  be  made  competent  witness   (X.  C),  749. 

Waivers  of  statutory  privilege  void  unless  made  in  court  (K.  Y.),  721. 

When  relation  exists   (X.  Y.),  721. 

Relations  between   (Ohio),  793. 

Physician,  testimony  of  (Wash.),  992. 

Where   relation   dne.^   not   exist    (W.    \'a.),   1000. 

See  Privileged  Communications  and  Waivers. 
PLANS: 

Change  of.  by   societ.v    (Colo.),  55. 

Ciiange  n(    (Ind.),  245-247. 
PLEADINGS: 

Necessary   averments    (Ind.),  237. 

Promise  to  pay:  defenses  need  not  Ijc  negatived   iliid.).  229. 

Averments  necessary   (Ind.),  232. 

Defenses  need  not  be  negatived    (Ind.).  229. 


INDEX  .  1121 

PLEADINGS— Continued : 

Must   raisi'   cuirsticiri    of  clifiiliility   of   iM'iioliciiirv    (Kas.).   •tl"). 

Performance    of   ])r('te(lent    conilitioiis    (Kas. |,   313. 

Rule  as  to   Miisre|Mesentation    (Mo.),  5fl2. 

Forfeitures    (Mo.).   .'),SS. 

And  proof,  requisites  of,  in  case  of  foreign  society   (Mo.).  .583. 

Forfeiture  must   be  set   up  specially   (S.  C),  861. 
POISON: 

Deatli  fioni   overdose  of;   suicide   (Iowa).  ■2'.t4. 

Accidental    poisoniiii;;    suicide    (Mich.),   480. 

See  Suicide. 
POLICY: 

Of  society   will  not   be  interfered  willi   liy   courts   iCal.').  47. 

See  Courts  and  Powers. 
POST  MORTEM: 

Assessment   society:    Inirden   of   proof    (Ark.),   23. 

Plan,    cliange    from,    to    .idvance    assessments,    valid    (Colo. I.    .")o. 

See  Plans,  Assessments,  After-Enacted  Laws. 
POWERS: 

Of  societies  respecting  compromises  (Conn.),  72. 

Of  Supreme  Lodge   (111.),  192. 

Limited,  of  societies;  public  charged  with  notice  of    (III.),   16'J. 

Reserve,  to  amend  laws    (111.),   193. 

Legislative,  cannot  be   delegated    (111.).   10.3. 

Piovisions  requiring  bringing  suit  in  limited  time  valid  (111.),  100. 

Of  president  of  society   (111.),  183. 

Of   chief   officials   to   bind   society    (111.).    182. 

Limited,  public   is  charged  with  notice  of   (III.),  169. 

Corporate,  public  charged  with   notice  of    (Kas.),  328. 

Corporate,  of  society,  limitations   (Kas.),  312. 

Of  societies,  knowledge  of,  imputed  (Kas.),  312. 

Corporate,  limited    (Neb.),  641. 

Legislative,  cannot  be   delegated    (Tenn.).  902. 

Of  societies,  power  of  expulsion  included  in   (R.  I.).  8.54. 

See   Societies. 
PREFERENCES: 

Of  creditors   (Cal.),  36. 

No  claim   for  benefits  entitled  to   (N.  Y.).   731. 
PREMIUM: 

Contract   not  effective   until   payment  of   first    (Ark.),  23. 

Prompt   payment   of    (Ind.),   229. 

See   Assessments. 
PRESIDENT: 

Of   society,    powers   of    (111.),    183. 
PRESUMPTIONS: 

Against  suicide   (Ark.),  19. 

Of   legality   of  marriage    (Colo.),  36. 

Of   death    from    absence,    when    (111.),    170. 
71 


1122  FRATERNAL    SOCIETY   LAW 

PRESUMPTIONS— Continued : 

As  to  statute  law   in   foreign   Stnlc    (lll.i.   171. 

Against  suicide    (111.),  178. 

Of   good    standing   to   continue    (11!.),    180. 

Of  sanity  in   suicide  cases    (111.  I.  181. 

Xone  of  survivorship  in  deaths  in  common  disaster   (111.),  185. 

Sanity  presumed  in  absence  of  proof   (111.),  181. 

Statute  of  foreign  State;   presumption  as  to    (111.)^  171. 

What  will  be   indulged  in    (111.),   188. 

Burden  of  proof  (Iowa),  287. 

That  beneficiary  named  is  competent   to  take    (Iowa),   293. 

In  favor  of   suicide    (Ind.).   241. 

In   suicide  cases    (Ind.),  232. 

Of  death   from   absence   (Kas.),  313-314. 

Of  death   when  fugitive  is  absent   (Ky.),  33G. 

That  death  was  by  accident  (La.),  364. 

Presumptions  against   suicide    (ild,),  415. 

As   to  payments    (Mich.),  480. 

In  suicide  cases   (Minn.),  517. 

As  to    common    law    being    same    everywhere    (Mo.).    596. 

As  to   foreign   statutes    (Xeb.),   634. 

Statutes  of  foreign  States;  presumptions  (Xeb.),  634. 

Against  suicide   (Ore.).  820. 

None  in  favor  of  legality  of  assessments    (ienn.),  904. 

That  laws  are  known  to  members   (Va.),  978. 

"With  respect  to  seal   (Vt.).  960. 

Respecting  suicide    (Wis.).   1029. 
PRIVILEGED  COMMUNICATIONS: 

Physicians;    wiii\ei'    of   (•xeiii]>'.ioiiN    (Ida.),    139-140. 

To    physicians,    waiver    of    (Ida.),    139-140. 

Privileged  communications    (Iowa),  292. 

Physician  is  not  privileged  witness  (Ind.),  231. 

When  privileged  communications   (Ind.),  239. 

What  are  privileged  comnmnications   (ISIich.),  482. 

Before  lodge  trials    (Mich.),  480. 

Privileged  communications   (Mo.),  584. 

!May  be  made  competent   (N,  C),  749, 

Of  physicians  as  evidence   (Ohio),  793. 

AVhen  cannot  be  admitted    (N,   Y,),  721, 

Of  physician    (Wash.),  992. 
Privileged   connnunications    (W.   Va.i.    1000. 
See  Evidence,  Physician  and  Patient,  Waivers. 
PROCESS: 

See  Summons, 
PROHIBITED    OCCUPATIONS: 

"Salooiikrcpcr,"   definition    of    (Ala.),    12-13, 
See  Occupations, 


PROMISSORY  WARRANTY: 

Re(|uires    cessation   from    fornior    piucticc    (Iiid.). >  2-13. 

Excessive   use   of   intoxicating   liijuors    (Ind.),   243. 

Breach  of;    excessive  indulgence   in  liciuor    (hid.).   237. 

Soc  Warranty  and  Contract. 
PROMOTERS: 

Contracts   of    (111.),    i;)2. 

Contracts   of    (Iowa),   279. 

Acts   of,   iiiit   liinilinji  on   society    (N.   D.).   7li!l. 

See   Contracts. 
PROOFS  OF  LOSS: 

\Vai\cr  of   (Ark.),  20. 

Proof   of   by-laws    (Ark.),   22. 

Death,  proof  of;   requisites    (Cal.),  34. 

Proofs  of  death,  waiver  of   (Colo.),  58. 

I'rool-i  uf  death,  waiver  of   (Fla.).   102. 
PROOFS  OF  LOSS: 

Proofs  of  death  waived  hy  denial  of  liability   (111.).  IS!. 

Denial  of  statements  in  death   proofs  by   benelieiary    (111.),   191. 

'"Satisfactory  proofs  of  death,"  definition  of    (111.),   174. 

Proofs  of  death  admissible  in  evidence    (Til.),  191. 

Coroner's   verdict  admissible   in   evidence    (111.).   174, 

Statements    in,    may    be    denied    by    beneficiary    llicmgh    beneficiary,   offered 
proofs   in  evidence    (111.),   175. 

Proofs  of  death,   definition   of,  when   satisfactory    (111.),   174,  . 

Proofs  of  death    waived   by   denial    of   liability    (Iowa).  278,,  293,  286. 

Waiver  of   (Ind.),  227,  228. 

Proofs  of  death  in  disappearance  case   (Kas.),  323.  ,    , 

Proofs  of  death,  admissions  by  beneficiary  in   (K^.),,327. 

Proofs  of  death  waived  by  refusal  of  blanks   (Kas..),  319. 

Waived  by   denial  of  liability    (La.).  361. 

Requirement  that  they  be  made  within  certain  time,  valid   (.Md.).  416. 

Proofs  of  death  waived  by  denial  of  liability   (Md.,),.41Q. 

Proofs  of  death;    delays    due    to    society    (Mich.),  ,  491. 

Waived  by  denial   of  liability    (Mich.),  487.  ,     , 

Furnishing  blanks  does   not  waive   defenses    (Jlo.),  590. 

Proofs  of  death  waived  by  denial  of  liability   (Mo.),  583., 

Proofs  of  death  waived  by  refusal  to  furnish  blanjis  and  denial  of  liability 
(Mo.),  600. 

Proofs  of  death  waived  Iiy  denial  of  contract    (X.   C),  753. 

Proofs  of  death  waived  by  denial  of    liability    (N.    C),    746. 

Proofs  of  death   admissible  in  evidence   (Neb.),  635. 

Value  of  proofs  of  death  as  evidence   (N.  D.),  771. 

Proofs  of  death;   suit  to  be  brought  in  limited  time  ,(^.  Y.),  715. 

False  statements  in  proofs  of  death   (Ore.),  817. 

Proofs  of  death   to  be  furnished  before  suit   (Ore.),- ,818.    , 

Proofs  of  deatli   furnished   by   agent  not  evidence    (Qrp.),  820. 

Proofs  of  death   prima   facie   evidence   of  cause  of  death    (Pa.).   847. 


1124  FRATERNAL    SOCIETY    LAW 

PROOFS  OF  LOSS— Continued: 

Waived  by  denial   of  liability    (S.  C),  860. 

Effect  of   delivery   to   agent    (S.  D.),   882. 

Proofs   of   death,  when   not   required  from   beneficiary    (Texas).   930. 

False  statements  in  (Texas),  924. 

Requirements   for    (Utah),   950. 

Delay  in  furnishing  blanks   (Wash.),  995. 

False    statements    in    (Wash.),    994. 

Waived  by  denial  of  liability    (W.  Va.),   1002. 

False  affidavits   (W.  Va.),  1002. 

Proof.s  of     death  as  ])rima   facie  evidence  of  suicide    (Wis.).   1028. 

Proofs  of  death;   requirements    reasonable    (Wis.),    1022. 

Proofs  of  death;  denial   of  liability    (Wis.),   1022. 

Proofs  of  death    showing   suicide   receivable    in    evidence    (Wis.),    1022. 
PROPERTY: 

Rights  of  memljers  (Cal.).  40. 

Member's    interest    in.    belonging    to    society    terminates    when .  membership 
ceases   (Cal.),  46. 

Of   local    lodge    (Mich.),   487. 

Right  in   corporate  name   (Neb.),  642. 

Of  lodge  .subject  to  taxation   (Miss.),  553. 

What  becomes  of,  when  charter  is  forfeited  (S.  C),  860. 

See  Vested  Interests. 
PUBLIC: 

Policy   as   to   beneficiaries    (Mich.).  485. 

Charged  with   notice  of  limited  powers  of  societies    (111.),   169. 
RATIFICATION: 

Of   agent's   acts    (111.).    170. 

Cannot   be  made   of  ultra   vires  contract    (111.),   169170. 

See   Waivers   and  Agency. 
READJUSTMENT: 

Increasing  members'  rates  by   (111.),  193. 

And    increase    of    rates    (Kas.).    325. 

Right   to  raise  and  readjust  rates    (Mass.),  442-443. 

After-enacted    laws    and    (Mass.),    441-442. 

Increasing    rates    by    after-enacted    laws    (Mich.),    469. 

And  increase  of  rates    (Mich.),  469. 

Rates  subject  to  change   (Mo.),  578. 

Failure  to  pay   increased  rates    (Mo.).  579. 

Increasing  of  rates   by   after-enacted  laws  valid    (Tenn.),  901. 

Valid    (Tenn.),    901. 

Increase  of  rates:     Meaning  of  term    (Va.),  976. 
Increase   of   rates   a.s   required    (Va.),   976. 
See  After-Enacted  Laws. 
REASONABLE: 

After-enacted   laws    (Conn.).  70. 

After-enacted   occupation   laws  valid    (111.).   189. 

After-enacted  laws,  what  are   (111.).  194. 


INDEX  1125 

REASON  ABLE— Continued : 

After-eniicted   suicide   laws   inc    (111).   I(i4. 

What  by-laws  are  not    (Ind.),  2.'JJ. 

By-laws    respecting   suspension    (Md.),   410. 

Laws;   wlicn   iinicasonnMc  as  to  iiioinlicis'  lifflit   to  resort  to  courts   (.Minn.), 
519. 

After-enacted   laws   must   be    (Minn.),  .");J1. 

When   afteroiiacted   laws  are   not    (Minn.).  .■)17. 

See  By-laws  and  After-Enacted  Laws. 
RECEIVERS: 

Liability    of    (Mich.),    4S(i. 

May   enforce  collection  of  assessments    (Micli.l,  4lil. 

Will   not   be   appointed    for   foreign   society    wliiili    lias    no    property   within 
the  State   (>i.  C),  752. 

For  insolvent  society    (I'a.).  837. 

Ki'ceix  ersliip:    no  assessments   for  subseipient   losses    (li.'L),  857. 
REDUCTION: 

Of  benefit  by  after-enacted  laws   (Mass.),  447,  44!). 

(Jf  benefits  by  after-enacted  laws    (X.  J.),  ()02. 

Of  benefits  by  after-enacted  laws    void    (\.   Y.).   724. 

Of  benefits  by  after-enacted  laws    (Tenn.),  908. 

Of  benefit   due    under   contract   void    (Texas),   939.  * 

Of  wrtiticate    M.i.l    (Texasi.  941. 

See  After-Enacted  Laws,  Repudiation. 
REINCORPORATION: 

Ki,^lit   of    (X.   v.).   729. 
REINSTATEMENT: 

Burden   of   proof   as    to    (.Vrk.).    19. 

Stipulation   as   to  f;ood   liealtli    i.VrU.).   21). 

Of   forfeited  certificate    (Cal.).   32. 

In  forfeited  cases   (t'olo.).  (iO. 

A    personal    privilege    (I).    ('.).    98. 

Cannot  take  place  after   member's  death    (1).   (.1,  100-101. 

A   personal   privilege    ((ia.),    115. 

Where  local  officers  are  agents   of  society    (HI.),   107. 

Health  certificate  required   (Iowa),  278. 

Ke(|iiirements    of    (Mass.),   446. 

Subject   to  old  conditions  of  contract    (Me.).  3SG. 

After   forfeiture    (Minn.),  528. 

Conditions   precedent  to    (Miss.),  554. 

Requisites  of   (Mo.),  588. 

Waiver   of   recpiirements    (Xeb.).   035. 

May  be  secured  only   in  strict   conformity   to  laws   (X.  C),  754. 

Acts  of  officers  in  connection  with,  not   ministerial   (X.  C),  75.3. 

Court  cannot  issue  mandate  to  elfect   (X.  Y.),  719. 

Optional  with  society   (Pa.),  841. 

When  right  to.  exists   (S.  C).  805. 

Apidieation   for.  and   warranty   un<ler    (Tenn.).   907. 


1126  FRATERNAL    SOCIETY    LAW 

REINSTATEMENT— Continued: 

Representations  in  application  for   (Texas).   033. 

Is  a  contract  right   (Texas).  928. 

See   Forfeiture,   Suspension,   Trials. 
RELATIVE: 

Stepson  after  death  of  mother  held  not  to  be   (Ala.),  8-9. 

\\\\i>  are  relatives    (Texas),  929. 
RELEASE: 

Suit   to   cancel,   must   tender   back  payment    received    (Iiid.).   251. 

Of  claim;  suit  to  set  aside  (Ind.),  251. 

Of  statute  of  limitations   (Cal.),  37-38. 

Accord  and  satisfaction    (111.),   103. 

On  part  payment    \aliil   only   in   coniproniise  cases    (111.).   1G3. 

See  Compromise. 
RELIEF: 

FruMi    ilh-al    t.ixc-    (111.),    182. 
REMEDIES,   EXHAUSTING: 

.See  Courts. 
REMEDY: 

Where  society  repudiates  contract    (Ga.),   111. 

See  Damages,  Repudiation. 
REPRESENTATIONS : 

And  warranties    (Coio. I,  til. 

Versus  warranties   (La.),  307. 

Materiality  of   (Me.),  387. 

Materiality  of   (X.  C),  752. 

Materiality  of,   in  application;    act  respecting  not   retroactive    (R.   I.),  855. 

In    a])|)!ication    for    reinstatement    (Texas),    933. 

See   Materiality  ami  Warranty. 
REPRESENTATIVE: 

Government;    after-enacted   laws    (Neb.),  649. 

Form  of  government,   what   is    (Xeb.).   641. 

Form   of   government    required    (Xeb.).   642. 

Sei'  Societies. 
REPUDIATION: 

Of  contract  bj'  society  (Ga.).  111. 

Of  contract;  remedy  (X.  C),  747. 

Right   of   action   accrues  upon    (N.  J.),   692. 

Of  contract  gives  right  to  suit   (Texas).  939. 

Of  contract  gives  right  to     sue   (Va.),  974. 

Of  contract;   remedies  under  (Va.),  976. 

See  Reduction,  After-Enacted  Laws. 
RESCISSION: 

Of   coiifracts;    wlien  not   alh>xved    (Ind.),  247. 
RESERVE  FUND: 

Use  of  (Cal.),  46. 

To  be  applied  to  members'  payments  before  forfeiture    (la.),  276-277. 

In  hands  of  society,  duty  to  use  to  prevent  forfeiture   (Kas.),  318. 


II 


INDEX  1127 

RESERVE  FUND— Continued: 

After-eiuieti'd    laws 'respecting    (Jlass.j,    441-442. 

Not  taxable  (Neb.),  G50. 

See  Funds,  Taxation,  Benefits. 
RESORT  TO  COURTS: 

See  Couits. 
RETROACTIVE: 

Statute  relating  to   beneficiaries   is   not    (Del.).  83-84. 

Laws  must  clearly  so  provide   (Ga.),  114. 

What  State  laws  are  not   (111.),  160. 

When  iifler-enaclcd  laws  nrc   (III.),  189. 

See  After-Enacted  Laws. 
RHODE  ISLAND: 

Fiateriial  societies  are  e.\enipt  triini   State  supervision,  850. 

Power  of  attorney;   service  of  process,  850. 
RISK: 

Increase  of;  warranty   (ArU.),  27. 

Excepted;   suicide  sane  or  insane    (111.),   167. 

Risks    assumed    by    consolidation    of    societies    (Iowa),   291. 

Death  from  excepted  cause   (Ind.),  227. 

Of   suicide   not   assumed    (Mass.).   441. 
RITUAL: 

Rijiht   to   use:   suit  of  one  society  against  another   (Mich.),  487. 
SALOONKEEPER: 

Meaning  of,  defined  (Ala.),  12-13. 

By-laws    prohibiting   members'   going   into    saloon    business    are    reasonable 
(111.),   189. 

After-enacted   saloon   laws  are   valid    (111.),   189. 

ProMibited  occupation   (Minn.),  525. 

After-enacted   laws   respecting    (N.   J.),   690. 

And  bartender,  who  are    (Wis.),  1028. 
SEAL: 

Society   nuiy   adopt;    presumptions   with   regard   to   same    (Vt.),   960. 

service! 

See  Summons. 
SICK  BENEFITS: 

After-enacted    laws    (Cal.).   43-44. 
Suit  for,  before  exhausting  remedies   (Ga.),   109. 
Evidence    (Hawaii),  128. 
Total   disability    (Ind.).   240. 

Restrictions   on   members'    conduct    (.\lich.),   490. 
Total  disability   (Mich.),  477. 
Right  to,  survives    (Utah),  947. 
See  Benefits. 
SISTER-IN-LAW: 

May  bo  beneficiary,  wlien   (Cal.),  35. 
ilay  be  l)enefieiary  (N.  Y.),  715. 


1128  FRATERNAL    SOCIETY    LAW 

SITUS: 

Of  contract  and  suit   (Aiiz.).  2i). 
When  contract  is  Illinois  contract    (111. I.   187. 
Of  suits:  conflict  of  jurisdictions  (Kas.).  310. 

Of  contract  issued  in   Xew  York  but  sued  on  in   Maryland    (Md.),  413. 
Of  contract,  nilc   as  to   (\V.  Va.l.  1002. 
See  Contracts,   Courts,  Jurisdiction. 
SOCIETIES: 

Failure    to  pay   losses  proni]itly    (Ark.).  20. 

Fraternal  and  mutual,  distinction  between   (Ark.).  2.5. 

Use   of   reserve   fund    (Cal.).   40. 

By-laws,   rules   and   regulations   part   of   contract    (Cal.),   47. 

Unincorporated,   expulsion  from    (Cal.).  4.5. 

Policy  of.  will  not  be  interfered  with  by  courts   (Cal.),  47. 

Have  right  of  interpleader   (Cal.).  42. 

Principles  on  which  they  are  based  (Cal.).  30. 

Fraternal,    not    charities    (Ca!.).   37. 

Liable  for  damages  caused  by  negligence  of  surgeon   (Cal.  I.  37. 

Exempt  from  insurance  laws  (Cal.),  43.  '   . 

May  hold  supreme  lodge  meetings  out  of  State  wliere  chartered   (Colo.),  54. 

Are   mutual   societies    (Colo.).  5S. 

Powers   of,   to   compromise    suits    (Conn.),   72. 

Bound  by  acts  of  chief  officials   (111.),  182. 

Society,  as  to  funds,  a  mere  trustee    (111.),  170. 

Limited  as   to   right    to  collect   funds    (111.),   177. 

Bound  by  knowledge  of  subordinate  lodges  (111.),  ISO. 

Fraternal,   not    ]nil)]ic    charities    (111.),    104-10.5. 

Fraternal,   not    Imimd   by    promoters'   contract    (111.).   102. 

Unauthorized   acts   of.   do  not   affect    members'   obligations    (111.),   170, 

Fraternal   beneficiary  act   of   1803.  construction  of    (111.),   105-100. 

Consolidation  of;  risks   assumed    (Iowa).  201. 

Are  to  be  deemed  insurance  companies   (Iowa).  208. 

Rights   of   old   members   in   consolidation   of    (lowal.   292. 

Not  to  employ  paid  agents;  ultra  vires  contracts  (lowal.  270. 

Exempt   from    insurance    laws    (lowal.    2S4. 

Exempt  from  general  insurance  laws   (lowal.  277-278. 

Fraternal,  discussed  and  construed   (Ind.),  2.51. 

Powers   of    (Kas.),   312. 

Have  only  snch  powers  as  are  expressly  conferred  im   them  in  their  charters 

(Kas.).   318. 
Cannot   pass   laws   abridging  statute   of   limitations    iKy.),  331, 
Are  bound  to   their  members   to  perpetuate   tlicnisclv<s    (Mass.).  443. 
Exempt    from    insurance    statutes     (Mass.),    440. 
Not  charitable  institutions,  charity  defined  (Me.),  38S-.380. 
Fraternal,   when   not   permitted   to  com|)ete    (Micli.l,   481. 
Exempt   from   general   insurance   laws   (Midi.).  474. 
Fraternal;    tribunals   not    bound   by    teclinicalities    (.Mich. I,   483, 
Fraternal;   acquiescence  by  member  in   ruling   (Jlich.).  483. 


l^DEX  1129 

SOCIETIES— Continued: 

Frateniiil.   iicil    a    ]mrtneislii|)   in   any   sense    iMidij,  V.r.i. 

Fraternal,  eanmit   issue  enjownieiit  cDntraets   (Minn.).  Slii. 

Fraternal,  cannol    [jay   dividends   or   endowments    (Minn.),   514-515. 

May  be  ehartered  in  two  States   (Mo.),  (iOO. 

Fraternal,  delinition  of.  in  ilissouri   (Mo.),  598. 

Foreign  and   doniestie   treated  alike    (Mo.),  5!)4. 

Making  eertitioates   i)ayable   to   "legal   representatives"   not   Iraternal    (Mo.), 
582. 

Fratern&l   and  assessment,  exempt  from  general  insurance  laws    (Mo.),  581. 

Fraternal,  exempt  from  general  insurance  laws  (Mo.),  ,>80. 

Fraternal,  defined   (Mo.),  577. 

Fraternal,  limited  in  power  by  statute    (.Mo.).  (i05. 

Foreign;   when  not  autliorized  to  do  business  in  State   (Mo.),  002. 

Fraternal,  liow  ditl'ering  from  old  line   (ilo.),  002. 

Fraternal,  not  restricted  to  assessment  business   (Mo.),  002. 

Insurance  department's  discretion    (Neb.),  042. 

Names  of,  must  not   mislead  the  public   (Neb.),  042. 

Property  rights   of.  in  corporate  name    (Neb.),  042. 

Must  have  representative  form  of  government   (\eb.),  (i41,  042. 

Duty  of  State  otiicials  in  case  of  noncompliance  with  State  laws  (Neb.),  041. 

Fraternal,  are  mutual  insurance  societies  (Neb.),  03S. 

Exempt  from   general   insurance  laws   (N.  H. ),  075. 

Change  of   purposes    (N.   J.),  08!>. 

Objects  cannot  be  changed  without  vote  of  members   (N.  .J.),  089. 

Not  subject  to  insurance  laws    (Ohio),  792. 

Have  power  of  expulsion   (R.  I.),  854. 

Rules  of  law   applicable  to    (S.  C),  80.5. 

Change   of  name,   ettect   of    (S.   C),   80.3. 

Exempt  from  general  insurance  laws  (S.  D.),  881. 

Exempt  from  general  insurance  laws   (Texas),  944. 

May    incorporate    in   several    States;    when    consolidation    unlawfid    (Texas), 
941. 

Fraternal,   what  are   (Texas).  927. 

Fraternal:   exemption  statutes  constitutional    (Texas).  920. 

May  hold  corporate  meetings  outside  of  State  of  charter  (Texas),  92.5. 

Exempt  from  general   insurance  laws    (Texas),  922. 

May  adopt  seals;  presumptions  respecting  same  (Vt.),  900. 

Laws  classifying  societies  aie   constitutional    (Wasli.).  994. 

Fraternal   beneficiary    society   defined    (Wis. I.   1020. 
SOUTH  CAROLINA: 

South    Carolina    has    no    fraternal    insnraiu-e    code.    8.50. 
SOUTH  DAKOTA: 

South  Dakota  has  no  s])ecial  code  for   fraternal  societies,  807. 

Sections  of  general  insurance  laws  applicable  to  fraternal  societies.  ,807-879. 

Articles   of  association   must   show    plan   of   business   807. 

Confusion  in  names.  807. 

Contract  nuist  show  limitation  of  amount   to  be  paid.  808. 


1130  FRATERNAL,    SOCIETY    LAW 

SOUTH  DAKOTA— Continued: 

Bonding  oificers  of  societies,  868,  869. 

Minimum  number  of  applications  necessary  before  doing  business,  878. 

Autliority   to  transact   business,  868. 

By-laws   must  show  object  of   assessments,   868-869. 

Age  limitations,  869. 

Annual  report,  869,  873. 

Additional    reports,    870. 

Investment  of  funds,  870. 

Deposit  of  securities  with  Superintendent   of  Insurance,  870-871. 

Admission  of  foreign  societies,  871-873. 

Insolvency    of    foreign    societies;    maladministration;    revocation    of    license, 

872-87.3. 
Power  of  attorney;  service  of  process,  871-872. 
Examination  of  books  and  accounts,  872. 

Violation  of  statute;    doing  business   unlawfully;    penalty,   873. 
Doing  business  without  authority;  penalty,  873-87-1. 

Certificate  of  authority  issued  in  the  name  of  each  subordinate  lodge,  874. 
Failure  to  make  annual  report;  maladministration;  appointment  of  receiver, 

874-875. 
Certificate   of   authority   from   insurance   commissioner,   87.3. 
Definition  of  mutual  benefit  associations,  875. 
What  societies  not  permitted  to  do  business  in  this  State,  875. 
Payment  of  taxes;   societies  exempt,  876. 
Policies  of  insurance,  to  whom  payable,  876. 
Exemption  from   attachment  for  debt,  876-877. 
Intemperate  habits,   if  generally   known,   no  defense  to  liability   on  policy, 

877. 
Medical    examination    by    company's    pliysician    conclusive    as    to    health    of 

insured,  877. 
Fraud  or  irregulai'ities  in  ai)i>lioatinn  no  defense  after  three  anmuil  premiums 

have  been  paid;  exception,  877-878. 
Misstatement  of  age  in  application,  878. 
Eetaliatory  clause,  as  between   States,  878. 
Payment  of   taxes,  878-879. 

False  or  fraudulent   statements  in  securing-  insurance;   penalties,  870. 
Duties  of  fidelity  and  surety  companies,  S7!l. 
Fraternal    beneficiary    societies    must   comply    with    the    provisions    of    this 

statute,   879. 
STATE  LAWS: 

What  State   laws   are   part  of   contract    (111.).   161. 

Societies  may   obtain  certain  benefits  fronl,   without   increasing   obligations 

on  existing  contracts  (111.).  161. 
Not  retroactive  (111.),  160. 
After-enacted,  effect  of  iKy.),  3.?7. 
Amendment  of;   change  of  beneficiary    (ilich.),  478. 
Effect  of  amendment   of    (ilich.),  478. 
Control   certain   societies    (Miss.),  .551. 


J 


INDEX  J  2;^  J 

STATUTE  OF  LIMITATIONS: 

Sec  Limitations. 
STEPFATHER: 

As   beiioficiiuy    (Jlii'h.),  475. 
STEPSON: 

Not  entitled   to  tiike   liciiclit    (Ala.).   8-!l. 
. SUBORDINATE  LODGE: 

Kll'ei-'t   lit'  siispcnsiuTL  nl.  mi  niciiihcis'  c-crt ilii-ates   (Ark.).  22. 

Jurisdiction   of   courts   as   between   members   and    (Cal.).   47. 

Trials  of,  reviewed  by  courts  (Cal.),  4G. 

Expulsion  of,   by   unincorporated  society    (Cal.),  45. 

Dispute  between  member  and;  jurisdiction  of  courts   (Cal.),  44. 

When  not  agent  of  grand  lodge    (Cal.),  43. 

Expulsion  of  menilx'r  from    (Cal.),  .lO. 

When  ollicers   of.  are  agents   of  supremo   lodge    (Colo.),  58. 

Agency  of  local  ollicials   (D.  C),  !)!). 

Agency   of  local  oHicer    (Ida.),   130. 

Laws    part    of    contract     (111.),    1!)1. 

Agency  of  ollicers  of  (III.),  lU7-l(i8. 

Is  agent  of  supreme  lodge  (111.),  I8G. 

May  waive  forfeitures   (111.),  197. 

Agency  by,  of  society    (111.),  107. 

Abandonment  of  lodge   system    (Ind.),   254. 

Rights  of  minority  of.  when   majority   secede    (Ind. I.  244. 

Agency  of  local  officers    (Ind.),  241. 

Service  of  summons  on  local   officers    (Ind.),  229. 

Waiving  laws   by    (Kas.),   328. 

Unincorporated,  not  a  partnership    (Kas.).  324. 

Agency  of  (Mich.),  492. 

Agency  of   (Mich.),  488. 

Secession  of   (Mich.),  479. 

Funds  of,  not  property  of  society  (ilich.),  487. 

Dispo.sition  of  property  of   (IMich.),  479. 

Laws  of  (Mich.),  478. 

Waivers  by    (ilinn.),  520. 

Agency  of  local  officials   (Veb.).  037. 

Officers  of,  cannot  waive  laws   (Xeb. ).  ()3(i. 

Secession  by  local  lodge   (N.  J.),  690. 

Right  of,  to  secede  from  society   (N.  J.),  090. 

Dissolution   and  reorganization  of.  permissible    (Texas).  940. 
SUBSEQUENTLY   ENACTED    LAWS: 

See  After-Enacted  Laws. 
SUICIDE: 

After-enacted  by-law  valid  (Ala.).  7-8. 

Incontestability   clause    changed    by    after-enacted    by-law    (Ala.),    R. 

Death   by  member's  own  hand  means   (Ala.),  10. 

After-enacted  by-laws  valid   (Ala.),   10-11. 

Burden  of  proof    (Ark.).   19. 


1132  FRATERNAL    SOCIETY   LAW 

SUICIDE— Continued : 

Coroner's   verdict   not   prima  facie  evidence  of    (Ark.).   19. 

Presumption   always  against,  until   contrary  shown    (Ark.),    19. 

Facts  held  not  sutKcient    (D.  C).  99. 

Sane  or  insane   (Ga.),  110. 

Sane  or  insane,  after-enacted   laws    (Ga.).   112.  . 

Sane  or  insane,  an  excepted  risk   (111.),  167. 

"Commit  suicide,"  application  of   term    (111.).   172. 

"Insane  impulse,"  definition   of    (111.).    172. 

Opinions  of  physicians  as  to    (111.1.   17.">. 

Burden   of   proof  always  on   society    (111.).    17(1-177. 

Presumptions  against    (111.),   17S. 

"Sane   or   insane"   clause   valid;    insanity   no   defense    (111.).    179-180. 

Xot  a   criminal  act   (111.),   ISO. 

In  absence  of  proof,  sanity   prcsiuiied    (111.),   181. 

Provision   valid    (111.),   182. 

Sane   or    insane   provisions    valid    ilU.l.    184-18.5. 

By   strangulation    proved    from    circumstances    (111.),    l.iS-l.^O. 

When  insanity  no  defense    (111.),  15!). 

Is  no  defense  unless  provided  for  in  contract   (111.).   102. 

After-enacted  Ijy-laws   valid    (111.1,    l{i;MU4. 

After-enacted   laws   reasonable    (111.),   104. 

Coroner's  verdict  showing  (Iowa),  291. 

Death  from  overdose  of  poison    (Iowa).  294. 

Under  incontestable  clause   (Ind.),  25.i. 

Cannot   be    proven   by   coroner's    inquest    (Ind.),   250. 

Self-inflicted  injuries   (Ind.),  245. 

Presumptions  in   favor  of    (Ind.),  241. 

Death   from   intemperance    (Ind.),  240. 

Presumptu)ns;   facts  for  the  jury    (Ind.).  232. 

Incontestable  clause   (Kas.),  317. 

Sane  or  insane   (Kas.).  323. 

Provided  against   by   implication    (Ky.),   333. 

Is  against  public  policy  (Ky.),  333. 

While   insane    (Ky.),  333, 

Circumstantial   evidence   of    (Ky.),   334. 

Coroner's    inquest    as   to    (Ky.),    334. 

Where  certificate  contained  no  stipulation  against   (K.V.),  3.34-335. 

Definition  of,  under  sane  or  insane  clause  (Ky.),'335. 

Sane  or  insane;  erroneous  instruction  (Ky.),  335. 

After-enacted  laws  applicable  to  outstanding  contracts    (La.),  300-307 

After-enacted  laws   (La,),  3C)5-30t>. 

Risks  not  assumed   (La.),  3G4, 

Use  of  opiates;  presumptions   (La.),  304. 

Accidental    death    presumed    (La.),   304. 

Circumstantial   evidence   to   prove    (La.).   302. 

Death  by  own  act   (La.).  302. 

Risk    not    assumed    (Mass.),   441. 


INDEX 


1133 


SUICIDE— Continued : 

Accidental   poisoning    (Midi.),  480. 

While  insane   (Mich.),  477. 

Death    i-esultiiig   from    habits    (Mc).    .'f.SS. 

Pifsuinptions    against    (Md.),  4Ui. 

Deliberate,   by   drugs    (.Minn.),  ."il.'j. 

Sane   or   insane    (ilinn.),    .')2:). 

While  insane    (.Minn.),  oil). 

I  iireasonable  after-enacted   laws    (.Minn.).   .'ilS. 

Circumstantial   evidence    (ilinn.),  .")17. 

Presumptions   (Minn.),  517. 

Burden  of  proof   (Minn.),  .527. 

After-enacted   law    respecting,   valid    (Miss.),   557. 

When  after-enacted  laws  invalid   (Mo.),  5n5-50(!. 

After-enacted  law  hehl  invalid  as  to  contracts  in  force    (Mo.).  587. 

When    after-enacted    hiw    not    binding    (Mo.),   580. 

Provisions   valid    (Mo.).  585. 

Suicide   provisions   valid   in   case  of   society   not    authorized   to   do   business 

in  State   (Mo.),  585. 
Provision    in    contract    valid    (.Mo.).    577. 
When   duty  of   court   to   direct   verdict    (ilo.),   (>0!». 
No   intent  to  conimit.  when  applying  for  certiticatc    (Xcb. ).  (i50. 
After-enacted  laws    (Xeb.),  t!45. 
Duty   of  court   to   instruct    (Neb.),  040. 
Approximate    cause    of    deatli     (Xeb.).    040. 
Facts   in   case    (Xeb.),   040. 

Sane    or    insane   provision    valid    (X.    ('. ).    754. 
Wlien   directed   verdict   proper    (X.    D.I.   772. 
Self-destruction  defined    (X.   D. ).  772. 

Evidence  as  to;  note  in  member's  handwriting  (X'.  D.).  772. 
Insufficient   evi(leiice    (N.   J.).   0!t7. 
After-enacted   law    (X.   J.I,  091. 
After-enacted  law  not  ralid   (X.  V.),  725.  7 IS. 
After-enacted  law   (Ohio),  791. 
By-law   governing,  reasonable    (Ohio),   791. 
Presumptions  against   (Ore.),  820. 
Proofs  of  death  ])rinia  facie  evidence  of   (Pa.l.  .'!47. 
Facts  sutncient   to  establish    (Pa.),  848. 
After-enacted    laws    valid    (Pa.),   842. 
Sane  or  insane  clause  valid  (Pa.),  842. 
Sane  or  insane  clause  valid  (Pa.),  8.'!4.  837. 
Sane  or  insane  clause  valid    (S.   C),   862. 

Verdict  of  coroner's  jury  not  admissible  in  evidence   iS.  D.).  881. 
What   facts   not   conclusive   of    (S.   D.),  880. 
Reckless  use  of  drugs  (Tenn.),  910. 

Coroner's    verdict    not    admissible   in    evidence    (Texa-I.   940. 
■  Suicide   law  valid    (Texas).   9;i8. 
Ivule  as   to:   burden   of  ])roof    (Texas).  92.3. 


1134  FRATERNAL    SOCIETY   LAW 

SUICIDE — Continued : 

After-enacted   laws  valid    (Va.),  977. 

No   presumption    (Va.),    977. 

By  insane  member;   rule  as  to    (Wash.),  994. 

Presumptions  respecting   (Wis.),  1029. 

Statements  in  proofs  of  death  are  prima  facie  (\\'is.).  1028. 

Admissions  of   beneficiary   as   to    (Wis.),   102.^. 

Effect  of  statements  as  to,  in  proofs  of  death    (Wis.),   1022. 

Is  not  death  in  violation  of  law   (Wis.),  1019. 

After-enacted   laws   valid    (Wis.).   1018. 
SUIT: 

On  bond  to  state  liability  under   (Ark.).  20. 

Situs  of,  on  contract    (Ariz.),  29. 

By  wrong  name    (Colo.),  59. 

Validity  of  statute  of  limitations   (Conn.),  73. 

Against  Insurance   Superintendent   by   mandamus    (111.).   191. 

Against  members  for  assessmeuts    (111.),   196. 

Provisions  for  requiring  suit  to  be  begun  in  limited  time,  valid   (111.),  160. 

By  minor  after  attaining  majority  where  guardian  settled  claim   (111.),  174. 

Ximit  as  to  time  for  bringing   (Iowa),  281. 

For   benefits,   when   premature    (Iowa),   278. 

By  members  to  prevent  payment  of  invalid  claims    (Ind.),  231. 

By  members  to  prevent  issuance  of  special  contracts  (Ind.),  230. 

To  set  aside  release   (Ind.),  251. 

Venue   of,   against   societies    (Kas.),    329. 

Time  for  filing  suits  (Kas.),  321. 

Time  limit  for   (Kas.),  324. 

Limitations  as  to  time   to  bring    (Ky.),  331. 

Time  when  same  to  be  brought   (Mich.),  470. 

When  prima  facie  case  is  made  for  plaintiff  (N.  C),  746. 

Who  is   real   party   in   interest    (N.  M.),   659. 

Consolidation  of  suits  on  one  certificate   (Tenn.),  909. 

By  administrator  on  certificate,  when  proper   (Vt.),  960. 

See  Venue,  Courts,  Jurisdiction. 
SUMMONS: 

Service  of,  on  insurance  superintendent  not  exclusive  method   (111.),  159. 

Service  of,  in  Municipal  Court  of  Chicago  (111.),  160. 

Service  of;   limited  powers  of  Municipal  Court  of  Chicago   (111.),  160. 

Service  of,  upon  local  officials  (Ind.),  229. 

Service  of,  upon  insurance  commissioner  (Kas.),  321. 

Service  of,  on   foreign  society    (Mass.),  445. 

How  effected  (Mich.),  475. 

Service  of,  how  made  (Mich.),  475. 

Service  of    (Minn.),   525. 

Service  upon  insurance  commissioner  (N.  C),  749,  756. 

Service  of,  upon  local  agent   (Ore.),  817. 

t-ervice  of,  on  local  officer  good   (Texas).  940. 

Service  on   foreign   society    (Wash.).   995. 


I 


INDEX  1135 

SUPERINTENDENT  OF  INSURANCE: 

See  Insurance  Superintendent. 
SUPREME  LODGE: 

I'lace  of  meeting   (t'olo.),  04. 

Agency   of,  by  siibonlinate  lodge    (111.),   18U. 

Powers   of    (Jll.),   l'.)2. 

Meetings  held  in  foreign  State  (111.),  192. 

Cannot  delegate  legislative  power   (111. I.  103. 

Relation.?   with   siiljordinale  lodges    (ilo.),  U07. 

Power  to  legislate  cannot  be  delegated  (Miss.).  5.55. 
SURPLUS  FUNDS: 

Pdglits  of  members   in    (111,).   177. 

Dut_y  of  society   to  apiily.   tu   prcvciit   forfeiture   illl.l.   ISl. 

See  Funds. 
SURVIVORS: 

Sur\i\ing    children,    who    arc    within    the    term     (Ala. J,    !)-10. 

Surviving  children  as  beneficiaries    (Ark.),  20. 

No  presumption  of   siirvivor.ship   in  deaths   in   common   disaster    (111.),   185. 

Surviving  widow  as  beneficiary   (Ky.),  337. 

Rule  as   to   survivorship   in   deaths   in   common   disaster    (Texas),  934,   935. 

Survivors,  who  are   within   the  term   (Wis.),  1020. 

See  Beneficiaries. 
SUSPENSION: 

Of   lodge,   efleet   of,   on    members'    certificates    (Arlj.),   22. 

Of  member  (Ga. ),  115. 

Reinstatement  personal   (Ga.),  115. 

And  forfeiture   (111.),  186,  192. 

Rule  as  to   waiver  by  custom    (Mo.),  595. 

Acquiescence   of   member   in    (Mo.),   591. 

Wrongful;    subsequent    performance   of  duties   as   member    (Mo.),  591. 

Waiver  of  rules  as  to,  by  member   (Mo.),  609. 

Course  of  dealing  affects    (Mo.),  601. 

Rule  as  to  notice  to  member  of  charges   (Mo.),  600. 

Receipt  of  money  docs  not  waive  other  conditions  for  reinstatement  (Xeb.), 
637. 

Jlember  under,  not  entitled  to  benefits   (X.  H.),  674. 

Court  has  no  power  to  issue  mandatory  injunction  to  reinstate  (X.  Y.).  719. 

Payment  of  arrearages  and  death  of  member  while  under   (Ore.),  818. 

Failure   to   exhaust   society's   remedies   estoppel   from    action   in  civil   coiut 
(Ore.),   820. 

Reinstatement  a  contract  right  (Texas),  928. 

Members   of  suspended  lodges  not  entitled   to   benefits    (Texas),  927. 

Tenders   not   required   of   members   unlawfully   suspended    (Wis.).    1022. 

See  Forfeiture. 
TAXATION: 

Property   of   fraternal   societies  subject    to    (III.),   164. 

Statutes    exempting    fraternal    societies    from,    unconstitutional    (HI.),    165. 


1136  FRATERNAL    SOCIETY    LAW 

TAXATION— Continued: 

Funds   of   fraternal   societies   subject   to    (111.).    185. 

Funds    in    bank    subject    to    (111.),    185. 

Benefit  certificates  are  subject  to   (111.).  175. 

Illegal  levy  of  tax  no  ground  for  relief  after   payment    illl.),   182. 

Property    exempt   from    (Kas. ).    320. 

Funds  invested  for  an  income,  subject  to  (Kas.).  320. 

A  charity  defined    (Me.),  388. 

Lodge   pioperty    .subject   to;    charity    (Miss.).   553. 

Of  funds  of  fraternal  societies   (Xeb. ).  G.50-653. 

Club  house  of  lodge  not  exem|it    (Wis.).  1027. 
TENDERS: 

Need  not  ue  repeated   (Colo.),  58. 

Need  not  be  repeated  (<ia.),  117. 

Of  payments  must  be  made  before  cancellation  can  be  had  (Ind.).  251. 

Need  not  be  repeated  when  refused  (Mich.),  488. 

Required  of  payments   by   member   wrongfully   suspended    (Mo.).   591. 

Of  payments   made   due   upon   failure   of   contiact    (N.   D.).   769. 

Must   be   made    of   payment   received   before   compromise   can   be   set    aside 
(S.    C).    862. 

Of  assessments,  when   waived    (Tenn.).  911. 

Not   required    of   members    unlawfully    suspended    (Wis.  i.    1022. 
TENNESSEE: 

Statute  relating  to  fraternal  societies,  883-899. 

Definition  of  fraternal  beneficiary  association.  883. 

Definition   of   lodge   system.   883. 

Definition  of  representative  form  of  government.  883-884. 

Fraternal  societies  exempt  from   insurance  laws.  884. 

ilust  provide  for  the  payment  of  death  benefits.  884. 

Class  of  beneficiaries,  884. 

Age  limits  for  membership,  884. 

Medical  examination  and  approval  necessary  for  membership,  884-885. 

Certificate  must  specify  amount  of  benefit.  885. 

What  constitutes  the  contract  of  insurance,  885. 

After-enacted  liy-laws   binding  on   members  and  beneficiaries,  885. 

Societies  may  create  and  maintain  a  reserve  fund.  885. 

Benefit  and  expense  funds  to  be  derived  from  assessments.  885-886. 

Asses.sments  shall  not  be  made  oftener  than  once  a   month,  886. 

Power  to  levy  extra  assessments,  886. 

Investment  of  funds,  88(). 

Constitution  and  laws  to  make  provision  for  assessments,  886. 

Jlortuary  or  reserve  fund   iu)t  to  be  used  for  expenses.  886. 

Benefit  fund   not   liable   to  attachment   for  debt.  886-887. 

Property  of  fraternal  societies  exem])t   from  taxation,  887. 

Incorporation   of   fraternal   societies;    provisions,  887-889. 

Status  of  existing  domestic  societies,  889-890. 

Consolidation  of  societies;  transfer  of  nicnibership  or  funds.  890. 

Association  of  white  and  colored  races,  S90. 


INDEX  ,  137 

TENNESSEE— Continued: 
Aiiniml   liceiisp,  K!)0-S!)1. 
Kratrnial  Omgrcss  iiimtality   laljlr  of    IIIIX)  i»overn9;   eNceiJlion.  S!)l. 

Kffusal  or  levocation  of  liopiise.  H!)l-S!)2. 

Powers  of  attorney;    service   of   |)roeess,   8!l2-8i)H. 

Meetings  of  legislative  or  goveniiii;4  body.  Hi).'!. 

Officers   and  members   not  individually   liable   for  society's  oblij^ations,  8U3. 

Laws  may  make  provision  against  waiver  by  members  or  subordinate  bodies, 
8!)3. 

Grand  lodges  slmll   lie  treated  as  a   federation,  not  as  single  State  organiza- 
tions, 8!);j. 

Filing   with    Insurance   Commissioner   copies    of   amendments   to   constitution 
and  laws,  803. 

Annual  statement,  894. 

Examination  of  societies'  affairs,  894,  895. 

Violation   of   law;    maladministration;    injunction:    appointment    of   receiver, 
894-895. 

Action  to  enjoin  must  he  started  by   Attorney  (ieneral.  8ilo. 

Refusal  to  sulimit  to  examination;   revocation  of  license.  896. 

Revocation   of   license   of   foreign   societies;    mandamus.   S!)(l. 

Societies  not  subject  to  tliis  act,  89(i-8nT. 

Increase  in  assessments;   extended   insurance;   reduced  bimctit,  S!I7. 

Employment  of  paid  agents,  897. 

Misstatements  in  applications  as  to  age,  897-898. 

False  or  fraudulent  statements  in   securing  insurance;    penalties.  898. 

Doing  business  without  license;   ])enalty.  8!t8-SI)!l, 

Definition  of  terms.  899. 

Valuation  of  certificates  not  retpiired,  899. 

Act   to  take  etlect   from  and  after  its  passage,  899. 
TERMS: 

"Void"  and  "voidable,''  meaning  of   (Ala.),   11. 
TEXAS: 

Statute  relating  to  fraternal   societies,  913-922. 

Definition  of  fraternal  beneficiary  association.  913. 

JIust  have  lodge  system  and  representative  form  of  government.  913. 

Must  make  provision  for  payment  of  death  benefits,  913. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  913-!tl4. 

Class  of  Ijeneticiaries.  914.  ' 

Fraternal  societies  exempt  from  insurance  laws,  914. 

Existing  .societies  may  continue  to  do  business,  914. 

Admission  of  foreign  societies;  |)rovisions,  915, 

Power  of  attorney;  service  of  process,  915-91(). 

JIust  be  authorized  to  do  business  in  State  where  incorporated,  915. 

Examination   of  societies'   aft'airs,  915. 

Annual   statement,  91()-917. 

Additional  inquiries.  917. 

Refusal  to  make  report;    failure  to  pay  judgment:   penalty.  91S. 

Violation  of  law;   maladministration;    injuncticm.  918. 


1138  FRATERNAL    SOCIETY    LAW 

TEXAS— Continued : 

Fees  payable,  'Jl8,  'J22. 

Doing  business  without  autliority;  penalty,  919. 

Creation  and  use  of  ie»ei\p  fund,  919-920.  i 

Benefit  and  expense  funds  must  be  kept  separate,  920. 

Benefit  fund  not  subject  to  attachment  for  debt,  920. 

ileetings  of  legislative  or  governing  body.  920. 

Reciprocal  relations:   may  assess,  levy  and  collect  from  members,  921. 

Incorporation  of  fraternal   societies.   921-922. 

Certain  railway  orders  pxeiiii)t  from   tlie  provisions  of  this  act,  922. 
TRIALS: 

In  lodges,  review  of,  by  courts   (Cal.),  4U. 

By  lodge   (Cal.),  39. 

In  lodge,  review  of   (Iowa),  2S8.  , 

In  lodges  not  conclusive  (Jlich.),  480. 

In  lodges,  privileged  communications  in   (Mich.),  -t80. 

Tribunals  in  societies  lawful  (ilich.),  482. 

Members  charged  entitled  to  make  defense  (X.  .J.).  GST. 

By  lodge,  when  void,  and  effect  of  (X.  J.).  685. 

Of  insane imember  (Wash.).  993. 

See  Courts,  Expulsion,  Suspension. 
TRIBUNALS: 

In   societies,  jurisdiction  of   lild.).   417. 

Xot  bound  by  technicalities   lilich.),  483. 

Of  societies;  finality  of  judgments  of  (J.  J.),  688. 

Of  societies,  decisions  of.  binding  (Pa.),  838. 

See  Trials,  Courts. 
TRUST   FUNDS: 

ilortuary  funds  are  (X.  C),  756. 

Members'  payments  are   (Pa.),  839. 

See  Funds  and   Benefits. 
TRUSTEES: 

As  beneficiaries    (Ala.).  9-10. 

Societies  are.  as  to  funds  (111.),  170. 

Not  authorized  to  amend  charter  (Iowa).  281. 

May  be  made  beneficiaries  (Mich.).  490. 

For  beneficiaries  (Mich.).  490. 

Payments  to  (X".  Y.)  725. 

For  beneficiaries    (Pa.),  S40. 
ULTRA  VIRES: 

Contract  to  repay  amount  paid  in  b}"  member  less  benefits  ])aid  is   (Ala.),  7. 

Contracts;   after-enacted  laws   (Cal.),  48. 

Contract;  neither  party  estopped  to  assert  (111.)  169. 

Contract,  no  estoppel  under   (111.),  169. 

Contract  cannot  be  ratified  (111.),  169-170. 

Defense  of,  not  available  where  performed  contract  is  witliin  cluuter  powers 
(111.),  171. 

Contracts;  consolidation   (Iowa),  292. 


INDEX  1 1 39 

ULTRA  VIRES— Continued: 

Contract,  etl'ect  ul    finwa).  270. 

Contracts   (Kas. ).  .(Is. 

Agreements;  estoppel   (Kas.),  a  IS). 

Contract;   cash   benefits    (.Mich.).   408. 

Contracts,  payments  mach'  on   (ilich.),  480. 

Act  respecting  naming  of  Ijenefioiary    (N.  Y.).  720. 

Laws  reducing  benefits  (Tenn.).  008. 
UTAH: 

Utali  lias  no  t'rali  inal  licneficiary  code,  047. 

Section  41S.  diajitcr  .">.  general  insurance  laws.  047. 

Societies  and  orjianizations  e.\empf   from  provisions  of  Chapter  5.  047. 
VENUE: 

For  suits  against   societies    (Iowa).  2(iS. 

Of  suits  against  fraternal  societies  (Kas.),  320. 

Of  suit  against  society  (Ore.),  818. 

Where  suit  may  be  brougnt  (S.  C),  804. 

Of  suit  against  foreign  society   (Texas),  928. 

Of  suits  against  corporations  (Va.),  078. 

Sec  Suits  and  Summons. 
VERMONT: 

Statutes  relating  to  fraternal  societies,  952-0u7. 

Definiiion  of  fraternal  beneficiary  association,  952. 

Old  ago  benefits  to  be  governed  by  expectation  of  life  according  to  American 
Kxprrienee  Table,  052. 

Binidi   and  expense  funds  to  be  derived  from  assessments,  952. 

Class  of   beneficiaries,  952. 

Existing  societies  may  continue  business;   provisions,  952-953. 

Admission  of  foreign  societies;  provisions,  953. 

Power  of  attorney;  service  of  process,  953;  950-957. 

Permit  to  do  business,  953. 

Annual  report.  953. 

Employment  of  paid  agents,  953-054. 

Doing  business  without  license;  penalty,  954.  055. 

False  or  fraudulent  statements  in  securing  insurani'c;   penalties.  054. 

Refusal  to  make  report  or  fiu'nish  information;  penalty,  954. 

Violation  of  law; 'maladministration;  injunction;   reinstatement.  954-955. 

Fees  payable  to  insurance  commissioner,  055. 

Societies  exempt  from  operation  of  this  act,  955. 

Rates  of  assessments  to  be  based  on  P'raternal  Congress  mortality  table,  955. 

Provisions  from  the  general  laws  of  Vermont  applicable  to  fraternal   societies, 
056-957. 

In  actions  on  contracts  of  insurance,  general  counts  in  assumpsit  are  sufficient 
declaration.  950. 

Other  provisions  in  suits  on  contracts  of  insurance.  950. 
-VESTED  INTEREST: 

Member  has  no,  to  name  certain  beneficiaries  (Cal.).  34. 

Beneficiary  has  no  (Cal),  45. 


1140  FRATERNAL    SOCIETY    LAW 

VESTED  INTEREST— Continued: 

Wlien   beneficiary  Jias    (Colo.),  59. 

In  benefioiaiy ;  member's  liglit  to  cliange  (Colo.),  59. 

Benelioiaiy  has  no   (Colo),  55. 

When  beneficiary  has  (Colo.),  50. 

Beneficiary  has  no   (Colo.),  57. 

Beneficiary  has  no  (Conn.),  71-72. 

Beneficiary  has  no,  in  certificate  (111.).  I85-I8G. 

Beneficiary   has   no    (111.),   196. 

Beneficiary  has   no.  during  menil)pr"s   lite    (HI.).   102. 

Amendment  of  fundamental   laws   atlecting   (Iowa),  280-281. 

Beneficiary  has  no    (Iowa),  280:   2SS. 

Beneficiary  has  no  (Ind.),  232,  233,  23(1.  242. 

Beneficiary  has  no  (Mich.),  282. 

Beneficiary  has  no  (Minn.),'  527-528. 

Beneficiary  may  have  equitable  (Mo.),  500. 

Beneficiary  has  no   (Mo.),  578.  007. 

Benefieiary  has  no,  while  member  lives,    (ilo.),  000.  000. 

Beneficiary  has  no    (Neb.).  (i34.  04S. 

Of  members   (X.  H.),  075. 

In  beneficiary  recognized   (X.  Y.i.  715. 

In  certificate  may  be  assigned  (Ore.),  819. 

Beneficiary  has  no  (Pa.),  839. 

To  what  extent  beneficiary  has  (S.  D. ),  870. 

Beneficiary  has  no  (Tenn.),  903. 

Beneficiary  has  no  (Texas),  935. 

BencHciary  has  no  (Wash.).  002. 

See  Beneficiary. 
VIOLATION: 

By  society  of  its  own  rules  in  enacting  by-laws,  effect  of   (111.),  194. 

See  Members,  Societies,  Contracts  Forfeiture. 
VIOLATION  OF  LAW: 

Death  in   violation  of  criminal  law    (Arl<.)   21. 

Death  in.  what  is  not  (Ark.)  21. 

Death  in  violation  of  criminal  law    (Fla.).  102. 

Death  in  violation  of  criminal  law,  what  is  meant  by   (Ca.).  117. 

Death  while  committing  a  felony   (Ga.),  117. 

Violation  of  criminal  law  by  member  as  ground  for  forfeiture   (Ga.).  117-118. 

Death  in  violation  of  law  (ilo.),  509. 

Suicide  is  not  death  In  (Wis.).  1019. 
VIRGINIA: 

Statute  relating  to  fraternal  societies.  901-073. 

Definition  of  fraternal  beneficiary  association.  901. 

Power  to  increase  assessments,  001-002. 

May  make  constitution  and  by-laws  and  amend  same.  902. 

Age  limits  for  membership,  962. 

Must  make  provision  for  payment   of  death   benelits.  062. 

May  accumulate  and  nniinlain  a  rescivc  fund.  002. 


INDEX  1141 

VIRGINIA— Continued : 

I 

Bi'iielit  and  cxpciisi'  fiinils  to  he  dcrivcil  ficnii  as>c^-.iiicMl^,  'M'i2. 

Class  of  beneliciaiics,  !lG2-!Hi.'!. 

Clianjje  of  beiu'ticiaiy.  !)()3. 

Fraternal   societies   siiliject   to  supervision  ami  ilireetion  of  Biiieaii  of  Insur- 
ance, !)(i;i. 

But  not  subject   to  yencral  insurance  laws.  iM>:i. 

Existiii;^  societies  may  continue  business.  0(i;i. 

Admission  of  foieifi;n  societies;  provisions,  9U3-i)04. 

Annual  reports,  !)()4-n70. 

Examination  of  books  and  accounts;  certificate  of  examination.  !I70. 

Power  of  attorney;  service  of  process,  !)TI)!t71. 

License  to  do  business;  annual  fees,  071. 

Failure  to  nuiUe  report:   violation  of  law;   revocation  of  licen>e.  '.171-972. 

Doiny  business  without  license;   penalty,  !t7'i. 

Consolidation  of  societies;  transfer  of  niembersliip  aiul  assets,  072-973. 

Fraudulently  procuring  certificate;  penalty,  07.'i. 

Societies  not  subject  to  this  act,  073. 
VOID: 

Cleaning  of  "void"  and  "voidable"    (Ala. I.   11. 

After-enacted  laws   (tia.).  111. 

Validity  of  laws  does  not  depend  on  formality  ill  adoption   (111.).  103. 

See  After-enacted  Laws  and  Contract. 
VOLUNTARY   SOCIETY: 

I'owers  of   (Conn.).  72. 

Whomay  sue  in  behalf  of  (S.  C).  8tjO. 

Suit   against    (Ttah))    04S. 

See  Societies  and  Powers. 
WAIVER: 

(_)f  statute  of  limitations  void   (Ala.).  11-12. 

Of  proofs  of  loss  b.v  denial  of   liabilit.v   (Ark.),  20. 

Election  to  office  of  applicant  before  initiation   (.^rk.),  2(i-27. 

Defects  in  application  (Ark.),  27. 

Of  proofs  of  death  (Colo.),  58. 

Of  proofs  of  loss  (Fla.),  102. 

Of  written  contract   provisions  not  shown  by  custom   (Ga.).  108-100. 

Of  contract  jirovisious  not  allowed   (Hawaii).  120. 

Of  exem|)tion   of  ]irivilege  extendiu};'  to  couiiiiuuications  to  physicians   (Ida.), 
1.30  140. 

Of  provisions  of  constitution  same  as  by-laws   (lll.i.  171. 

Of  proofs  of  death  through  denial  of  liability   (111.),  181. 

Facts  in  case  (111.),  184. 

Of  laws  respecting  beneficiaries  (111.).  lOti. 

Of  contract  provisions    (111.),   103. 

Of  right  of  forfeiture  (111.).  182. 

By  knowledge  of  local  lodge   (111.).  18G. 

B.v  agents  of  precedent  conditions   (Iowa).  285. 

Of  proofs  of  loss  by  denial  of  liability   (lowaK  28(!. 


1142  FRATERNAL    SOCIETY    LAW 

WAIVER— Continued : 

Of  laws  of  society   (Iowa),  291. 

Of  proofs  of  loss   by  denial  of  lialiility    (Iowa).    293. 

Of  laws;  claimants  cannot  complain  of   (Iowa),  294. 

Depends  upon  efl'ect  on  opposite  party  (Iowa),  295. 

Of  laws  by  agents   (Iowa),  294. 

Of  laws  by  local  officers  allowed  (Iowa),  297. 

Of  proofs  of  death  b3'  denial  of  liabilitj'  (Iowa),  278. 

Of  forfeiture   (Ind.),  227. 

Of  proofs  of  loss  (Ind.),  227;  228. 

Of  forfeiture   by  agent    (Ind.),  242. 

And  estoppel  (Ind.),  240. 

By  agents  (Ind.),  239. 

Of  .right  to  forfeit   (Ind.),  233. 

By  members  of  incompentency  of  phj'sicians  as  witnesse;;  valid  (liul.l.  2.'il. 

Of  grounds  of  forfeiture  (Ind.),  242. 

Estoppel  for  acts  of  agent  (Ind.),  234. 

Ofter  of  compromise  admits  something  due  (Kas.),  322. 

Of  proofs  of  death  by  refusing  blanks   (Kas.),  319. 

Of  laws  by  local  lodge  (Kas.),  328. 

Of  warranty   (La.),  365. 

Of  proofs  of  loss   by  denial  of  liability  (La.),  301. 

Local  officers  cannot  waive  laws  (Mass.),  445. 

Of  forfeiture  (Me.),  390-391. 

Of  time  limit  for  bringing  suit  (Md.),  409. 

Of  proofs  of  death  l>y  denial  of  liability   (JId.).  410. 

Of  forfeiture  (Md.),  412. 

Ignorance  no  excuse  (ild.),  407. 

Of  forfeiture  by  negotiations  (Jlinn.),  522. 

Of  exemptions  in  favor  of  testimony  of  physicians   lilinn.).  518. 

Of  Laws  (Minn.),  533. 

Custom  does  not  always  \vai\e  laws  (Minn.).  530. 

Laws  not  v\aived  by  custom   (ilinn.)   52G. 

By  subordinate  lodge  (Minn.),  52G. 

Of  other  defenses  by  asserting  one  (Midi.).  481. 

Of  wari'anty  by  knowledge  of  agent  (Mich.),  470. 

Of  forfeitures  (Mich.),  492. 

Of  laws  by  local  lodge  (Midi.),  492. 

Of  initiation  (Mich.),  487. 

Of  proofs  of  loss  by  denial  of  liabilit}'  (Mich.),  487. 

Of  laws  respecting  changing  beneficiary   (Mich.),  4SG. 

Of  limitations  by  n(>gotiating  for  settlement  (ilich.l,  47(). 

Of  payments  (Mich.),  481. 

Of  defenses  by  furnishing  blanks  for  proofs  of  death   (Mo.).  599. 

Of  health  certificate  CMo.K  598. 

Of  laws  by  agents  not  favored  (Mo.),  507. 

Of  laws  by  custom  (Mo.),  595. 

Of  requirement  for  prom]it  ]iaynu'nt    (^[n.),  594. 


INDEX  1143 

WAIVER— Continued: 

or    laws    In-    local    ollieoi-    (.Mo,),    .■)!ll. 

Of  i)roofs  of  death  by  denial  of  lial)ility   (Mo,).  583, 

Of  rules  as  to  suspoiisioii    (Mo,).  (iOit, 

Of  rules  respecting-  elianj;in<;  iKMieficiaries   (.\1(].).  (Ids. 

Of  proofs  of  death  by  denial  of  liability   (.Mo,),  (iOO. 

Of  priA'ilege  of  exemption  in  favor  of  physiciau.s  (.Mo.(.  .")84. 

Definition  of  (Miss.),  554. 

Of  laws  respecting  change  of  beneliciaries   (Mont.),  (ilO. 

Of  proofs  of  death  by  denial  of  contract  (N.  C),  753. 

Not  to  result  from  occasional  favors   (N.  C),  754. 

Of  exemption  excluding  testimony  of  physicians   (X.  C, ),  74il, 

Of  proofs  of  death  by  denial  of  liability  (N,  C).  747. 

By  local  officials   (Neb.),  654. 

Of  laws  not  favored   (Neb.),  053. 

(Jf  laws  by  agents  (Neb.),  647. 

By  agents  unauthorized  (Neb.).  646. 

Of  forfeiture  (Neb.),  034.  638.  643,  (i45. 

Not  to  be  presumed  (Neb.).  630. 

Of  forfeiture  by  receipt  of  payments   (Neb,).  (i37. 

Of  laws  by  local  ofBcials  (Neb.),  636, 

Of  requirements  for  reinstatement   (Neb.),  635. 

Of  laws  by  agents  not  allowed   (X.  J.),  OtKi. 

Time   limit  to  sue   waived   by   repudiation    (X.  J.),  6!)3. 

Of  breaches  in  warrant,v    (X.  J.),  690. 

And  estoppel,  definition   of    (N,   Y.),  730. 

Exempting  privile_i;i's   in   favcn-  nf  physicians,  void    (N.   Y.),  721. 

Of  ultra   vires   act   in    naming   beneficiary    (X.   Y.).   720. 

Of  laws  restricting  class  of  beneficiaries   (N.  Y.).  720, 

True  rule  as  to   (K.  1.),  S5S. 

And  estoppel  in  agency  cases    (R,  1,).  ,850. 

When   facts  are  for  Jury    (S.   C),  863. 

Proofs  of  loss  by  denial   of  liability   (S.  C),  860. 

Doctrine  of.  applicable  to  societies    (S.  C),  860. 

Denial  of   liability   not  waived  by   offer  of  compromise    (S.  C),  85!). 

Of  assessments,  when   ((Tenn.),  Oil. 

Of  forfeiture  b.y  custom   in  dealings    (Tenn.),  000. 

Of  provisions  i-especting  beneficiaries   fTeiuLL   010, 

Of  laws  by  course  of  dealings   (Tenn,),  Oil, 

Of  forfeiture  by  course  of  dealing  (Tenn.),  905. 

Of   laws   respecting   changing   beneficiaries    (Texas),    046. 

Of  initiation  (Texas),  028. 

Of   warranties  in"  applications    (Texas).  028. 

Of  laws  by  local  lodge   (Texas),  923. 

Of  laws  b.v  local  oflRcials  not  allowed   (Utah).  040. 

Of  right  to   forfeiture    (Va.),   969. 

Of   laws    not  allowed   by   custom   of   agents    (Ya,).   074. 

Of  ground  for  forfeitme   CS't.).  958. 


1144  FRATERNAL    SOCIETY    LAW 

WAIVER— Continued: 

Provisions  against,   Ijv   agents    (W'asli.),   !l!)7. 

By  course  of  dealing  and  custom   (Wasli.),  1)98. 

Of  rules   respecting   changing   beneficiaries    (\^■asll.),   992. 

Provision  against,  not  valid  when  not  called  to  applicant's  attention  (\Yash.), 
991. 

Of  proofs  of  l(i>s  l>y  denying  liability   (W.  \'a.l.  1002. 

E.\tent  of  power  of  agent   (W.  V'a.),  1001. 

Of  forfeiture  by  receipt  of  overdue  assessments   (Wis.).  1021. 

Of  proofs  of  death  by  denial  of  liability  (Wis.).  1022. 

Through  agents  not  favored  (Wis.),  1019. 

Of  prompt  payment  of  assessments    (Wis.).   1017. 

See  Agency,  Contract,  Proofs  of  Death. 
WARRANTIES: 

Breach   of    (Ark.),  21. 

When   material    (Ark.).   27. 

Doubtful  language  (Cal.).  32-33. 

Representations   (Colo.),  01. 

Forfeiture   under   promissory    ((ia,).    114. 

False  statements  in  application   known  to  local   lodge,  efi'ect  of    (111.).  180. 

False  answers  in  application    (Iowa),  284,  285. 

Answers  in  application  to  be  construed  liberally  in  favor  of  ajiplicant   (Iowa), 
287-288. 

Statements  of  applicant  pre\  ious  to  making  ap[>lication   (Inwa).  290. 

As  to  age  (Iowa),  296. 

Separate,  separate  breaches  of   (Iowa).  270. 

As  to  age  of  applicant   (Ind.).  2.oO. 

Error  in  age;   voidable  contracts   (Ind.).  2.'jO, 

Promissory,  respecting   habits    (Ind.).   243. 

Promissory,   and    breach    of    (Ind.),    237. 

As  to  good  health   (Ind.).  231. 

Immaterial   answers   made   material   by    iKas.i.   32."). 

Misstatement  of  applicant's  habits  (Ky.).  331. 

Untrue  answers  avoid  contract   (La.).  367-308. 

Versus    representations    (La.),    367. 

Materiality  of  statements    (La.).  36.). 

Waiver  of;  estoppel  (La.),  305. 

Of  untrue  answers  in  application    (La.).  302. 

JIateriality  of  matter  conceded  from   s])ecial    im|iiiry    (La.).  302. 

False   statements  as   to   age    (Me.).   389-390. 

Materiality   of   statements    (Me.).   387. 

Misi-epresentation  in  application  (Jld.l.  41."i-410. 

Misrepresentation  avoids  contract   (Md.).  40S. 

As  to  statement  of  age   (Md.).  408. 

Agent's   knowledge   not    imputed    (Mitui.i.   524. 

False  answers  defeat  contract   (Minn.).  .523.. 

When   payments   made   are   forfeited    (Minn. I.   521. 

Void  contract  ab  initio  (Minn.).  521. 


INDEX  1145 

WARRANTIES— Continued: 

As  t(i  iiffi!   (Minn.).  :>>]. 

Constniction   of    (Minn.).  .V21I. 

In    applicatiiin    (Minn.).   .Vill. 

As  to  age    (Minn.),  .5;j;i. 

And   misrepresentation    (Mass.),    4-14. 

Breach   of    (Mich.),   470-474. 

Not  waived  by  knowledge  of  agenls   iMi<'li.).  470. 

Breach  of   (Midi.).  470. 

Misrepresentation  as   to   family    history   j,Mo.i.  .">;)!). 

Truth  of  statcinents  in  api>lication  condition  inccedent   (Mo.).  584. 

Will  not  be  created  or  extended  l)y  constr\ution  or  implication    (Nev.),  658. 

Materiality  may  be  fixed  by   contract   (Nev. i,  (>.")8. 

Immaterial   questions  and   answers    (Neb.).  (144. 

Misrepresentation:   good  faith  of   mcml)cr    (Neb.).  ti4:i. 

Materiality   determined  by  c(nitrai(    (N'cb. ).  (i.W. 

Breach  in  part;  waiver   (X.  .1).  (>!io. 

And   re])rcspntations,  rules   witli   respect   to    (\.   •!.).  (ISS. 

Immateriality    of   representations    (Okla.).   H12. 

Of   literal    truth  of   a|)plication   reasonalilc    (Okla.).  sll. 

Breach  of;   evidence  under    (I'a.),  847. 

Knowledge  of  agent   as   to  false  statemcnls  under,  not  admissiljle   (Pa.),  845. 

What   is    material    to   risk    (I'a.).   845. 

As   to  age   nutst   be   literally   ke])t    (I'a.).  S4.'i. 

As  to  age:   evidence  for  jury   (Pa.),  843. 

As  to  age:   evidence  under   (Pa.),  844. 

Duty  of  court  to  instruct  in  case  of  breach   of    (Pa.).  838. 

Breach   of,  avoids   contract    (Pa.).  83(i. 

Breach   of;    verdict   for   society    (Pa.).   830. 

Evidence    under    (Pa.),    835. 

When  error   to   submit  question  of   materiality  to   jury    (Pa.).  834. 

In  case  of  breach,  directed  verdict  proper   (Pa.),  834. 

Parol   statements   not   allowed   to    \ary    (Pa.),   8.35. 

Falsity  of  answers  and  not  fraud   the  test   (P.   T.).  852. 

Limitations    respecting    (S.    C),   802. 

As   to    age   stated    in    application,   ]iart    of   contract    (Tenn.),   906. 

As  to   age   waived    Creun.).   000. 

Under  reinstatement  a))plicatiou    (Tenn.).  007. 

Rule    respecting    (Tenn.),    006. 

Good  faith  of  declarations   (Tenn.),  002. 

Of  answers  liberally  construed    (Texas),  037. 

Immaterial   answers  no  defense  under    (Texas),  936. 

Must   be   literally    kept    (Texas),   933. 

Misstatement   in  apjdication    (Texas),  933. 

As  to  statement   respecting   habits    (Texas),   930. 

Waiver  of    (Texas),  928. 

Definition  of   (Texas),  924. 

Oral  statements  do  not  change  written    (Texas),  924. 


1146  FRATERNAL    SOCIETY    LAW 

WARRANTIES— Continued: 

False   statements    (Va.).   !t7S. 

False  answers  under  (Va.).  !)7j. 

Strictly  upheld   (Va.),  975. 

Literal  truth  of  answers  requiied  under   (Va.),  975,  974. 

Belief  in   truth  of  answers  immaterial   (Vt.),  959. 

Breach  of  wairanty,  meaning  of  term    (Vt.),  957. 

What  evidence  competent  under   (Wash.),  996. 

Must  be  strongly  enforced   (Wis.),  1029. 

Effect  of  incontestable  clause   (AVis.),  1019. 

See  Materiality  and  Representations. 
WASHINGTON: 

Statute  relating  to  fraternal  societies,  980-991. 

Deflnition  of  fraternal  beneficiary  association,  980. 

Must  make  provision  for  payment  of  death  benefits,  980.. 

Benefit  and  expense  funds  to  be  derived  from  assessments,  980. 

Class  of  beneficiaries,  980. 

Fraternal  societies   exempt  from  insurance  "laws,   980-981. 

^lay   create  and  maintain   a  reserve  fund,  981. 

Existing  societies  may  continue  doing  business.  981. 

Admission  of  foreign  societies;  provisions,  981-082. 

Power  of  attorney;   service  of  process,  981,  98-1-985. 

Must  be  authorized  to  do  business  in  State  where  incorporated,  981. 

Examination   of   societies'    affairs,   981-982. 

Annual  filing  of  certificate  of  authority,  982. 

Annual    report,   982-984. 

Additional  inquiries,  984. 

Permit  to  do  business.  985. 

Incorporation  of  beneficiary  associations.  985-986. 

Employment  of  paid  agents,  980. 

Beneficiary  cannot  pay  member's  assessments.   980. 

Funds  not  liable  to  attachment,  986. 

Rates  of  assessments  to  be  governed  by  Fraternal  f'nngross  mortality  table, 
986-987. 

Fraternal   Congress   :Mortality   Table,   987-980. 

Meetings  of  legislative  or  governing  body.  989. 

False    or    fraudulent    statements    to    obtain    insurance;    penalties,    989-990. 

Neglect   to   report;    violation   of   laws;    revocation   of   license;    reinstatement, 
990. 

Doing  business   without  license;    penalty,  990-991. 

Societies    exempt    from    the   provisions   of   this    Act,.  991. 
WEST  VIRGINIA: 

Has    no   fraternal   insurance   code.    1000. 
WIDOW: 

Eight  of,  against  executor  (Mass.),  449. 

De  facto  as  beneficiary   (Jlich.).  484. 

Of  coerced  marriage   (Miss.).  .551. 

Is  heir   (.Mo.).  604. 

See  Beneficiaries  ami  Wife, 


INDEX  1147 

WIFE: 

Wife's  dower,  wliat  is   (Ark.),  23-24. 

Divorce,  u/l'ect  of,  when  iiaiiied  as  beiieliciary    (Cal.),  41. 

Divorce  of,  after  being  named  as  beneficiary  (Colo.),  00-01. 

Divorce  of,  after  being  named  as  beneficiary   (Iowa),  283. 

Divorced,   competent   as   beneficiary    (Iowa),   297. 

Common  law,  rights  of,  as  beneficiary    (Mo.),  005. 

liigbt  of  divorced,  as  beneficiary    (Pa.),  839. 

Urotlier  as   trustee  for   (Pa.),  840. 

Kiylits  of,  as  beneficiary   (S.  C),  804. 

And  lieirs   as   beiu-liciaries    (S.   C),  803. 

See  Widow  and  Beneficiaries. 
WILL: 

Beneficiaries   cannot   be   changed   by    (Cal.),  40. 

Naming  of  beneficiary   by    (111.),   197. 

Naming  beneficiary   (Miss.),  oul. 

Designation  of   beneficiary   by   (Pa.),  837. 
'     Beneficiary  not  to  be  named  by   (Tenii.),  904. 

Naming  beneficiaries   in   (Texas),  9.30. 

Of   member    does    not    emilrul    lieneficiaries    (A\'is.).    1027. 

See  Beneficiaries. 
WISCONSIN: 

Statute    rehitJMg    t(.    frateiiial   societies,   1003-1017. 

Organization    of    fraternal    societies;    conditions,    1003. 

Rates  of  assessments   shall  be  based  on  National   Fraternal  Congress  mor- 
tality table.   1003-10()t). 

Accident  associations  nmst  deposit  security  for  payment  of  claims,  1006-1007. 

Limit  of  size  of  certificate  one-tenth  of  assets,  1007-1008. 

Filing  papers  with  Commissioner  of  Insurance,   1008. 

Class    of    beneficiaries;   change    of   beneficiary,    1008-1009. 

Age   limits   for   members,   1009. 

Societies  shall   aecunuilate  and  maintain  a  reserve  fund.   1009. 

Provisions  as  to  reserve  fund,  1009. 

Admission   of   foreign   societies:    provisions,    1009-1011. 

Filing   application   for   admission.    1009-1010. 

Filing  copies   of   articles   of  inccn-poration,  constitution,  by-laws,  etc.,   1010. 

Must  be  authorized  to  transact  business  in  State  where  incorporated,  1010. 

Power  of  attorne.y;    service  of  process,   1010-1011. 

Retaliatory  clause,  as  between  States,   1011. 

Conflict  in  names;   misleading  literature,  1011. 

Annual   report,   1011-1013. 

Inspection  of  books;    violation  of  law;   revocation  of  license.   1013-1014. 

Exannnation  of  societies,  1014. 

Meaning  of  the  words  "assessment"  and  "organization,"   1014. 

License    fee,    1014-1015. 

Investment   of   funds:    deposit   of   securities,    1015. 

Reorganization   of   societies;    provisions,   1015-1016. 

Definition   of  terms.  1010-1017. 


1148  FRATERNAL    SOCIETY    LAW 

WITNESS: 

Wlu'ii  member  not  coniiietent   as   (HI.),  1(S3. 
See  Evidence. 
WYOMING: 

Statute    relating    to    fiateriial    societies,    1U30-1037. 

Uctinition  of  fraternal   benetieiary    associations,   1030. 

ilust  make  provision  for  payment  of  death  benefits,  1030. 

Benefit  and  expense  funds  to  be  ilerived  from   assessments,   1030. 

Class  of  beneficiaries,  1030. 

Fraternal  societies  exempt  from   insurance  laws,  10.!0-1031. 

Existing   societies   may   continue   doing   business,    1031. 

Admission  of  foreign  societies;   provisions,  1031-1032. 

Must   be  authorized  to  do  business   in  State   where  incorporated,   1031. 

Examination    of    societies'   afl'airs,    1031-1032. 

Annual    report,    1032-1033. 

Additional  inquiries,  1033. 

Power  of   attorney;    service    nt   process.    !()33-1034. 

Permit  to  do  business;   fees,   10:34- 10:3.5. 

Benefit   fund  not    subject   to   attachment    for   debt,    1035. 

Meetings  of  legislative  or  governing  body,  1035. 

False   or   fraudulent    statements    to    obtain    insurance,   etc.:    penalties,    1035- 

1030. 
Failure   to  make  report;    penalty,   1030. 

Maladministration:    violation   of   law;    iniunction:    reinstatciiienl.   1030. 
Doing   business   without   autliority;    penalties,    1030-1037. 
Societies  not  aiTected  bv  this  Act.  1037. 


CARDS    OF   LAWYERf^  114y 

Cards  of  Lawyers  Giving  Special  Attention   to 
the  Practice  of  Fraternal  Society  Law. 

y 

Arkansas. 

Bradshaw,  Rhoton  &  Helm, 

(Dc  E.  Bradshaw,  Lewis  Rhoton  and  T.  E.  Helm.) 
Kahn  Building,  -  -  Little  Rock,  Arkansas. 

General   Practice 

in  all  the  Courts  and  Counties  of  the  State,  and  representing  Sovereign  Camp  Woodmen  of  the  World, 

Knights  of  Pythias,  and  the  Missouri  State  Life,  Volunteer  State  Life,  Dcs  Moines  Life, 

Fidelity  &  Casualty  and  the  Aetna  Indemnity  Companies. 

Arkansas. 

U.  L.  Meade, 

{of  Meade  &  Davis,) 

Russellville,      -     -     -     Arkansas. 

General  Practice  and   Representing  Supreme  Lodge 
Knights  of  Pythias,  Insurance  Dept. 

California. 

Henry  C.  Schaertzer, 

Attorney  and  Counsellor-at-Law, 

HUMBOLDT  BANK.   BLDG.,      -     SAN   FRANCISCO,  CAL. 

Has  had  over  twelve  years  experience  in  Fraternal  Insurance  Law  and  Litigation  and  refer  to 

Hon.  Carlos  S.  Hardy,  General  Counsel,  Supreme  Lodge  Knights  of  Pythias, 

Chicago,  Illinois. 

Colorado. 

Allen  &  Webster, 

301-304   Cooper  Building,   Denver,  Colorado. 

Practice  in  all  Courts. 

General  Counsel  for  Supreme  Lodge,  Fraternal  LInion  of  America. 


11^0  CARDS    OF   LAWYERS 

Connecticut. 

JOHN  W.   ALLING,  SAMUEL  C.   MOREHOUSE. 

JAMES  H.  WEBB.  ARNON   A.  ALLING. 

Ailing,  Webb  &  Morehouse, 

Attorneys  and  Counselors-at-Law. 

Experienced  in  Fraternal  Society  and  Life  Insurance  Litigation, 

First  Nat.  Bank  Bldg.,  Cor.  Church  and  Crown  Sts., 

NEW   HAVEN. 


Georgia. 


Jacob  Gazan, 

Attorney-at-Law, 
Provident  Building,      -     Savannah,  Ga. 


General  Civil  Practice  in  State  and  United  States  Courts.  Special  and  Personal  Attention  given  to 
Commercial,  Corporation,  Probate  and  Insurance  Practice.  Attorney  for  Supreme  Lodge 
Knights  of  Pythias,  Insurance  Branch;  National  Association  of  Credit  Men,  Savannah  Branch; 
Retail  Merchants'  Association  of  Savannah,  etc. 

Reference:     The  National  Bank  of  Savannah. 

Illinois. 


William    B.  Risse, 

Court  of  Honor  Bldg. ,  Springfield,  111.,  and 
429  Main  St.,  Carthage,  111. 

General  Practice, 

Insurance  Law  and  Municipal  Bonds.      General  Attorney  Court  of  Honor. 

Illinois. 


Dwyer  &   Dwyer, 

Commercial  Bank  Building,  -  Danville,  Illinois. 

General   Counsel;      Corn   Belt  Life   Insurance  Company,    Illinois    Woodmen   Accident    Association,- 

Commercial  Trust  and  Savings  Bank,  American  Bank  and  Trust  Co.     Local  Counsel: 

Modern  Woodmen  of  America,  Court  of  Honor,  Peoria  Life  Association. 


CARDS    OF   LAWYEIiS  1151 

Illinois. 

Carlos   S.  Hardy, 

Attorney  and  Counsellor, 
Manhattan  Bldg.,  .  .  -  Chicago,  111. 

General  Counsel,  Supreme  Lodge    Knights  of  Pythias,  Insurance  Department. 


Iowa. 


Nelson,  Duffy  &   Denison, 

Lawyers. 

p.  J.    Nelson,    County     Attorney;    Thomas   H.    Duft'y,    National    Lecturer    Moilcrn    Woodmen  of 

America  and  John  D.  Denison,  Jr.,  Director   Brotherhood  of  American  Yoeomen 

and  Member  Beneficiary  Committee  Royal  Neighbors  of  America. 

Security  Building,  .  -  .  .  Dubuque,  Iowa. 


Indiana. 


Charles   L.  Wedding, 

Attorney  and  Counsellor, 

Representing  Court  of  Honor  and  the  Supreme  Lodge  Knights  of  Pythias,  Ins.,  Dcpt., 

Suite  29  Arcade,    314  Main  St.,     -     Evansville,  Ind. 


Indiana. 

C.  S.  and  G.  L.  Denny, 

Lawyers, 
Indiana  Pythian  Bldg. ,         -         -        Indianapolis,  Ind. 

Represent  The  Supreme  Lodge  Knights  of  Pythias,  Ins.  Dept.;  Court  of  Honor;   Modern  Woodmen 
of  America  and  other  Insurance  Societies. 


1152  CARDS    OF   LAWYERS 

Kansai. 

George  A.  Huron, 

Suite  6,  Office  Block,  Topeka,  Kansas. 

Practice  in  State  and  Federal  Courts. 

General  Attorney  Knights  and  Ladies  of  Security.      Twenty-five  years' 
Experience  in  Fraternal  Beneficiary  Society  Law. 

Kentucky. 

ASHER  G.  CARUTH.  .1.  M.  CH  ATTERSON.  SAMUEL  5.  BLITZ. 

Caruth,  Chatterson  &  Blitz, 

Attorneys-a't-Law, 

Louisville,     -     -     Kentucky. 

Counsel  for  several  Fraternal  Benefit  Societies. 

Kentucky. 

L.  J.  Crawford, 

Attorney-at-Law, 

Newport,        -  -        Kentucky. 

Was  Counsel  in  Union  Central  Life  Insurance  Co.  vs.  Spinks,  26  Kentucky  Law  Rep.    1205  and 

U.  S.  Life  Insurance  Co.  vs.  Spinks,  29  Kentucky  Law  Rep.  960  and  31 

Kentucky  Law  Rep.  185  and  many  other  important  Cases. 

Kentucky. 

Bagby  and  Martin, 

Attorney  s-at- Law, 

Paducah,  Kentucky. 

Practice  in  State  and  U.  S.  Courts  and  represent  the  Supreme 
Lodge  Knights  of  Pythias,  Insurance  Dept. 


Massachusetts. 


Joseph   C.   Pelletier, 

Attorney  and  Counsellor, 

18  Tremont  St.,  Boston,  Mass. 

National  Advocate  for  Knights  of  Columbus. 


Massachusetts. 


CAHDti    OF    LAWYKRS 


Charles  L.  Young, 

Attorney-at-Law, 

Notary  Public, 

597  Main  St.,   Springfield,  Mass. 


1153 


Michigan. 


Hal  H.  Smith, 

Lawyer. 

Attorney  Michigan  Manufacturers'  Association,  Court  of  Honor,  etc., 
Penobscot  Bldg.,  -  Detroit,  Mich. 

Minnesota. 

C.  L.  Hilton, 

Attorney  and  Counsellor, 

First  National  Bank  Building,   Fergus  Falls,  Minn. 
Refer  to  Modern  Woodmen  of  America  and  Supreme  Lodge  Knights  of  Pythias,  Ins.  Dept. 


Minnesota. 


Charles  G.  Laybourn, 

Lawyer, 

New  York  Life  Bldg.,  Minneapolis,  Minn. 
Refer  to  Court  of  Honor. 


Mississippi. 


McWillie  &  Thompson, 

Attorneys  and  Counsellors. 


Represent  the  Supreme  Lodge 
Knights  of  Pythias,   Insurance  Dept. 


Mc  Willie  and  Thompson  Bldg., 
JACKSON,    MISS. 


1154  CARDS    OF   LAWYERS 

Mississippi. 

Smith,  Hirsh  ^  Landau, 

VICKSBURG,   MISS. 

General  Practice  and  Attorneys  for  tht  Yazoo  &:   Mississippi  Valley  Railroad  Company,  the  Alabama 

&c  Vicksburg  Railway  Company,   the  Vicksburg,    Shreveport  &   Pacific  Railway  Company, 

Refuge  Cotton  Oil  Company  and  the  Mississippi   Cotton  Oil  Company,  and 

Delta  Trust  t^  Banking  Company. 

Refer  also  to  Carlos  S.  Hardy,  General  Counsel,  the  Supreme  Lodge  Knights  of  Pythias,  Chicago,  111, 

Missouri. 


R.  p.  Williams, 

R.  P.  and 

C.  B.  Williams, 

Attorneys-at-Law, 

Third  National  Bank  Eldg.,      -     St.  Louis,  Mo. 

Missouri  Attorneys  for  the  Supreme  Lodge  Knights  of  Pythias,  Royal  League, 
Supreme  Tent  Knights  ot  the  Maccabees,  etc. 


Nebrasi<a. 


Arthur  H.  Burnett, 

Attorney  ;ind  Counsellor, 

Woodmen  of  the  World  Bldg.,     -     OMAHA,    NEB. 
General  .Attorney  Sovereign  Camp,  Woodmen  of  the  World. 


New  York. 

Duckwitz,  Thayer  &  Tuttle, 

Attorneys  and  Counsellors, 

D.  S..  Morgan  Bldg.,  Butlalo,  N.  Y. 
General  Practitioners,  making  a  specialty  of  Fraternal  and  Insurance  Law. 


CARDH    OF    LAWYERS  ]155 

New  York. 

James  C.  De  La  Mare, 

I)E    I.A    MARK     &      MORRISON, 

Attorneys  and  Counsellors, 


Many  years  experience  in  handling  Fraternal  Society  Matters.  299   Broadway, 

Refer  to  Supreme  Lodge  Knights  of  Pythias,  Ins.  Dept,  NEW   YORK,    N.  Y. 


New  York. 

WILLIAM   I)cM.   HOOPER,  Frcsiikiil.  BAYARD   P.   HOLMES,  Vice  Prcsidcnl. 

The    Hooper-Holmes, 
Information  Bureau,  Inc., 

87  Nassau  St.,  NEW  YORK  CITY. 

INSPECTION  Inspections  through  local  correspondents  at  all  points  in  the  United 
DEPARTMtNT  States  and  Canada.  Special  attention  devoted  to  the  investigation 
and  adjustment  of  doubtful  claims. 

Exceprional  facilities  are  oftered  for  service  of  this  character,  the  tiles  of  the  Casualty  Department 
alone  containing  OVER  ONE  MILLION  RECORDS  of  sickness  and  accident  claims,  rejections, 
cancellations,  etc.,  which  are  examined  for  information  in  all  cases  placed  with  the  Inspection  Depart- 
ment.     Conclusive  evidence  of  breaches  of  warranties  in  the  application  Is  thus  frequently  secured. 

Confidential  reports  also  furnished,  at  nominal  cost,  on  prospective  members,  deputies  and  ex- 
aminers. 

Requisition  blanks  and  sample  forms  furnished  on  request.      Correspondence  Invited. 


North  Carolina. 

Rob't    C.  Strudwick, 

Attorney  and  Counsellor-at-Law, 

Represent  the  Supreme  Lodge  Knights  of  Pythias,  Ins.  Dept.  GREENSBORO,    N.  C. 

North  Dakota. 

Geo.  A.  Bangs, 

Attorney  and   Counsellor, 
Notary  in  office.  Grand  Forks,  North  Dakota. 


1156  CARDS   OF   LAWYERS 

Ohio. 

Grant,  Sieber  &  Mather, 

Attorneys  and  Counsellors, 

Dobson  Bldg.,    Akron,  Ohio. 

Fifteen  years'  experience  in  defense  of  Fraternal  Societies.      Mr.    Sieber 
was  formerly  General  Counsel  for  the  Pathfinder. 


Ohio. 


Howard    Douglass, 

Lawyer, 

Dickson  Bldg.,  159  and  141  E.  4th  St.,  Cincinnati,  Ohio. 
Many  years'  e.xperience  in  handling  Fraternal  Society  Matters. 


Ohio. 


Ewing,  Nieding  &  Kramer, 

Attorneys  and  Counsellors, 

American  Trust  Bldg.,       :-:       Cleveland,  Ohio. 

Refer  to  Hon.  Olin  Bryan,  General  Attorney  for  the  Heptasophs,  and  to 

Carlos  S.   Hardy,  General  Counsel   for  Supreme   Lodge   Knights  of 

Pythias,  for  whom  important  matters  have  been  handled. 


Oklahoma. 


F.  C.  Hunt, 

Attorney  and  Counsellor, 

Billingsloy  Bldg  ,  Guthrie,  Oklahoma. 

General  Practice^ Fraternal  Society  Practice  a  Specialty. 
Refer  to  Court  of*  Honor. 


Tennessee. 

W.    H.    Diet/,, 

Attorney  and  Counsellor, 

Kingston,  Tenn. 

Experienced  in  Fraternal  Society  Mattery.      Attention  in  any  part  of  State  to  business  submitted. 


CARDH    OF    f.AWYERf^  ll;j7 

Tennessee. 


Thomas   &  Thomas, 

Attorneys, 

Rooms  604,  605,  606  and  607  Tcniple  Court,     -     Chattanooga,  Tennessee. 

General   Practice. 

Practitioners  in  Supreme  Court  of  the  United  States,  Supreme  Court  of  Tennessee,  and   Federal  and 
State  Courts  in  Tennessee. 

General  Counsel  for  United  States  Fire  Insurance  Co.,  Chattanooga,  Tenn. 
Consignees  Favorite  Box  Co.,  **  '* 

Fritts  &  Wiehl  Co.,  "  " 

Granger  Medicine  Co.,  *'  ** 

Resident  Attorneys  for   Chattanooga   Company,    Limited^   Metropolitan    Life    Insurance    Company; 
Supreme  Lodge  Knights  of  Pythias. 

Tennessee. 

R.  G.  BROWN.  H.  B.  ANDERSON. 

Brown  &  Anderson, 

Lawyers, 

Memphis  Trust  Building,     -     Memphis,  Tenn. 
Attorneys  for  Knights  of  Pythias.      Practice  in  all  the  Courts  of  West  Tennessee 
and  Eastern  Arkansas. 


Tennessee. 

F.    Zimmermann, 

Lawyer, 

Tennessee  Trust  Bldg.,    Memphis,  Tenn. 
General  Attorney  Supreme  Hive  Ladies  of  the  Maccabees  of  the  World. 


Texas. 


Kleberg  &  Neethe, 

Attorneys  and  Counsellors, 
Levy  Building,  -  -  -  Galveston,  Te.xas. 


llTiS  CAIfDS    OF    LAWYRRS 

Texas. 

Henry    P.   Brown, 

BROWN   &    I.OMAX, 

Attorneys  and  Counsellors, 

Cleburne,  Texas. 

Member  Board  of   Control,  Supreme   Lodge  Knights  of  Pythias,    Insurance  Dept. 

Experienced  in  Fraternal  Matters       Business  attended  to  in  any 

part  of  State. 


Texas. 

Onion  &  Henry, 

Attorney  s-at- Law, 

Kampmann  Building,  San  Antonio,  Texas. 

Several  years  experience  in  representing   Fraternal  Societies.      Represent:   Supreme  Lodge  Knights  of 
Pythias,  Insurance  Dept.j  Woodmen  of  the  World;  Woodmen  Circle,  etc. 


South  Carolina. 

J.  E.  Burke.  M.  Rutledge  Rivers.  H.  L.  Erckmann. 

Burke,  Rivers  &  Erckmann, 

Attorneys-at-Law, 

32  Broad  St.,  -  -  -  Charleston,  S.  C. 

Representing: 

Supreme  Lodge  Knights  of  Pythias,    Insurance    Department;     Sovereign  Camp,   Woodmen  of  the 
World  and  other  Fraternal  Organizations. 


CAJa),S    ()!'•    LAWVKHK  \\:,\) 


South  Dakota. 


U.  S.  G.  Cherry, 

Attorney   and   Counsellor, 

Sioux  Falls,  -  -  -  South  Dakota. 

Fraternal  matters  in  anv   part  of  State  will  receive  attention.      Resident   Attorney 
for  C.  B.  &  Q.  Ry.  Co.;  Member  Board  of  Control,  Supreme 
Lodge  Knights  of  Pythias,  etc. 


LAW   LIBRARY 

OF 
LOS  ANGELES  COUNTY 


I'JCSOyTHERN  RFGIONAL  llBI»Hy  r/.tji  i  f  r 


D    000  760  310    3 


